Founder of BitMEX: How to Realize Technology and Art in the Future
Article translation: Block unicorn
Article translation: Block unicorn
Original title "Rock, Paper, Scisors Says GO!"
(Any opinion expressed below is the author's personal opinion and should not be used as the basis for investment decision-making, nor should it be interpreted as a suggestion or opinion on engaging in investment transactions.)
Art is the expression of the rich energy of human civilization. From a net energy perspective, this is completely worthless. But when viewed as the purest expression of being human beyond our basic functions of burning calories, reproducing, and dying, it is invaluable. We "work" to enjoy leisure, which is a personal pursuit that often involves some art form. This includes music, film, painting, sculpture, sports and more. All of these activities are energy draining, but endless fun for participants and spectators.
The advent of superintelligent networked thinking machines will herald an era in which the vast majority of human labor is economically worthless. Freed from the physical confines of work, humanity will turn to their new digital world and the full expression of the creativity and dynamism of civilization. Metaverse is the future.
So, what is the concept of "art" in a purely digital structure? How can money, which is just an energy abstraction, be "wasted" in the pursuit of digital art? Like all other "traditional" art forms, are NFT-based art forms both worthless and priceless?
NFT-licensed art is completely worthless from an energy standpoint, but it will represent the ultimate way of flexing social status in a purely digital world. While it may seem silly to those who think that Art Basel and the Venice Biennale are the epitome of gatherings of like-minded cultural people, an infinitely reproducible JPEG traded on a blockchain is no better than a wave on a canvas. Lines are even more stupid.
NFT art is gradually being replaced by robots. With the improvement of technology, technology can completely replace the creation of human art. Our public account Block unicorn's recent article "Code in, Art Out" expounds how technology and art will be realized in the future and the current situation of technology and art. process.
you are worthless
Compared with self-learning intelligent machines, the vast majority of human labor is not worth the energy investment required to maintain it. No matter how "smart" or "creative" you think you are, machines will be better than you in the next few decades.
What to do now? Once we got tired of the COVID lockdowns, seniors played sports, hung out on the beach, went to brick-and-mortar nightclubs, etc. (I mean millennials and older.) Young people will play video games and create whole new worlds in various digital metaverses.
The COVID-19 shock has only accelerated these trends. A large portion of the world's people are now locked away in their quarters; the only way for them to interact is through internet-connected machines. Whether you like it or not, your online presence is only going to become more important. The Metaverse is a work in progress and you are participating in its creation.
The metaverse will be anything the human mind can imagine, unencumbered by the conventional laws of physics we take for granted in meatspace. Entire new economies and careers that we can't even imagine will emerge in these worlds. The hope is that these jobs will create the same sense of self-satisfaction as traditional jobs, making people feel good about their lives. The alternative is that billions of restless souls will lash out at perceived and actual inequalities, especially as capital is further concentrated in the hands of our technological overlords.
The most powerful man in the world — defined by the number of users he influences — is Mark Zuckerberg. He bets that the community that will actually support Facebook in the future is the Metaverse. AR and VR devices that allow humans to create communities in digital spaces are what Facebook believes the next iteration of digital communities represents.
China is building a mobile-first online society. All data and interactions are networked, monitored and regulated by the state. Chinese Lantern Festival is a complete social credit score covering your entire online and offline life. Considering R&D spending on artificial intelligence and 5G, Beijing sees the future as a digital-first connected population.
Regardless of your politics, Western and Eastern capitals believe in the Metaverse.
players united
According to Statista, 2.55 billion people played some kind of video game in 2020. On average, gamers spend 54 minutes per day or 6.33 hours per week on their games.
With 2.55 billion people, gamers are the largest affiliate group. They cut across traditional peoples and religions. An interesting data point - which I don't have - is whether gamers feel a stronger sense of belonging to the in-game community or their country of birth/religion. I'd wager that as gamers spend more time in their virtual worlds, the affinity for a nation-state or religion diminishes in favor of an in-game community.
Games are not just shooters. I think of it as essentially some social activity in a virtual world. This construct will morph into any activity in the virtual world. If we consider the amount of time humans spend now on Zoom and Microsoft Teams (which are just virtual workspaces), the time spent socializing/working is much higher.
