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This is web three breakdowns web 3, breakdowns is a series of conversations, exploring innovation in the decentralized internet. Each episode. We will focus on a different topic. We will cover nft projects crypto assets, blockchain based, protocols and businesses. Being built with web, three architecture. We will talk to Founders artists investors and influencers to understand this emerging.
Item, come join us down the rabbit hole to find more episodes transcripts and a library of content to continue your learning visit. Join Colossus.com, all opinions expressed by house and podcast guests are solely their own opinions posts and podcasts maintain positions in the Securities discussed in this podcast. This podcast is for informational purposes only and should not be relied upon as a basis for investment
decisions. My guest today is actually Infinity co-founder, Jeff Gio's erlin the Colossus team.
Over the axi origin story and September of last year, but we felt it was an ideal time to revisit the play to earn Pioneer. Gio and I cover his involvement with the axe ecosystem including gameplay the economic model and creating a side chain. Please enjoy my conversation with you.
Giada, thank you for joining today. I really appreciate having you on the show. When I first met Geo at n FC. Basel. I was introduced by a friend. I started out talking to him about a taxi. He's extremely patient with this time, and I noticed a group of people around taking photos and they weren't taking photos of me. There are waiting for autographs and taking pictures and it just blew my mind at how many people from all over the world. We're just so excited to see you. Down in Miami. Later the day I saw you shooting what looked like the music video. So I really felt like you're one of the rock stars.
And crypto I have t is gaming. So I appreciate you coming. Today, you grew up collecting fossils, playing World of Warcraft. And you wrote a thesis about speculative Bubbles and economic systems and college. So I really can't think of anyone better to create an economic structure in a game. But I just be curious to hear your start. How you ended up in actually like where it all began.
First and foremost. I want people to know that I joined the axi community as a community Member First, I bought three axes. I thought,
Her cute, I was from the cryptokeys community originally. So there were a subset of early people. In the end of t space that we need actual utility, pretty things. We need to be able to create memories with them, for their guy, actually be sustainable economic value here. Needs to be some sort of Social Capital backing it some fun this thing like okay. Hey taxi is actually trying to execute on this Vision. So I joined as a community member started building step-by-step helped with the initial. Why?
Paper started doing some Community Building initiatives and things that really just started to snowball. I think I was attracted to axi I was attracted to nft is because I grew up as a collector and a gamer that side of the brain is where I thought that was my circle of expertise. I guess I grew up collecting insects with my father. That was the way that I could impress him. Just like, any kid, I think once to impress their parents and he son wants to impress her father. That was my way finding a rare book.
Ugh, finding a rare butterfly. On the other hand. I was an only child. So I spent a lot of time by myself and video games from Donkey Kong Country. I'm the Super Nintendo onward were away from me to basically entertain myself when I didn't want to read anymore. When I was at home. I would either read or I would play video games. My cousins are Korean, so they would come and that would be like, the best thing ever because I didn't have siblings. They would bring Diablo.
Starcraft they would introduce me to these blizzard games. That's how I got introduced to the internet in 1997. I was on Battlenet, playing with anyone anywhere in the world. I knew from an early age. That gaming is a great way to demo and test out new technologies and often most relatable use case at least me. So when I found out about an MTS, those like hey, this is more interesting than what I've seen in the past from crypto. I was interested in crypto. I understood the digital gold case for Bitcoin, but that was wearing to me, I was more into
Accumulating as much Tesla as I could back, then 2013-2014, if I wanted to just speculate and try to make money already had a lot of ideas on how to do that. So blockchain wasn't interested in to me until I found out about a nephews. I kind of went down the rabbit hole was a, cryptic kitties breeder for a couple of months there, and then I found Oxys. I was just lucky where I was part of the first initial cohort to do that.
Maybe to take a step back as coming to it from a gamer because I think there's an interesting narrative going on right now between
I'm gonna have to use. Can you talk about the Arc of gaming? Like when I was a kid? You bought a console, you played a video game. I think that my gaming career probably ended at Halo. So I'm not a gamer because all of a sudden gaming was becoming something you could get really good at, and it was harder to play. So, just give a sense of buying a console, playing a game to the evolutions of where we are today.
We've had digital economies for a long time. They've just been more authoritarian and the tax rates have been approaching 100% when I played the
Hablo, I was just trading items with people trying to get better stuff and World of Warcraft. My guild we used to gear up and the Chinese gold farming operations would pay us to gear up their stuff. We'd always run into TOS, violations, get our stuff. And there's always been this gray or black market for these digital economies. They've never been embraced. It's always been secondary. Whereas the way that I see it is, the internet has a problem where we don't own our data. We don't own our digital identity.
Our game items are part of this issue and I see Gamers as citizens were spending more and more of our time online. We're becoming part of these online communities. Just like we should own our data. We should also own the game characters. We should own the in-game resources. We should be able to as Gamers even own parts of the games that were using. And I think that's a big part of the ethos of web 3 is products, should be owned by the communities, that use them. And how do you actually facilitate? That is the extraction of middlemen?
