Simon de la Rouviere’s contributions to crypto range from seeding the idea of bonding curves and curation markets, to now working on bottom-up storytelling with Untitled Frontier.
Here is my conversation with Simon de la Rouviere.
Simon’s exploration of creative mechanism design through the years is documented on his blog. His contributions to the space range from seeding the idea of bonding curves and curation markets, to building one of the first creator platforms with Ujo, to writing a full length novel experimenting with different publishing models, to now working on bottom-up storytelling with Untitled Frontier.
In this conversation, we talked about cc0, designing NFT economies to welcome derivative works, bottom-up storytelling, and much more.
Sina [00:00:18]: Hey everyone, welcome to another episode of Into the Bytecode. Today, I sat down for a conversation with Simon de la Rouviere. Simon’s been around crypto for a long, long time, and he’s one of the original and creative thinkers in this space who I deeply admire.
In this conversation, we started by talking about storytelling and how he thinks about this notion of bottom-up storytelling. We talked about SCP which is an interesting subculture on the internet. We talked about Jenkins, the valet, CC0, and how NFT economies can be designed to welcome derivative works. And we talked about how more experiments could be run using bonding curves and Harberger taxes, and how NFTs are designed from the bottom up. I really enjoyed this conversation. And with that, I’ll leave you to it.
Sina [00:01:10]: With Untitled Frontier, you’re kind of exploring the medium of building a shared universe. I think the way you framed it was bottom-up versus top-down storytelling and playing with that spectrum.
Simon [00:01:27]: Yeah. Why I got into storytelling at all recently was I realized that everything that I’ve been doing, it’s like, I enjoy being creative. So it’s like, you know, I’ve made music, I’ve done writing. Coding is creative. I enjoy being on stage. Like I enjoy creativity in all its formats but I realized even doing a startup, right, doing startup is a creative work. So to me, it’s like through all these threads of everything that I enjoy in terms of creativity, I realized you’re essentially doing storytelling at the end of the day. It’s like when you’re on stage, you have to tell a story. When you’re building a startup, you have to through marketing, tell a story about why this matters.
If you’re writing music, you tell a story about what the listener is supposed to feel. And if you’re writing a blog post about something, there has to be a story. Like why are people reading this article? You know, so it’s like throughout this, all of it’s like storytelling. And I realized, well, maybe I’m just actually a storyteller first and foremost. And I need to hone that craft in different ways. And so getting into fiction storytelling was just a way to continue that exploration in new different ways and seeing how all these threads are put together.
Like after I left Consensys, I was a Consensys for four years; from 2015 to 2019. I took the opportunity to write my first novel and it was just extremely joyful experience because I found that the process was actually very similar in terms of how I was creating in terms of like crypto-economics and token economics, which is essentially have to sit with this idea in your head the entire time and push it and mold it into different directions and see if it works or not.
Sina [00:03:09]: How is that happening for you on a day-to-day basis? Because I can imagine that writing a novel, it can also be a very painful experience for some people.
Simon [00:03:21]: Yeah, but I enjoy that process. I enjoy the process of feeling lost in the story. And so for me, it’s a process of exploration in itself. It’s like, you’re not just exploring the world that you’re creating, but you’re exploring possible universe’s paths and permutations constantly. And that felt like a similar kind of process to thinking about crypto economics. You have to go, but what if someone does this, right?
It’s like whenever there’s a malicious actor doing this. And so in storytelling and writing this novel, it was constantly going, well, why didn’t the character just choose to do this, or like one of the character decides to do this. Oh, now that they’ve done this, it means that character’s motivation is going to change. Like they’re going to want to do something else based on this behavior.
And you also want to ensure the characters at the agency, you know, just following a plot. So you constantly have to be all the people. That’s a good, just a very joyful experience to me because it’s this constant process of exploration and pulling from different futures and trying to make sure that there’s some narrative that makes sense in a logical process.
So on a day to day, that was probably it, but I’ve also learned a lot from writing a novel and how I would do it again in the future. I feel there’s this dichotomy that’s used in writing, which is called plotters versus pantsers. And plotters to find the plot beforehand, and then they fill in details.
