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The content comes from the collation of the interview column of "Not Boring".

The conversation comes from hosts Packy McCormick and Alex Danco. Alex works at Shopify as a Systems & Crypto person.

I hope it can bring you new perspectives and inspirations.

Moderator: We both work for Canadians — you at Social Capital, I at Breather — and we both write the newsletter. We've gone in different directions since then - I'm doing a newsletter and a fund, and you've slowed down the newsletter and become a full-time Shopify operator.

I remember when you took the job, I was thinking, a) that's cool! b) What exactly will you be doing at Shopify? c) Where will Shopify go? For those of you who don't use Shopify, can you define what Shopify is today and what you think it will be in the next 10 years?

Alex ：Let me describe Shopify briefly: it empowers everyone to do commerce better, and specifically, we do it through software: we're building an e-commerce platform. Our job is to build this platform in a unique way so that for merchants -- and many others, such as app developers, resellers, and now buyers -- we deliver the best software on the Internet.

Moderator: Alex Danco, what do you do at Shopify? Except, of course, for Shopify wallet-aware.

Let's jump right into Web3. When you first tweeted "gm" a few months ago, I thought you were being sarcastic. Then you change your avatar. Now you are running a blockchain team - your title on LinkedIn is "Systems & Crypto person". Have you been into cryptocurrencies for a while? What is your interest in it?

Alex ：Ha, that's really funny because it didn't even occur to me that it might get anyone's attention. I've dabbled in cryptocurrencies for a while; I've been writing about it in my newsletter for a few years now.

As for, "What's my interest in it?" I don't know. Everything should be of interest. Here are some examples of my favorite things to think and write about, but I think the bottom line is that the crypto world is finding its purpose, which should be what you want to know. There are generally three places people can spend their time:

- people without purpose

- People with established goals

- Those who are discovering their purpose.

You tell me which sounds the funniest.

Moderator: I'm going to start using it instead of "We're too early!"

For many, "discovering its purpose" means finding "real use cases".

To that end, Shopify is one of the more interesting places in trade tech from a crypto world perspective - crypto and commerce go hand in hand and your CEO Tobi seems really interested in it, after all there are over 1 million businesses in Runs on Shopify. Given its size and scope, it feels like Shopify can borrow its legitimacy as a use case that if Shopify supports something, it's a real use case because Shopify supports it.

With power comes great responsibility. How did you start thinking about whether to get involved and what to do in the field?

Alex ：I joined Shopify two years ago and found an interesting phenomenon, namely

1) A lot of people who are very familiar with cryptocurrencies are scattered in the company, but they also

2) Without the driving force of "alignment", everyone does not know what else to do besides trading cryptocurrencies.

Shopify merchants have been able to accept crypto payments for several years now, thanks to payment gateways built by third-party app developers (whereas we just built the overall commerce platform!).

But when NFTs took off last year, we really ignited the search for an answer to this question: Is this part of the "best version of the Internet" our platform has to offer merchants? The answer is clearly yes, although it took us a minute to find out why.

Moderator: Indeed. In my opinion, the first crypto news released by the company was the Chicago Bulls NFT store. When I think about Shopify's role from there, I think your big forays in the space will be along these lines -- NFT mint, drop, sale. You help businesses sell stuff — both physical and digital — so that includes helping them sell high-margin NFTs as well. That's not the way you go. Why?

Alex ：Well, Paki, this is what I want to talk to you about money. Back to our topic, rather than directly giving you a simple answer ("Because we realize, more than anyone, that tokenized commerce will be a 100x bigger opportunity than existing business models, it's more important to us than any other Everything is more fun").

Moderator: There was a line in Jonathan Haidt's great article a few weeks ago that immediately made me think of cryptocurrencies: "History has a direction, and it's toward greater collaboration ’.” The crypto world is a bet on greater collaboration without paying for companies that think they orchestrate everything. What do you think?

Alex ： I especially like the "coordination" part of this answer; for the record, I think there is of course no one right answer to this - there are many different communities and schools of thought about what blockchain and cryptocurrencies are doing for us here. This is a good thing. But I'll tell you mine, which I think covers a lot of important things.