When you don't have these middlemen, extracting 50 to 60 percent of the value, then you have all this other value that you can actually give to the people that are so crucial to the functioning of these products.
Maybe now would be a good time to introduce for the people who haven't heard it adjective interview last year. There was a deep dive into Axia, but I know a lot has changed, maybe a high-level overview of what actually is. How does someone play it
back? See, is on the surface very similar things like Pokemon and Tamagotchi. Each axi is a digital pet. They're cute. They're
As you can battle them, you can collect them. The key difference is that an acci Infiniti? Everything is tokenized from the game characters to the items, the land, they're even tokens that represent ownership of the game itself. Basically, we've embraced this idea of crypto economics. We've infused that into the ecosystem to make this open player driven economy. And then once you have this base layer of property rights, interesting stuff started to emerge, we couldn't have predicted all of the things that would start to
to emerge. But that's what happens. When you give freedom to people did the founding fathers envisioned, everything that would happen with America. Innovation starts to pop up when you give people more rights and let them Express themselves without trying to exert as much control. As in the
past. I'm curious to hear a lot about how whatever you thought this was going to turn into versus what it did. But to give a little bit more context of just a size and scope. Could you put some
Around how low our taxi is today? Because I think it will blow people's minds.
There are three million people who own axes the Ronin wallet, the digital wallet associated. With our ecosystem has hit four million downloads. 50 percent of our users have never used web 3 or crypto prior to playing axi. We've done three point, eight billion dollars of nft volume that make sexy the number one and ft collection of all time, we built our own scaling solution or own side chain to allow us to hit.
Has of users that side chain alone. Through axi processed, 15% of all and empty volume in 2021.
I think on that number of 3.8 billion there really is nothing in comparison. I think I was looking at Top Shot. It was 800 million dollars, which is a huge number but actually is four times the size and total sales as well as the number of people that use. It is just outstanding as someone who's participating in nft and crypto and defy axi to me really feels like a separate nation.
Talk about founding fathers and I really appreciate you. Sharing your thoughts on developing something like this. I think, for people who haven't played axi. It really feels like cryptos, got a steep learning curve, but actually has it's almost second steep learning curve. How do you think about onboarding new people and then learning about accessing?
We think that onboarding and education is a lot of what we bring to the playerbase. That's almost a primary value because we believe that web 3 is going to change the world. We believe that cryptos is going to change the world and by
By being that first gateway into this entire new universe for players. We think that we're changing their lives. If you play FC, you're going to be one of the first few million people, to actually actually interact with web tree. You're way ahead of the curve. Think of the people who use the email and the 1980s, probably like help them out. Opened up. A lot of opportunities. Give them a glimpse of the future and where things were going. We believe that that is a core benefit of our product and we take it really seriously.
I think we could do a better job at it. We're still learning. We're getting a lot of feedback. Iterating on our messaging communication. What are people confused about? It's so important. I think it's almost our core offering we're looking at being able to issue diplomas to our players. Almost this is really a Hands-On course in the future of the Internet.
It's a quote from you that in 2021 you start off with something that just under 30,000 active users and your goal was to get to
Thousand and you ended up at 3 million that type of exponential growth and usage. I can imagine cause a lot of different challenges along the way and having to reshape how the game works. How people interact with it when you look back at the early days and actually, when they set out obviously, the growth is a wonderful thing to experience. I'm excited to dive into some of the changes you've had to make the balance, the ecosystem, like our friend Hamilton, but in the beginning if you can think back to playing crypto kitties, what did you think? That actually could be?
Out in the early days. We really saw this social aspect of it. We're even before we had a game, people were hanging out with each other, becoming lifelong friends. So we almost pitch taxi as a social network in the beginning. If you go back to my product hunt upload in 2018. It's like axius a digital pet Community. Doesn't say the Act is a game because we see it as a community communities Nations. They're bonded by Common experiences, fun things that they can do in common. I think that's almost there.
We saw the game. We definitely saw the social impact. One of our core ideas was Gamers, should be able to turn their time and effort into real value because they are creating real value. Just depends on how is that value measured and captured and distributed among the user base. This is going to be a highly social experience. Gamers are creating a lot of value. How do we allow them to capture more of that value? Those are a lot of the things that we're thinking about in the early days. We learned a lot from watching crypto kitties and being a members of that Community. How do we capture some of the things that
He did well that caused it to be interesting. But also make some core changes that allow it to be sustainable and much more fun of an experience.
I love the diamond. Now to economic structure of this is on your background of adding SLP token and a excess. And when people think about games, I think creating a game is really, really hard. A sustainable game is hard what you guys have introduced by all these levers of economic structure has made it exponentially difficult. So, I'm curious when you thought about
Not introducing those pieces. How did you think that interweaving them into the game would work?