Pantsers are people that the call of writing from the seat of the pants, which is just like, they wing it, right. They start writing and the characters seem to have a life of their own and they--
Sina [00:04:53]: You’re on a ladder. I imagine.
Simon [00:04:54]: Bit of both. Like I would go like, this is where it should be headed, and I know there’s key plot points that’s coming up that I think it’s going to matter. Let me just see what the characters are doing along the way, and then I change it. But I feel like the reason why that’s a bit more difficult to do is just it takes longer. Right. So you have to be willing to go back and redraft. Right? Constantly.
So, there would be something that you say three quarters to the book, some characters, it just felt right at the characters would do this, but to go like, well, the only reason why it feels great in here is that you have to actually set this up way earlier in the book, which means you have to go rewrite some stuff. And now you go, okay, well now I’m rewriting this stuff which means these characters might change their motivations based on the things they have here.
So you have to do, like, I call it a defragmentation. You really need to defrag hard drives. It’s like the constant we shuffling process. It’s like, okay, go back dah, dah, dah, dah. It’s like sorting algorithm. Okay, go back dah, dah, dah, dah, fixed it. And so then the process takes very, very long if you do it that way. I mean, it took-- I was a first-time writer and I do it full-time and it took about year and a half year to eight months or so to write full-time to get it published, book.
Sina [00:06:07]: Wow! Yeah. It’s very interesting just hearing you describe that because like, I guess when you’re building a product or a startup, there is a similar process in which like, as you’re kind of building it and you’re moving forward on this timeline, you have new ideas and your whole sense of like what this thing is, how it should be formulated, it’s kind of like evolving. But you have this like helpful constraints, which is you can’t go back and change history. Like your degrees of freedom are only like from here going forward. Whereas when you’re like writing a story, you can literally be like, okay, I gotta go back and like redo this whole thing, which I imagine, especially if you’re drawn to, you know, I mean elegance or like things, the puzzle pieces fitting perfectly together.
I imagine it can really like hook into that sense of like being a perfectionist and like really just kind of like have an infinite feedback loop**[crosstalk 00:07:04]**.
Simon [00:07:05]: But that’s dangerous. That’s what people don’t finish your stuff. You know, they get hung up on the fact that it has to be perfect, and I try actively to avoid that it’s just, when it feels to be 80% done, I go like publish it.
Sina [00:07:18]: You gotta ship it. You gotta have some of that shipping mentality
Simon [00:07:20]: You gotta get started. But the process of creating was almost very different to what I was used to before coming from tech, it’s like, it’s acceptable to go, Hey, I have a new idea. It takes a weekend to code or like a two, three weeks to code and you publish and see what people think or feel. And then it’s like this very nice feedback loop of like, okay, people are using it, or this sucks, this is good and we try and improve.
Writing a story and it takes a year and a half, it’s kind of sucks to give people a draft, you know, to go into this. Because again, it takes a lot of time, right? It’s not like, oh, you can look at a website for 10 minutes and someone can give you a feedback note. So you’re putting a massive amount of expectation on somebody to go, Hey friend, read this thing. It takes six hours, seven hours to read, and it’s a draft.
Sina [00:08:04]: So it becomes a very like lonely solo experience. I imagine.
Simon [00:08:08]: Yes, it can be. And I mean, it’s obviously stuff I thought about coming from a tech space. Like how do you improve feedback along the way? And whether that actually matters. Right? I’m not even sure it matters because it’s a different thing when you’re creating a product for people to use versus something that you feel you’re a creator and you have a story to tell.
It feels like it should be more the case that when people create for absorbing a story, whether it’s music or art or storytelling, you should stand on your own two feet and be confident about what you’re doing, and then let other people just interpret that, whether it’s good or bad.
Obviously, there’s ways along the way, which you can improve it. I’ve been reading creativity Inc. from one of the Pixar founders and how they used to fix stories along the way during production. And they have this thing called the brain trust, which is just like a group of people that they trust to give opinions without ego. Right.
And it’s like, that would be great to have access to that while you’re writing a book or a novel that takes a year and a half. But at the end of the day, that’s just someone that’s a good storyteller and that might not even be the case. A good storytellers are the people that want to appreciate what you’re doing. You know, it might be that you’re writing something that’s completely different, that doesn’t fit the narrative or normal way of storytelling.
