(A journal entry originally written in September 2023 after meeting crypto builders from TOKEN2049 and Korea Blockchain Week)

The future of the blockchain and web3 industry hinges on its downstream impacts on the mainstream global economy across all sectors, including but not limited to: finance, banking, payments, remittances, foreign exchange, privacy and identity, advertising and marketing technology, social media, and gaming. Over the past 10+ years, since the birth of Bitcoin, the infrastructure pieces have gradually come together, and although they're still evolving, a lot is working well already -- RPC nodes, indexed APIs, crypto wallet SDKs, smart contract templates and auditing services, blockchain explorers, analytics platforms, DeFi exchanges, liquidity aggregators, and so on... However, negative pressures like anti-crypto regulations, fear of scams, bad media coverage, lack of liquidity, and a still small pool of technical talent, means that the existential threat to the crypto industry is still very real. That's why I'm really excited about web3 projects that are using blockchain technology to enhance the economic experience of its customers in a healthy and sustainable way.

One example sector where I see the most exciting progress is web3 gaming.

Of course, there are and have been many crappy web3 gaming proposals and experiments over the past few years. Duskbreakers from Metatheory. Aavegotchi. StepN. CryptoKitties, HamstersGG, Sandbox. None of them really have been able to prove themselves to be fundamentally fun gaming experiences. They all have gambling baked in as a core value proposition, which is a useful way to onboard new consumers because gambling can be an endless form of entertainment -- but gambling alone might be unsustainable if there aren't more wholesome and productive activities to balance them out. So then what would a successful, sustainable web3 game look like?

The key is: Decentralized IP (Intellectual Property)

What is Decentralized IP? Let's break it down. First and most importantly, we need to start with the IP itself. Valuable intellectual property comes from content, marketing, storytelling, culture, and creative processes. I'm specifically referring to the likes of Pixar Animation Studios, Shonen Jump, Marvel Comics, Blizzard, Riot, Roblox, Pokémon. Something that every one of these juggernauts have in common is that they've created shows, movies, merchandise, competitions, secondary marketplaces, loyal customer communities that act as buzzing mini-economies vibrant with creativity, connection, and continuous flow of value. They created experiences like Hayao Miyazaki's "Spirited Away" -- a beautiful and immersive experience of growing up, making friends, fending off the evil within, and saving your own family from death. They are the source of memes and the equivalent of modern-day bible references. Humans are social creatures, and high quality IP creates the fabric and seeds the background conversation of modern culture.

Now, where does decentralization come in, and why is it important?

Currently, these creative and experiential endeavors are usually conceived of, executed on, iterated on, and owned by a central party, usually a public or private company for example. However, successful IP always exists and flourishes beyond the scope of these centralized parties. Cosplay, fan art, trading on secondary marketplaces, private servers, influencers, media coverage, etc. These things all require loyal customer and community involvement. What if these things didn't "fall beyond the scope of the centralized parties"? What kind of a leadership or governance model would allow for more creative flourishing?

I'm seeing some interesting experiments that show signs of hope because of their approach to seeding the initial IP and building partnerships and platforms that foster potential ecosystems to grow. By having blockchain-based digital assets at their core, they allow players, creators, builders, and investors to freely innovate in their ecosystems without the heavy-handed approval processes of most non-web3 brands.

1. Desktop game

2. Mobile game

3. SDK for developers to integrate IP and currency into custom apps

4. Sandbox

1. 2 Desktop games

2. Mini mobile games

3. Content, shows, and physical collectibles

4. "Kevin meme"

1. Virtual avatars

2. Access to live and digital events

3. Revenue share between platform and creator

1. Plushy sales and viral content

2. IP revenue share via Overpass platform

3. Valuable personal network via NFT holders

A key idea is that when IP becomes truly decentralized, anything that you do (as an individual consumer or creator or investor) in the IP's ecosystem becomes part of the ecosystem's economic game. As a consumer, you might purchase a plushy or spend hours competing on the online game. As a creator you might produce videos and blog posts explaining the lore of the brand or you might even build a business leveraging the IP ecosystem's distribution abilities. As an investor, you might purchase NFTs or tokens that represent the brand and incentivize consumers and creators to contribute to the ecosystem in a way that helps your investment increase in value. All along the way the original brand team's role is to steward the ecosystem so that all the different stakeholders are happy and stick around. But the brand no longer needs to control every action. And all the stakeholders can benefit by being shareholders of the IP. The IP is decentralized via digital assets on the blockchain. The ultimate "web3 game" is participating in a blockchain economy itself. Web3 IP IS the game!

The more that these initial experiments succeed, the more playbooks and frameworks we as an industry can apply to accelerate and benefit everyone else in creating more free, efficient, creative, and supportive ecosystems.

I'm super bullish on this industry -- it's just a matter of time.

More thoughts to come...