A lot of it was talking to the community. So in the early days people would join our Discord and say how can I earn tokens by playing this game? Like, oh, I'm here to earn Mio tokens. I want to earn this token by playing the game. Really why people like keep asking about that? People love tokens and crypto. This idea of there should be a game where you could actually discern tokens by playing the game. It seemed like that was something that might have product Market fit.
We're not crypto people or not gaming people, but Trung our CEO. He is, I think a product person first and foremost from our users. We could see that they really want to play a game in our tokens describes. Well with our idea that people should be able to get some value. So then it's like, how do you create a token? That's emitted by playing a game that can potentially have a nonzero value. That was a question that we started to think about that. Led me down into the defy rabbit holes. That's where a lot of the experiments.
Ants and touka namik design was happening met delfi digital through that whole experience studying the major token Khyber snx. Some of the early defy experiments are initially. There was a core Loop of you battle-axes, you get experience points to use those experience points to breathe, but then we had this idea that you don't actually own those experience points. Those experience points are an in-game resource. So it should also be a token. We made those tradable. I think our community really pushed us towards that.
Once you're a token Community took over and a lot of ways, they created the Unis swap pool and they created this model, the scholarship model, your lending out axes to people and less privileged parts of the world. You're creating this game as a supplementary income stream concept. We were just iterating in public with a couple of core principles and we started to see these really interesting behaviors start to emerge and many ways. This is similar to hear him. Etherium is main use case in
C17 2018 was Ico platform. I think the talaq wanted that or imagine that probably annoy them in some ways for it to be branded that way. And then we had D Phi and the rise of n FTS different narratives. Different use cases for oxy arise and sometimes fall. Why? Because it's more of an open platform. It's something where the community can try out experiments and open economies that have real
Stakes. It sounds like the ethos of you and Chong. And other Founders was always let the community owned as
Of this as possible and you're iterating real time. So you basically have a game where version one, you own the assets and you get points, then you own the assets and get tokens and those tokens could be converted back to dollars. So now you have a yield bearing instrument essentially where by playing the game, you can generate money. I think something that did make a lot of national headlines was this notion that there were people in countries that could afford the axes by the nft. They could then lend them to developing nations. The one that was
The largest on the platform was the Philippines and that they could, then basically let the people of the Philippines play for free and then generate an income for them as that evolved. What was it about? The Philippines? Was that all organic or how did that happen?
It was very organic. That would say there were a couple key missionaries on the ground. There. I meant Gabby in 2018, went to Manila. I went to the Philippines a couple times, planted the seed with Gabi Gabi. I think was very open to it and I gave him some axes and it was just like he knew more about
Future vaccine than me. I think at that point where he's like, all this stuff is going to happen. Get ready. Your life is going to change, millions of people are going to get into this. Philippines traditionally early to social networks, massive Mobile gaming culture, very community-based, and family structure, is really importance of information creds, like wild cards,
what happened to that structure? Where let's just say, I bought a bunch of assets or Gabby has them and he's letting them out what happens in that process of then they're generating income. Do they end up buying?
Actually themselves and then that structure breaks down. So it's no longer needed or how does that work?
The Gilligan thought long and hard about this. They see the scholarship model is just a first step in someone's web, three Journey. You should eventually go on to owning your own nft, s owning tokens and ownership and these protocols becoming someone whose web three literate. Web three literacy is going to be a huge industry. In my opinion. It's going to be so important people just see
Webb 3 as this giant cash generating machine, rather than something that is giving freedom to people and addressing a lot of the social issues at the heart of globalization automation of Labor. How do we find meaning? And how do we have Dignity of work in a world? Where many types of jobs are being destroyed? And this pursuit of meaning? These gills. They want Scholars to become fully integrated into the
This whole crypto economy you're using that as a stepping stone
diving into that point about the meaning and work. If you had told me you were going to try to get three million people coordinated in an economic way and you came out of cryptocurrency. I would have been that's really hard in this notion that it was the game first, but then you're teaching second. Was that always a mission that the idea was the game is just the door to get people in or was this a secondary vision for the team?
The vision definitely expands as we execute different people have different Visions to a lot of us are dreamers and the early team and we thought that hey, this is something that could really on board billions of people to web 3. If we can do that, we can actually change the future of the world, future of the internet because this is a technology that has been until now inaccessible to Everyday People. I think anyone who's ever tried to use a bank, these days knows that there's a lot of room for improvement in the current paradigm.