When we look at the changes "happening" in the crypto world, we focus on two things:

Wallets change the way people behave, and:

Over time, this behavior wins.

Moderator: I like this answer because it blends social and technology, and how computers and humans interact. "First we shape our interface, then our interface shapes us."

Alex ：I think it answers the question pretty well, don't you think? It offers something for everyone. Sound Money has something for people (our wallets and crypto key pairs change the way we save and spend, and in the long run this behavior will outperform old behavior), dapp builders have something (wallets change the way people create and consume software), the community has something (wallets change the way people collect and display their identities).

I love this starting point because it brings us together on things we have consensus on. Encryption is fundamentally a behavior as much as it is a property of a technology, if not more so.

There are many aspects to this behavior, but it starts with cryptography; it starts with our wallets, when we sign something. It starts at a certain moment, that magical moment when our wallet opens a door to a new world and steps into it.

We're working on some cool stuff in that world. We call it Tokenized business.

Tokenized commerce starts with an observation: there is a new type of Internet user in the world, called people with wallets.

Moderator: I like this frame: people with wallets. Descriptions of what encryption lets people do are common, but I haven't seen any that describe what encryption lets people be.

Alex ：That's it. Forget about what you can do for a moment, let's talk about who you can be.

I'll tell you the answer: you'll be the one with the wallet.

Let's talk about these guys with wallets. who are they? They are the owners. Maybe they have some NFTs representing community membership, an ENS name, an ETH or USDC balance, maybe a smart contract associated with them. They can sign on the internet.

It's funny how these people behave: they really want to associate wallets with stuff. They always connect their wallets to dapps, or connect their wallets to NFT marketplaces.

how so? Because what we own through our wallets means who we are. When we show up with our wallets, we show up as who we are. When we connect our wallet and feel the magical moment when the world suddenly changes — it sees us, it opens — that’s a pretty awesome feeling. It feels like this:

What's happening in this photo? It was the Doodles event at SXSW last March, a pop-up world created by the Web3 community Doodles.

The event is open to everyone, but if you're a Doodle holder, experiences out of this world — from the entrance all the way to the Shopify-powered gift shop — are "open" to you in delightful ways. Lights flash, bubbles blow, and special passes are held in hand; doodles of your own doodle appear on a giant screen, announcing to the world: "I am Doodle NFT holder number 3125!" One after another, guests There was joy on their faces; everyone had successfully entered this new world.

This moment is what tokenized commerce is all about. You realize, “Ah. Now I finally understand the relationship between NFTs and commerce.” NFTs are not an output of commerce; they are an input of commerce. NFT is not a product. They are a kind of status symbol for buyers.

Moderator: I like two things you mentioned,

1. Experiences can be open to anyone, but more special to NFT holders. I think music NFTs are really representative: anyone can listen, a few can obviously be big supporters, and have access to special tracks and meetups, etc...

2. I said it again. Encryption makes people what they are.

Alex ：Being an irreplaceable buyer is a good thing. You arrive at the storefront, connect your wallet, and suddenly the storefront changes based on the NFT you hold. Maybe a special product is unlocked, or you can get early access to a drop. Maybe you connected your wallet to unlock a high-quality art print or 3D model of your NFT counterpart. Maybe you can access a special collaboration: for this limited edition drop, your NFT opens a new door to another community. The more you explore, the more doors you find.

Specifically, NFTs have proven to be the perfect catalyst for this behavior. You know why? Think about what the most successful NFT brands look like. It looks like a theme and variation: this is what you fit in, and this is how you stand out.

They're a status symbol of that fulfillment: I'm in a doodle, I have this doodle. I'm on the Adam Bomb squad and I have this Adam Bomb. I'm in the Stapleverse and I have this hooded pigeon. NFTs are the new meaning of "adapt and stand out" on the internet.