People love these new worlds. Preferences for working from home (WFH) versus working in office buildings draw lines across generations and income levels. Boomer bosses want to see their younger, poorer chattels sitting in offices where they can be regulated. The workforce, if it could be done online, would rather sit in the athleisure area of their own comfort home and benefit from the extra leisure time that no longer requires a commute. As we socialize in an entirely virtual environment to form strong bonds, the notion of closing deals through face-to-face meetings will become obsolete.
how to twist
As a social being, many activities and purchases are made with the sole purpose of publicly demonstrating how much energy you can waste. Nightclub Economy is an excellent proposal for this concept. Individuals walk into a dark room, listen to loud music (art), dance (a waste of energy, similar to courtship), and pay exorbitant money to drink fluids. Everyone was dressed in very nice clothes that served no purpose other than to show the other club members present that they spent a lot of money to demonstrate their social status.
If you think nightclubs are too tacky, how about a global art fair? Rich and famous art lovers, creators and curators waste energy traveling to one place. They come together to "collect" useless paintings, sculptures and other installations. There is a definite social pecking order based on which galleries you represent and/or how much useless stuff you hoard. Food and drinks are provided to socialize with other like-minded enlightened art lovers, and when you're done, everyone packs up and wastes more energy heading home.
Socialization and communication are what make humans unique. This is how we build monuments to our gods and rulers. This is how we put a man on the moon. This is how we created the internet and integrated circuits. Bending is both a 100% waste of energy and necessary to create social bonds for the advancement of civilization.
As we imagine what the Metaverse would become, how would its inhabitants change their social status? Back in the game, the already thriving economy surrounding the skin your online avatar wears points to a digital future of worthless artistic digital objects representing vast amounts of value.
DMarket estimates the skin market to be around $40B.
Newzoo also has an insightful report on US gamers' attitudes towards skin trading.
Report Highlights
“Among skin-aware core US gamers, 81% want real-world money for their skins and are therefore interested in skin trading. Over two-thirds are unaware of any major skin trading platforms in the US (including Steam's Community Marketplace, DMarket, OpenSea, and Bitskins)."
"Crucially, 75% of players interested in skin trading said they would spend more on skins if they had monetary value outside of the game."
Demographically, young males are the most likely to be exposed to gaming cosmetics, but big spender whales are older.
Our online avatars need to be flexible. The value of digital items combined with our unique online identities will explode. Ask yourself, would a die-hard gamer pay $1,000 for a rare skin, or $1,000 for a Louis Vuitton bag (you might ask, "what LV bag is only $1,000")? Both projects serve the same purpose. They show how much you can afford to waste resources by being rich, they are also scarce.
Flex Good
The product you're showing should have some of the following characteristics:
1. A good thing must be intrinsically worthless, or if it serves a purpose like a piece of clothing, there are cheaper alternatives that serve the same function.
2. When in doubt, check to see if the item is mentioned in the lyrics by a pop star. If true, then it could be Flex Good and essentially broke.
3. Owning an item shall grant membership to the exclusive community.
4. Goods should be limited in quantity, in other words, scarce.
Have you ever wondered what it's like to wear sock sneakers? Well, Balenciaga will sell you a pair for close to $1,000.
This is Flex, okay? Let's go through the list.
Attribute 1:
You can pay less for a pair of sneakers that will protect your feet while performing the biomechanical activity humans call walking. Yep, a rapper named Cardi B had the following to say about the aforementioned sneakers:
"I love those Balenciagas, the ones that look like socks".
Attribute 2:
If you buy these shoes, you show that you are part of a small community that appreciates high fashion and can afford the Balenciaga brand.
Attribute 3:
These shoes are semi-scarce. Balenciaga makes enough pairs that anyone with $1,000 can buy a pair. However, they are scarce monetary-wise, as most people can't afford to waste $1,000 on sock sneakers.
Crypto Flexing - The Art of Supporting NFTs
NFTs, or non-fungible tokens, are currently just records of ownership. NFTs tell us which encrypted public key is the real owner of a particular piece of data. As far as the current market is concerned, the reference art itself is easy to reproduce, but the original ownership is cryptographically unique.
With today's NFT art mostly in the form of digital images and videos, naysayers are dumbfounded as to why anyone would pay money (energy) for data that can be copied for free. Enjoy connected art without buying anything. It can also be transferred for free. What these people don't understand, however, is that art itself is tangential to Flex. It's about owning a cryptographically unique certificate... NFT.
Physical artwork has value because the artwork itself cannot be in two places at the same time. There is only one Mona Lisa in the Louvre. A jpeg of pixelated rock can be everywhere at once. So why are the values of both greater than zero?
In the Metaverse, it's not enough to just "wear" or "display" your digital items. You also have to be able to demonstrate its scarcity. This can be done cryptographically by owning an NFT.