Times people don't understand of under internet people don't own their money. If you talk to the people who created the internet, they're all investing in web three, why? Because they didn't know how to solve this problem when they launched the internet. They didn't know how to create long-term social and economic relationships that are intertwined between people anywhere in the world. That's why eBay has to have the trust score. There was no way to embed that into the early days of the internet. Now, we have a solution now the
And actually reach its true potential and you talk to the people who are around in 1995. They may be behind the scenes are running huge funds, but they believe in it
was generally a tremendous amount of excitement across the board and that area. One thing I thought was one of the most interesting stats about axi, was this notion that 50% of people play acci had never bought crypto before axi and then even more importantly to me, is that 25 percent of them don't have banking relationships, and I think that
That's something where when someone might just superficially look at the cute little axes and they go, it's a fun game, like any app on the iPhone. It really doesn't even do justice to what's possible to happen. So, how do you think about that population? And what actually could do
these massive potential here, where we're starting to already. See that in certain parts of the Philippines. Venezuela Merchants are accepting our in-game resources for goods. People are using Ronin wallet, instead of G cash or whatever, and I didn't have a bank account for so long. When I lived in
Nam modern banking. Infrastructure is so primitive and so difficult, even for someone like me to access in comprehend. Whereas the Next Generation it's going to be these digital wallets where you actually own your funds. We can become a user aggregation layer. We have all these people using our wallet and that can integrate and be a building block for so much more. There are now Merchants that are interested in integrating running wallet as an alternative or as something
that you would add editions, who will dare you run into a login, whatever. And then you can even swap your in-game resources for e-commerce stuff. There's huge potential there. I think the future of gaming is to integrate gaming. Payments, e-commerce app stores. It has the potential to really do that. This is why I begins is fighting against Apple because epic games thinks that it has the leverage and that it has the true loyalty of the users players tend to be more
Loyal to gaming companies. Like then things that are seen as purely apps. There's a fairly tech companies.
When you think about the infrastructure you just walk through. You start off with a taxi. You have this vision for a game, you're opening it up and playing with tokens. You went on to build your own chain Ronan, which is a side chain to aetherium, your own wallet, your own decks, you built all the infrastructure of crypto specifically for axi and I guess I'm curious to understand when somebody does that. I usually think either.
They're doing it to control the whole system because they think it's a control or they're doing it because they feel like the solutions don't fit their needs. So, you have a purpose-built nature. What's the reason for building everything on your own?
It would have been a lot easier if we didn't have to do that. So, we tried we built on loom Network Giorgio. So is there we thought it would do well, but it was just too early. We realized that the crypto ecosystem in terms of building consumer apps. It was just too primitive. We're too early to be able to rely on other teams.
And then also is a realization of there's nobody, that's actually trustworthy that are building the solutions that we need. So might as well providing them for other people in the future. So people don't have to go through the same experiences that we went through that. We had to put our community theater.
If you are building our sea today and 22, how do you think about where the state of the infrastructure exists, crypto kitties eventually because of their troubles started building flow. You've got polygon with games. How do you think about the stuff that you guys have had to build relative to the state of the rest of the
Structure in the space.
I would build on the running is the thing that's tested at scale with millions of users. I don't want to comment on these other teams. They've been around their cool. A solution that specifically geared towards games is kind of what we want. Whereas a lot of these other things are trying to be too broad and trying to do everything for, as really, as they're focused on gaming experiences. So almost minimalist in some ways, but we do have this Obsession where we do go.
A lot of the stuff ourselves. We're like that restaurant in Singapore, where the chef is also hand car, turning the tables and the silverware, everything needs to be perfect or almost OCD in that way. And we're proud of people. I think that's one of our strengths. It's also something that creates a lot of work for us.
So as the head of growth, how does that affect your ability going back to that point about onboarding where you guys want to build to your standards and your specifications, but it's almost remarkable to me the level of growth understanding that a lot of the stuff is
Turret, you can't use a metal mask or rainbow while you got to use a ronin wallet. I'm curious in your mind. Do you look at that as a bug, a feature a huge accomplishment? Because people are still coming in light of that. How do you think about the challenge, is a product person and trying to grow the business.
I think it's an interesting that we've been able to build the infrastructure and build the game, alongside each other. There are some people who thought that's not possible or that's trying to bite off too much. It's created problems. It solves.
Solved a lot of problems, but how good would actually be if we could have just focused on axi for the last four years rather than also building something else, but I think also the current and empty space is still really, really early with Ronan. The onboarding became a lot easier in the experience became a lot easier. So, we're able to have this insane viral Loop. That's still a little bit stymied on eat. And if you communities on a Nerium are not focused on scale, it's more about actually exclusive.
Civility, whereas we're focused on inclusivity, where we want to bring in millions of people, billions of people. Obviously, you need to have both, you need to have the collectors that are flexing. We have them in our acts ecosystem. I'll say like because we have to focus on scale to I think some of them sometimes we aren't able to focus as much on that aspect of our ecosystem because we have multiple aspects of our ecosystem. But these are tough things that you go through when you're trying to do everything. Someone has to do it for the entire year.
System. And these are the times where you expand horizontally and just take up as much of the landscape is possible in these early days because of the timing, the opportunities, as much larger than it will be in five years.
I think about those personas. You have a collector. You've got an investor. You have a traitor, you've a gamer, you have someone just loves being part of the community and I can't even imagine how hard it is. To try to balance the different
stakeholders. It's like a politician.