Moderator: In my opinion, this is one of the cooperations in terms of scale. In the local community, we are naturally irreplaceable buyers. You go to your favorite neighborhood stores and restaurants, and the people there know you and know what you're going to order before you even speak. You are part of the local community (you "fit in"), but you are who you are, with your preferences and distinct style, etc. (you "stand out").

Alex ：Yes. It turns out that the act of "adapting, then excelling" is one of the most important raw materials for so many good things in the world—culture, community, business. Now we have wallets with NFT listings that represent this precise atomic unit of behavior: fit, then stand out.

Of course, this “fit in, then out” feeling isn’t unique to cryptocurrencies. It's a universal feeling that gets better when you give it back.

My colleague Nicole has an anecdote about walking around the mall with a large Sephora bag (not the small bag, the big bag you get when you buy too much to fit in the small bag) and realizing that others have too A big bag. The two of them immediately thought of the same two things: 1, it's great that you carry the same style; 2, what's in your bag? One of the engineers on our team felt similarly when she saw other people wearing their Medal of Engineers rings. I used to tour in a band, and now whenever I see someone on the street wearing a concert t-shirt, I get that feeling.

The acknowledgment is contagious because you both feel great. It's a feeling of mutual inclusion: I let you in, and you let me in. This is the challenge we do together: we all adapt and excel. You can see it in every neighborhood: athletes, collectors, people who like bands and live music, and people who like comic books. Anywhere you see the feeling, business is just around the corner.

Great brands understand this concept very well. When you shop at their flagship store, it's evident how much care and craftsmanship has gone into creating this environment of mutual recognition of achievement: not only in decor and aesthetics, but more importantly, in your interaction with the merchant. It can be very simple, that is, the businessman sees your T-shirt and nods, yes.

Especially since that endorsement qualifies for some extra discounts like, "What's that hoodie? Spring '18? Okay. Hey, we've got something for you in the back that I think you'll like." .”

Bobby Hundreds (from LA streetwear label The Hundreds, and of course Adam Bomb Squad) wrote a book called This Is Not a T-Shirt, which I highly recommend, really emphasizes this point.

Moderator: Yes! So I guess that's the second meaning - in the actual community you live in, people might recognize you as you. One level up, wherever you go in the physical world, other people who enjoy what you do are likely to recognize you as a kindred spirit. But that's hard to do online.

Alex ：Yes. Before wallets, that magical moment of being seen was hard to create online. It can be difficult for online storefronts to conduct a vibe check on buyers and respond to them in a way that recognizes and celebrates the social contract. Customer accounts and loyalty programs don't cut it; they're not you, unlike your wallet. A customer account is basically a part of the store, not a part of the buyer. In contrast, "connect your wallet, get recognized" is a special feeling. This is different.

Moderator: Okay, that makes sense, but there's a big unanswered question for me. When I read about "tokengated commerce" or "x-gated commerce," the first thing that comes to mind is, "Why on earth are you ending your commerce? If you're selling something, why don't you reach the widest possible audience?" Why not just checkout with one click?"

I was going to ask you, you've spoken a lot before about the importance of maintaining some barriers to building trust in what you classify as "high trust business." Tokenized commerce feels like a deliberate way to introduce a little friction into certain products. right?

Alex ：100%, I think the solution to this problem is to replace the word "friction" with the word challenge: Tokenization is to add challenges to some products.

The default state of the world is not "everyone wants your product". Creating demand is an art: you create a story and a challenge, and then you wrap the challenge in an adventure that buyers and merchants go on together. Consider flash sales or limited releases; these experiences are fun, and they're all wrapped up in a story. You'll be the one to get the drop, and that's half the fun.

However, this is actually a good time to revisit what you said about encryption and "collaboration", because one of the things I'm most excited about in tokenized commerce is collaboration.

Collaboration is the lifeblood of creative work; ask anyone in music, streetwear, or any scene. But online, how do you organize a collaborative merch for one group of people: my followers and your followers? There's no traditional way to do it that's both exclusive and unwieldy. But tokenized commerce makes this so easy. Connect your wallet and use any of these NFTs to access the drop. I let you in, you let me in. It's that simple.