There are two aspects to your Encrypted Flex. First, you have a bad looking pair of virtual sneakers, a cute penguin, a pixelated face or a jpeg rock that you can display on various social platforms or as your avatar. See how many crypto people are showing their worth and membership in elite communities by linking their avatars to NFT images. Finally, and most importantly, after owning a +1,000 ETH worth of cypherpunks because it's your Twitter avatar, you can actually prove that you own it cryptographically on the Ethereum blockchain. Now everyone knows how much you paid for it - you don't have to yell, "Hey world, I'm fucking rich." We humans like to abstract the display of our wealth in commodities rather than show it directly Our bank balances or wealth held on-chain are too trendy.
Ether Rocks is an interesting NFT project for evaluation and checklists.
Attribute 1:
EtherRock is actually a collection of rock PNG images. I wouldn't say they spend too much in the way of human creativity. They are essentially worthless.
Attribute 2:
If you own EtherRock, you are part of an exclusive community of no more than 100 people. You can buy as many EtherRocks as you want, but there will only ever be 100 of them.
Attribute 3:
EtherRocks are very scarce as there are only 100 minted.
It's an interesting project because PNG files are so obviously worthless and so uncreative that many people question why anyone would waste a lot of Ether buying them. In fact, almost 2,000 ETH worth of rock was traded in August alone. But the more obviously less valuable and more expensive the NFT, the bigger the flex. As with all things, value may fluctuate. Imagine owning a rock that was once worth a lot of ETH and is now worth nothing. The value volatility also adds to the Flex, as it means the owner is very happy that their Rock is worth 0 in the next Ethereum block propagation.
Trading NFTs
Just like traditional art, a healthy ecosystem of speculators will and has been attracted to NFTs. In the art world, they call them dealers or collectors, but they are betting on which worthless things will be "valued" by humans in the future. Doing well and making a profit over time is very difficult. How do people choose which contemporary artists to support so their portfolios continue to appreciate over time?
transaction data
transaction data
I don't have a full picture of the daily volume of NFT art, but I'll use the CryptoPunks and OpenSea projects as useful illustrations.
The following data comes from Dune Analytics.
Clearly, 2021 is a breakout year for the program. I think punk represents the energy and activity that exists throughout the space. People are struggling to buy essentially worthless pixelated faces OpenSea is one of the most popular NFT marketplaces. It is basically an encrypted version of Christie's and Sotheby's.
The following data comes from Dune Analytics.
This market is exploding. Imagine if there was a transparent marketplace for all art in the meatspace. Volume will be huge. That's the opportunity NFTs are set up for right now. If you still think of them as piles of cow dung, that's okay because the most sought-after projects are attracting actual liquidity.
The art world employs thousands of people whose purpose is to verify and verify the provenance and authenticity of works for sale. Fakes abound in the art world, considering it's done by fallible and sometimes conflicted people. This is not possible with NFTs traded on public blockchains. When you buy something on OpenSea, you are 100% sure that you are buying anything that is a Number Every specific item.
Using the blockchain to verify Flex Goods is superior because it cannot be counterfeited. Imagine a project that creates a symbol, which means that if you show a digital project on your avatar, you actually own the original file. This would be similar to a "blue check" on Twitter.
One of my boys, who dumps EM FX and bonds for a big hedge fund by day and secretly wants to be a K-pop star/NBA athlete, has gone deep into NFTs. Amongst the staff, he was always wearing some funky, expensive clothes from a brand we'd never heard of. He commented in one of our chats on the topic of NFTs:
“It's like wearable art offline but online”
“you can accommodate more people”
Scalable bends are a technician's dream. The ability to appear rich and cool is not limited to physical proximity, but includes the entire addressable market for your avatar.
firing them is dangerous
Distortion is an integral part of the human experience. We do not question the value of physical human space items used to demonstrate social status. We understand and value fashion, painting, jewelry and more. We all wear at work that speaks to which professional community we belong to. What's an investment banker without a Hermès tie or red-soled shoes? Clothing is part of self-worth.
Just because robots have taken over our human jobs doesn't mean humans are no longer human in the metaverse. Social signals will take a new form, powered by blockchain-enabled NFT "valueless" objects. Those who recognize these parallels and create new markets for digital Flex Goods early on will reap astronomical rewards. Those who are unhappy with this new worthless social signal can continue to walk down the street, walk into a store, and buy a $500 white T-shirt from some well-marketed fashion house. Choose your Flex Good appropriately.