And there is actually politics. There are people who are pro Sky Mavis, Auntie Sky. Mavis. Our approval rate is probably around 60 or 70%, pretty good compared to a modern-day governments and stuff like that. Obviously long term. We want to give more power into the hands of the community. In terms of product development. You need to be able to be agile and iterate quickly the main way that our community helps I think build so far. It's been they've done the marketing and the referrals. They've done a lot of amazing content creation.
In YouTube tutorials or telling their friends and family about our Movement. We just opened up this Builders program, where we have, 1800 people sharing their dreams of what they want to build on top of axius. Well, the community's role is definitely growing over time
just to have that topic of the different stakeholders. What are some examples of how you've had to try to balance? If you're the politician, dealing with the different desires. What's an example of actually, having to wait trade-offs of the gamers versus maybe the group that wants to
To hold a passive investment, a taxi or train or
coin. It's incredibly hard, but it's rewarding and some of the stuff that I grew up dreaming that I would have a chance to do. I was interested in being a politician at a certain point, but I didn't want to be an American politician, its nation-building, and it's very difficult, weighing the desires of everybody, but I think it's most hard when you're trying to do everything yourself. So by bringing them in to the process, and the cool thing that we see is you can look at Axia, the nation. You can also look at it as a hyper scalable.
Aiming organization. We're hiring. People takes a lot of time and effort and energy, gotta train them. It's so much more interesting. When you can almost aligned incentives with infinite people without having to go through all these hideous processes and they're all aligned. They want what's best for a taxi. They have assets that represent ownership in the ecosystem and they're working towards the same thing that you're working toward. If it was just Sky Mavis doing everything. It's not going to work. It's really really rewarding work and it's very
Very difficult, but the cool thing is that we have this hive mind that gives us huge leverage.
How many employees are at Sky made us today?
And we just hit like 105. We're around 30. I think in September. We just went through a growth spurt.
It's basically example of a rocket ship taking off and bolts, just hanging on. What were some of the top areas you needed to focus on outside of infrastructure, to maintain the community during that period
in like, sharing the vision. I think we should always
Share the vision more. What are the principles that we're building towards sharing? The vision of axi can bring freedom to the Internet by introducing billions of people to web three, we can share the value with our players. If we extract all these middlemen doing that has been super important, but also just executing on the roadmap in the early days, people were super excited. And then a month goes by two months goes by, you haven't lost something, people start to Grumble and then you'll,
Launch something. And then people are satiated those. People who are there for that period, they start to understand the process more. They start to understand the ecosystem. But then you start to grow. You have more people who come in, they start to Grumble and you have a new release. So I think just executing on. The roadmap has been important and bonding with the community. Also say that setting this roadmap you're dealing with Frontier Tech. So I think, like, Elon probably deals a lot with you have all these people that are excited about what you're building.
I want to know when they can expect it, but you're dealing with Frontier Tech. You want to give guidance or a forecast, but you don't want to be wrong. It's difficult of the crew. From 2018, 2019. Generally. They come to understand that process, but most of our players who started this year. It's a struggle. It's something that we go
through. One thing. I know for any leader is that people will say they're trying to be transparent, but sometimes I can't share something. One thing. I'm in. Awe of you specifically is how
A parent, you are even when it's negative for your own brand. You've done threads when things haven't gone the right way. I think this is why you get this status that I noticed in Miami. You're just sharing. I don't like this either. This is what I'm thinking about it. I can't think of any company in the world will be, like, Elon has a car brake and it's like, yeah, I think this is why it's crashing, but I'm not sure. And we're going to talk about it. You clearly have built a tremendous amount of trust with the community. I think. Now, what I'd like to hear from you is an acci, you have these levers, you've got
Can Steve got games, you got prices of breeding and you've changed those, and you've changed those to balance them. And I think this goes back to your thesis in college on Hamilton and trying to manage a government, but you're running a central bank. How do those decisions get made
even kind of catalog. The process internally is a little bit difficult. I think a lot of it is looking at the data figuring out if there are certain thresholds. For example, if there is 50% more of a token being created per day, then is actually being burnt Supply is 2X.
Demand, we need to start looking at something. If growth goes below product Market, fit around 5%. We need to start looking at addressing and making some economic changes will start to see awesome proposals from the community on, okay. These are the fixes that need to be changed. In many cases. We have to be aware that there can be a disconnect between us and the community, just like there's a disconnect in the government and Society because we are building the game, but the people in our community, they play the game.
18 hours a day, they live the game. So we also have to make sure that we have a way of getting feedback from the community from the actual entrepreneurs, in the economy. And seeing what their ideas are, there. Is this osmosis looking at the data, getting feedback from the community. And then also, the best solution is sometimes technically impossible or will take too long to implement. What is the MVP of these economic changes? It's incredibly fun.