I'm particularly interested in the challenge of how tokenized commerce can help brands recognize each other. I think of "endorsements" as a special subset of collaborations, where an established artist hosts or co-develops a label with an up-and-coming artist. (The music industry does this particularly well.)

We should be asking: How can one community support another up-and-coming community on the Internet? Collaboration through Token: When two brands come together, turn exclusivity into mutual inclusion.

What is Token Cooperation? When The Hundreds collaborates with Deadfellaz, you can use NFTs from any of their collections to unlock limited-edition items, a Token collaboration. When Superplastic cooperates with Gucci, the cooperation is limited to the holders of the secret SUPERGUCCI NFT, which is Token cooperation.

This is where the magic starts to happen: I belong to my community and you belong to yours, but when we work together, I can invite you to join; you can invite me to join. Tokenized cooperation transforms exclusivity into reciprocal inclusion. A century-old brand like Gucci can speak for a very popular brand like Superplastic, and their fans are inviting each other to this shared experience and the shared community they now have.

Moderator: So there is an obvious question, why does tokenization make commerce better, and why is this different from brand loyalty programs or promotional codes?

Alex ：So, I can give you a dodgy answer that re-emphasizes the idea that "challenges feel good" - when you spend more ETH on precious NFTs, using it to unlock tokenized products feels like a Achievement. But for tokenized commerce to truly reach its potential, we need the next generation of cheaper tokens (eventually, negligibly cheap), many of which will be more useful, and less of a "challenge" is its own reward" ,do you know? So we need a better answer to how tokenization will succeed in the long run.

Loyalty programs, promo codes, or any other type of "account-based" threshold system could be used for reciprocal inclusion - of course - but there's a catch. This is because your threshold rules will exist as dependencies referencing back to accounts and permissions, and they can quickly become complicated if you try to introduce any kind of interesting multiplayer mechanics.

Imagine having a pop-up storefront for fans of four different brands, with multiple levels of access, giving you early access to merchandise drops. Where are you "logged in" and as what? What if you are a member of multiple communities - do I need a code for each community? How do you prevent promo codes from being abused, the more variables you throw in the more complicated it becomes? I mean, you can do it, but social threshold rules built on dependencies quickly collapse under complexity, when the fourth wall is broken and the "exclusive community vibe" is ruined by buggy software , which is not a good community experience at all.

In contrast, Token is a bearer tool - it is more like a document, or a physical ticket in your hand. (This document analogy will be important later.) The NFT doesn't "link back" to anything, it's not a reference to an account entry on one or more merchant databases; it's the ticket itself.

In the case of what we call "single-person mode" (a merchant's threshold control over a single customer list), it is difficult to see the advantages of tokenization. However, once you get into multiplayer mode - where multiple merchants connect with multiple groups of fans through a set of social rules - tickets are a bearer tool that doesn't link back to anything and thus create no dependencies - but Still being trusted by a "gate" even though it's not linked back to anything (more on that later, this is the "why you need a blockchain" section) is a radically simplified mechanism. Because now, token threshold control rules can get super complicated, but they don't collapse under the weight of dependencies because there's nothing to collapse.

Moderator: Talking here is a little enlightening moment for me. Some of the killer use cases for cryptocurrencies may be big, wild, and unimaginable, but some of them are just, “making the same thing so easy that more things are happening now.” The stablecoin track is here in camp.

Alex ：I feel like this actually preempts a feature I want to feature in the future, so I'm leaving it here. But for now - when we look back ten years later in 2022 and ask: "What was the answer that was really obvious and in front of us during that time?" I think one answer is, the threshold of cooperation Tokenization The control mechanism will greatly simplify the way brands collaborate and recognize each other, and this simplification will mean more multiplayer opportunities for community commerce.

Furthermore, the cooperative tokenization threshold control mechanism is an inherently superior form of anything that involves remixing that the community can sanction: In our threshold control cooperative tokenization example, we are not trying to target a specific set of people. Threshold control, but rather a more flexible and remixable form of gating a specific set of achievement-holders.