One, in my opinion. There are so many complex moving Parts here before this. We just launched an announcement about upcoming huge changes in the economy. The community sentiment towards these changes started to shift, just within the last couple of weeks from Community leaders. Stepping up and saying that the economy needs tough medicine right now and the public opinion around, basically decreasing, rewards and adventure mode and daily quests. Basically just went from Maybe.
30% more like 60 or 70 percent are now in favor of these changes. So it's fascinating stuff. It's a lot of fun. It's also very stressful. But I never thought that I would be in a position to be working and thinking on something like that.
So they're incredible role. I feel you literally are jpowel the president, the Secretary of the Treasury and there's a lot of pressure and rolling out a decision. That's going to have impact. When you make a change. What do you look to understand? If it was successful?
I think about the FED, raising rates. They're trying their best to manage something, and you make a change, but you don't know all the ramifications, it will have in the economy. You're managing. What do you look to as a measure of success?
We can look at growth levels. We can look at things like the meant to burn ratio Community sentiment. We look at Marketplace volume where the kpi is how many axi owners there are ownership of the different tokens in the ecosystem population growth rate GP game, domestic product. This is now a
thing.
What do you think about the inflation or deflation of the currencies? I feel like that gets a lot of air time. People stare, at a coin Rises comes down. SLP is in a deflationary cycle. Does that matter to you or is that too short term thinking and that's the Traders. Just looking for the easiest thing to
measure things like somewhere between that we have to be in touch with economic conditions on the ground of the economy. But we also have the longest term incentives if that makes sense. They're going to be a lot of people. In the economy. They might be
More like mercenaries, especially during a bull market. Well, markets are annoying in some cases because you have all these people who come in and then the market turns and suddenly they become a huge headache for you. Exponential growth bull markets. These are double-edged swords. But the idea though is that you're ultimately left with more missionaries. There's a cycle to
everything. Just on this point of changing the Dynamics. I think of you're playing a game right now. It's you have this Pokemon Style game.
You're battling your axes and there are people who are where we started it living their lives or generating income off of this and you change the rules. How do you think about changing the Dynamics for the players? That might be thinking? Okay. This is how the games working and now suddenly I came back and it was changed on me.
There are different types of people who want to focus on different layers of decentralization. What we focus on is our players have ownership of the game. Our players can help us build the game. We have these aligned incentives.
In terms of do we ban assets? Do we change the game over time? These are hard things that we've discussed with our community members. Different people have different points of view. But this is a opt-in system. You don't like a change that happens in World of Warcraft. You have to deal with it or you can quit playing. But in this system at least okay, you can quit and you can sell all your assets and get the least some of your money back and move on to a system that is more aligned with your principles and ideals. So the Tricky Tricky,
But we have to think about it. In terms of product maximalists almost rather than dogmatic web three idealists.
What you're doing is extremely challenging and as the biggest, there's a lot of pressure that everyone expects it to be perfect. And when people feel flaws in that, they forget that you're still in Alpha mode and testing a lot of the stuff out. One thing you had mentioned. I'm curious just to dive in a little bit deeper. You talked about the incentives of the team being long-term. How does the structure of the Game Reward you and the
team with XE Sky million Stones around 20%
Of the access token to access tokens. Represent a piece of the game. You can use them to govern what the community treasury. I think there's around 1.2 billion dollars in the community treasury govern. What that is used for. We own 20% Community owns 80%,
This is my taxi my ticket to all Sky Mavis products or is there a world where Sky Mavis has multiple Nations? And universes they've created
the idea is that each team of axes is a ticket to all.
Teacher axi experiences whether they're built by Sky Mavis or where they're built by the community. So we tell the community, if you build something with oxy and that's the universe. You should let people use their own apps. You, how do we create a nonzero monetary value for an in-game character, that has an uncapped Supply. You make sure that the population growth of those characters is relatively under control and based on demand and you make sure that the
Utility of those characters is constantly increasing over time. You can have more fun with them. Perhaps, you can earn ownership and different products from them. Each axi also allows you to create the future, axes each axis, like a digital pet store. If you have two axes, I can breed together your digital pet owner.
So I think as you evolve the game and you think about changes you're making, it would be really fun to just touch on the future developments the builders program metaverse, all these new things that you're going to be able to do with
Same axes,
in terms of battling activities, were going through our third aeration of that. In the beginning, you could use them in these automated battles and the FDA Arena. And then now there's the current battle system, those gold buyer on six people right now. We have the upgraded battle system. Actually, Community origin going to be much more. Beautiful faster-paced skill-based importantly, also free to tries. Anyone will be able to get started. Go down the rabbit hole without actually having to spend anything. We also are working on.
Okay. Land, collect resources, fight for control of territory. Build up a town city form alliances something more similar to like a Clash of Clans with a little bit of stardew Valley the harvesting then also the Territorial and a combat. Those are the two main threads of gaming experiences that we're focused on the sky. Maybe has we see room for an entire universe of minigames and having third-party Studios coming in to build on top of the XD IP having the community come up with on.