I want to double down on this idea by emphasizing that NFTs are your list of accomplishments. NFTs represent you.

Today, we see Web3 brands and legacy brands that have tokenized their online stores well suited to this path, bringing these storefronts to life through tokenized application partners. The depth of collaboration with these app partners is incredible and we're building with them - more on that later. In the meantime, we just released a demo of a new mobile app for tokenized commerce: Gated Merch Shop ("gm shop" for short), you should check it out. Over the past few months, we've really fallen in love with building incredible, mobile-first, single-purpose, tokenized commerce experiences. I'm so proud of the team that built this; it'll rule over everything!

But it's all just a crack in the door of possibility. What happens in the backyard is more interesting.

Now that we've set the footnotes on all the issues by introducing tokenized commerce, and how important this idea of ​​fitting in and standing out is for commerce, we can talk about why it's important that this all have to happen on Web3 wallets and public blockchains sex.

The word to remember here is: "We're going to make Shopify wallet-aware."

To really understand Shopify, it's first important to realize that we're not just an online store service for merchants; we're also a developer platform.

Every storefront is unique; if you go to any good merchant's storefront, it's not just Shopify out of the box, they're probably running a dozen or more from different developers (or built it themselves) apps, all of which work together to create the exact business experience (that merchants want to represent their business). When you sign up for a subscription product, or browse cool content on the storefront, or connect your wallet to unlock a closed product, it's all powered by resellers and app developers - just like you do on your iPhone Most of the things are built by the app developers, not Apple.

Well, we want wallets to be the new input for developers building on top of the Shopify platform. NFTs in your wallet are much more than "to have or not to own an NFT". NFTs are information; it's a smart contract, and that's important.

This is what we mean when we say "make Shopify wallet-aware".

When a buyer shows up at the storefront, if they show up with a wallet, everything that their wallet can endorse, including all the public, social meaning that the buyer wishes to make, should be available to the buyer.

These developers can take all relevant state and build various applications and mechanisms that can take that state as input. There will be a version of the very successful Shopify-based apps that empower storefronts in the future, and today we already have four amazing tokenized apps (PERC): Engage, Manifold, Shopthru, and Lit Protocol - for merchants Provide tokenized business support.

The best Web3 brands won't wait. They are creating intricate and intimate experiences for token holders — new ways to craft merchandise drops, new ways for brands and their buyers to collaborate in multiplayer mode. The beauty of having an app ecosystem is that developers can reuse, iterate, improve and ultimately share these mechanisms with many merchants and brands.

Moderator: This is the best part about new primitives: the community will think of all kinds of uses that even the creators of the primitives would not have thought of.

Alex ：To give you an idea of ​​what is possible, I want to go back to the idea of ​​NFTs as tokens representing social achievements and social contracts on the Internet. NFT is a more significant achievement than you might imagine, because we've managed to package this atomic unit of culture and community - fit and stand out - and capture it almost as if in a file format that both humans and computers can interpret and understand .

It's a big idea, so let's tear it down. What are the four things the NFT in your wallet has to say?

- what fits you [smart contracts; a community; context for social understanding],

- How do you stand out [which NFT did you sign in that collection],

- who are you [your signature wallet address],

And then one more thing, such a simple yet so important addition of genius:

- Human-readable images, making them instantly recognizable.

I, alexdanco.eth, for the Adam Bomb Squad, I stand out as the owner of Bomb #6233, a clean blue Disney style trap design.

I know it sounds ridiculous, but it's actually an impressive achievement; it's like we have an accepted standard for a file format that creates an atmosphere on computers in a way that not only faithfully preserves and Carrying on that vibe, and more importantly, the other things you can do now that you have access to a computer.

This all might seem a bit silly indeed, but something very powerful is going on here. We now have ways for computers to recognize and understand these units of social achievement; that's what these little pieces are, it's almost like files (they're a lot like files! That's what I was talking about before!) in this way humans and computers Both readable persistent small format stores social meaning. Through a small miracle of social coordination, it is gaining widespread acceptance.

NFTs (and other smart contracts on the blockchain) are an intermediary format - between the environment that establishes this social meaning and another environment that deploys this social meaning (wherever you connect your wallet) - this One fact is important. It's almost a step back from web2, back to a world where one app talks directly to another app through an API, back to earlier times, and we get a deeper correctness; we're rediscovering something called composability sex.

The basic idea here is that if you want one application to successfully communicate with another, then it's easy; you just tell them how to do it. If you want one app to successfully talk to 100 apps, you can write a nice API that says, "Hey, a hundred apps, here's how to talk to me."

But what if 100 applications want to talk to 100 applications? Many connections need to be maintained. Therefore, we can use something else: files. If I want to pass information from one application to another, I can pass it as a CSV file that everyone can understand; no dependencies are created between whoever makes the file and whoever consumes it.

So an important principle to understand here is: strictly speaking, for any task or any work to be done, it will be "better" for App 1 to talk directly to App 99 than to go through an intermediate file. But over time, the power of documentation is revealed through the power of standards. Because they have a common format, they agree on how to read and write to each other, and that content exists in a common place; on disk, or on the network, or somewhere accessible and durable.

Moderator: So why not pass it as a text CSV file? I feel that as someone who is excited about Web3 but understands that some people are skeptical about many use cases, I always have a responsibility to ask: why is blockchain needed? What does Web3 allow here that you can't?

Alex ：aha! Yes! So we finally get to the question of why you need a "block"!

This is because we need to solve the problems that the blockchain is actually designed to solve, i.e. provable scarcity and double spending. These "documents" need to exist somewhere in the public state, in a code environment where commits can be made, in order for their social meaning to actually make sense. "Web3" is such an environment - made possible by a publicly agreed blockchain state - with sufficient group confidence in these "intermediate documents" to achieve social significance.

So if we go back to the present and ask: "What is Web3?", for me, the most practical way to think about it is that "Web3" is just as an environment to build consensus around a new set of standards: everything is a smart contract address, Everything is a tokenID, everything is a wallet address.

The reemergence of these blockchain artifacts as intermediate "files" means that interoperable, composable social mechanisms are now truly competitive - and, I think, starting to outperform - closed, "Web2" style social A network mechanism where everything happens in one application, or as a cross-dependency between different applications.

I think it's going to be pretty crazy for business. Especially in the most special and meaningful community businesses, we are constantly inventing and recombining new ways to express who we are: how we fit in and stand out. The best part is that the idea is so open and developable that no single company or single application can "solve" this problem on its own. it's out of the question. Culture is so interesting; we need many apps, many developers, many attempts to capture these forms of community expression - starting with tokenization, and then expanding to "tokenization can actually mean a lot of things".

So, that's why I've had such a good time working at Shopify - because we're not alone in this game, we're a platform, and tokenized commerce really showcases the best reasons we chose to build: Shopify as a platform, Everyone can join.

Moderator: So this reminds me of great online games, partly because we're playing this infinite game, and there aren't necessarily winners and losers. I can see what that means to people, but Shopify is a company. What does it mean to win or lose in a corporate setting? How do Web3 and "real world companies" mix?

Alex ：I want to go back to our original thinking; wallets change the way people behave and in the long run, this behavior will win. I want to pay special attention to one word here: "win". What does it mean for this behavior to "win"?

It doesn't mean that we win and everyone else loses. Winning means we can keep playing. We play so that other people can play too.

Our tagline at Shopify has always been "Make commerce better for everyone," which is great, and that's what we're here to do; but over the past year, another purposeful tagline that I really like Started to appear: "Win and help win."

I think the game we're playing has no boundaries, it has a pattern: when you go to the horizon and explore it, you can't explore it all. The horizon is always with you. I hope everyone in this world thinks like this: There is no Web2 and Web3, only "bringing the best version of the Internet to the most people". This is big picture thinking. When you help others win, you win too.

Moderator: Do you have any suggestions for our audience?

Alex ：Well, here are some suggestions:

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