Actively amazing stuff is similar to a Roblox model Dave from roblox actually invested in the series B. We have very aligned Visions. If we achieve our goal of hitting hundreds of millions of players. Plus, we're never going to be able to produce content fast enough for that number of people. So this is why it's, like, no game has ever scaled to billions of people. Why? Because game development and has not been hyper scale will before, but now, maybe it can be
I feel like the word play to earn became loaded. I know you guys now, call it play and earn and I just love to get your take on the general landscape. What that means to you and why play to earn is so different than play. And er,
there have been a lot of really fun games before. There. Haven't been a lot of games where you can come in and start earning money. That's always been a little bit more of an exclusive experience. The media definitely loved that narrative and definitely pushed it. But ultimately,
He's economy's, not be sustainable. Unless people are spending in, then for reasons that they spend in traditional economies. Why do people spend money in real life? You spend money for convenience, for status and the pursuit of love for Community XE, has some of that amount of spending. We need to increase it over time. The more we can increase that then the more sustainable than economy. We're going to have in terms of nation-building lingo so far. We've been a growth dependent, foreign investment dependent.
Emerging Market Nation, that's okay. That's how most countries start up, but long term, we need to focus and we need to transition into a export-driven consumer spending fueled economy. So what does that look like? In terms of being a game, people are spending for fun for status for convenience? And then also outside brands are saying, we would love to come in and increase our brand Equity by getting our message out to your community. Those are non Financial return driven.
Sources of capital into the ecosystem plate. Iron it makes it harder to build towards that future because you're going to be attracting people that are only coming to play the game to make money. Based on that messaging,
looking at through the lens of a Frontier Country and Emerging Market in creating a game that this spectacular, not everything goes well, and not everything goes as a plant. I think right now would be a good time to talk about the end game tokens and their extreme rise. And then fall, the SLP was at I think three.
Once and it went to 30 sentence back closed for two or three cents a excess went up to $160. It's down to $50. I guess my question to you is, how do you think about it as a game developer? Having to act also like a central bank, to control the currency and how the different reaction between speculators and game. Participants.
It's really interesting working on this type of crypto, powered or web three, powered game. It is in many ways, a new type of game, but in other ways like a lot of these problems,
These are things that have also been faced by game designers and game Economist in the past the role of a game Economist if it's not necessarily new, so any given economy whether it's blockchain enabled or not. There has to be this balance between the way that in-game resources or in our case tokens are emitted and basically how they're used in game Design, This is called a sink and the things they derive, their power from gamers.
He's spending their hard-earned resources tokens to collect things to get to progress to get closer to their goals. Right? So there has to be from game design perspective. There has to be enough. Intrinsic motivation for playing the game to make friends to have fun to show off and flex. These are the things. These are the emotions.
And Loops that drives sustainability of a game economy. So balancing the Indian economy. It was it's much easier at a smaller scale because things aren't moving as fast. And for three years, we had pretty balanced economy. It was then okay, like, hyper growth came in, right? You have millions of people, the amount of tokens that are being generated each day and sold, right. It kind of went exponential so that definitely created a lot of really interesting problems, but the reassuring thing in my
Union. Is that game, economy Design? This is a field that's around, 25 years old and a lot of these learnings can be applied reapplied to F3 gaming. So for example, in order to write increase demand for the in-game resources, whether that's access or SLP, for example, we can introduce body part of creates. Those body parts could be. Some of them could be certainly, very rare and look really cool, and allow you to progress in.
The game and then because people want to progress, they just need these body. Parts are then willing to spend their in-game resources. The fundamental issue is that there has to be this balance between great, the people that are spending within the game and those that are looking to earn some extra income. Right? This isn't a magical world where everyone can put in $5 and take out 10. This is the core difference, right? Is that in a traditional game when game is our
Being a hundred percent of that goes to the game developer. Whereas our model is different where we're sharing a majority of that spend with the players that are actually within the universe.
It's interesting that people have been thinking about game economies to your point for 25 years. I think something that can be lost in the discussion, is that when you introduce tokens, you have this new actor, which is in-game economies, have been thought of but speculating from the outside people who have never played this game are able
To play with the currency, they're able to speculate on going up or down. And how do you think of a game designer of trying to, really from The View homeless, the Central Bank, when the market gets too hot being like, oh, this might not even be the players. This is just outside Market forces. And how do you think about intervening in that way of the, maybe the Speculator versus the player?
There's definitely, especially with in crypto. There is the rise of a Speculator attending class that can come in and in some ways route.
They Conyers ecosystem and some ways actually really help your ecosystem by providing liquidity and things like that. So, it is definitely a tough to balance. I think all we can do from our end is to really make sure that right. We're building an awesome game that has sufficient reason to basically give utility to the in-game resources and The Tokens The speculators, you know, they'll come and go, it kind of in the short run. I guess. Cause some imbalance in the game economy.
Me but yeah, I think what we have to do is really focus on the missionaries that people who are playing that fun or have a really super long term vision and understand what this movement is about. That said, right. There are things that we can do, like, cut the emission, which is something that we actually did recently. We saw that the amount of SLP that was being emitted, through the game, was way. Higher was like 230 million. SLP was being created each day and only
Million was being used each day for reading. What we did is we actually took out the daily quests removed Adventure Mode missions. And then we got it down to erase, I think around, 89 or 90 million SLP their daily. So there are levers that we can control but just like we also have to build towards the long term as well. So we're simultaneously like the central bank or also Builders of the universe and we can use the levers but we also I think like
Part of it is just like creating an amazing universe that people want and community, that people want to be a part
of it. We've talked about it before that. You've just been extremely transparent. Especially I think, most importantly a good leader transparent when things aren't going well. Can you give us an example of, you know, how you've tried to tell the community, how you're feeling about something are changes that you might have wanted to make, but just for whatever reason, you have a very large company, a lot of different stakeholders, kind of how hard it is to go from. Yes. I understand the problem, but I'm the implementation of that solution.
As you get larger and kind of get buttoned up a little bit more, you have more process process is good, right? And make sure that you don't make any like these mistakes and then everything's nice and Polished at the beginning of implementing process. Sometimes before everyone is used to, it can also extend and make you a little bit less agile, right? So, you want to be in this Middle Ground, where that you have enough process, so that people can come in and understand what's happening and all your releases and Communications with the community are really good. But then you also want to maintain a
What got you here, which is, at startup mindset, and being super dimples so that, you know, that's something that we're grappling with right now. I think we're making a lot of progress. One example raised that the meant to burn, was pretty out of whack and was really apparent. Even as early as like, November December. And we started basically talking to the community and saying, hey like that a whack with which we do and started having internal discussions as well. And then, you know, there was, there was an actual implementation of that until an
The February. So in an ideal world would be like, okay, we can identify the problem very quickly kind of rules something else. So I think all we can do is look at what in that process from detection of the problem to the rollout of the solution, you know, we're there any times in that process that dragged on for too long and a short and basically, that kind of production line,
but you talked about that developing in the stable, trying to grow to become, more of a developing nations or really interesting framework to think about access.
So Ronan is your side chain and the way I think, I understand, but correct me if I'm wrong. This really is very much like etherium, but you've tweaked. It. It seems that when aetherium gets upgrades to security, somehow Ronan benefits from it. So explain to me how Ronan works and how it's different than something like a polygon. An L2
Ronan is an annotation scaling solution built for type of scaling, these NFC games which are beginning to take on characteristics of
Of distinct digital neutrinos Ronan is in a theorem for. So it's evm compatible to be honest, is scaling Solutions are becoming a commodity. There are a lot of them. So, in terms of the tech, the tech is becoming commoditized, the running Bridge. It's number three. It's one of the top bridges on ethereum, in terms of total value locked, even though it's only serving one game. What's special about run Ronan has 4 million people on it or million people have downloaded the Ronin wallet. It has the
The community living on it. So if you're a lefty gaming developer, you actually want to succeed. What do you do? You're gonna go to the platform that has the users that has access to users. That's the idea behind Ronan. Is we built for four years and saw what was out there. It was nothing that really made sense for us as product, Focus people. So we built it. It's worked out. It's worked for us and we believe that will work for the next generation of really, ambitious Builders.
Are there other game developers on Ronan today, and if not, when do you
You seek the next independent or sister nation building on a ronin.
We haven't made any announcements yet. It's a place where people are super excited to potentially build and we want to open it up more over time where it's much easier to start building on running. Right now. We have to invite you which is in my opinion against the ethos, not great, but it's also there are a lot of things that could go wrong. If we took a super open approach, really early. Hope to have some strong Partners building on.
And by the end of the first half of this year, so that's what we're thinking.
That's exciting. I'm excited to see what you do there. She has been super fun. I like to end podcast with the same question and you have a lot here. So I'm excited for both parts of this. But what are you most excited to see built over the next six months? And what are you most excited to see built over the next six years?
We are fully focused on the launch of vaccine Community origin. For the first time, you're going to be able to play this amazing, beautiful fun.
Nft game without having to make any economic decision. People will be able to see, hey, like, these games are actually fun. These games are actually just as fun, if not more fun than traditional games. And I played a lot of creature collecting mobile games over the last couple of years. They're not as fun as a community origin. In my opinion. We're super excited about that. And we think it's going to introduce taxi IP to an entire New Generation over the next 10 years. I'm super excited to see this entire ecosystem.
Of digital Nations. Sister Nations start to pop up on Ronan where you have the axi digital Nation. Then you have something that's peripheral. It might share some currency, right? There might be a reserve currency and maybe that's wrong. And yet you just have different types of gaming experiences with different people. All happening on this hyper scalable chain for digital Nations.
Well, gee, I really appreciate meeting with part of the government structure of this emerging nation, and I look forward to staying in touch.
You and watching how this thing grows
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