There’s different ways of storytelling: the 3-Act structure, there’s Kishotenketsu, is the Chinese-Japanese style narrative storytelling.
Sina [00:09:33]: How does that one work? How does the-
Simon [00:09:35]: Kishotenketsu?
Sina [00:09:37]: Yeah.
Simon [00:09:38]: Yeah. That’s interesting. Yeah. Strangely enough, one of the most popular posts, my blog is Kishotenketsu article because they’re just super like SEO juice for some reason. Like everyone that Googles Kishotenketsu somehow finds my blog post about it, but it’s an interesting way to do storytelling, which is in, we started from-- I might be wrong in remembering this correctly, so apologies if I don’t get this correct. But as far as I remember, it was started as a form of Chinese poetry, and then got adopted in the rest of Asia.
So the formula is quite interesting. It’s a four-act structure of storytelling, which, it’s often used an example, but people say it’s not the conflict-based storytelling. So a lot of Western-based storytelling is conflict narrative. It’s hero journey that overcomes the internal-external problems and superhero movies and everything’s conflict narrative. Like we have to overcome the Euro and all this kind of stuff. Kishotenketsu is usually used an example for conflict-less storytelling. How it works is the four-act structure, which is there’s an introduction, so just like sets the scene, and there’s some interesting development, something changes.
The third act is usually unrelated to the first two parts. It’s just kind of strange, something completely different. And then the fourth act is sort of what they call the [unintelligible 00:10:56] sedation. Why the first two acts and the third act is actually relevant to each other. So why it’s interesting as to form storytelling it’s you read it because you want to be surprised. So the final thing is always, oh, that’s why the third act is here and it shows how it relates to the first and the second act.
So obviously it’s quite different to traditional Western traditional structure because it’s like the third act is supposed to confuse you, so you want to read it because the third act is going to confuse you. And then the fourth act will go, here is why these puzzle pieces -
**Sina [00:11:31]: --**it will resolve it all? Is there a popular example of a story or a saying that uses this structure?
Simon [00:11:39]: So obviously it’s used often in poetry. So usually for shorter narratives. Longer-term, I need to read actually longer form Kishotenketsu, but the classic one is by poet San'yō Rai, and it goes, the introduction is Daughters of Itoya, in the Honmachi of Osaka. So just like a - these daughters, these Royal daughters. And then the developments next, it says, the elder daughter is 16 and the younger is 14, so you know now more about these daughters.
And now comes the third act which is completely unrelated. It says throughout history, the generals killed the enemy with bows and arrows. Well, why does this matter? Why are you saying this? And then the conclusion, not the twist and why these puzzle pieces matter is like the daughters of Itoya kill with their eyes. You know, so it’s like, okay, it’s an interesting sort of introduction development change, and then it’s reconciliation at the end.
And so it’d be interesting to see this on a longer-form storytelling. And I also think one of the examples in the blog post is [inaudible 00:12:48] I also use it. You can actually do 3-Act structures with Kishotenketsu as well. You know, you start with Act 1, there’s a character conflict. Act 2 is rising of detention, and Act 3 is the resolution and the climax. So just this constant growth narrative of the stakes must keep getting higher.
And so I wrote like an example of like a 3-act structure with English and Kishotenketsu which is just a story about a puppy and a boy, which is like the first act is a puppy lives with his family, is young, and likes to know and things. And then the development is one day, the dog ravages a corner of a couch and some papers. And I realize, okay, the dog really likes to chew stuff and whatever.
And now the third act is like, what’s going on? The boy is stuck in his room, is crying, so obviously you want to ask him what’s going on. Why is the boy crying? Why’s what’s related to the dog story.
And then the final reconciliation is the father opens the door and apologizes for grounding the boy. The dog left the paper trail and did indeed eat the boy’s homework. So I understand, oh, the boys crying because the dad berated the boy, but actually, the dog did eat the boy’s homework. So, but there is this three-act structure, which is this conflict between the boy, and the boy and the father. It just revealed in a different structure than linear and start middle end. Yeah.
Sina [00:14:07]: I love that. One question that comes to mind for me is on this theme of top-down versus bottom-up storytelling. Right. And if I was to describe the spectrum, top-downn is there’s an individual, or like a group as centralized group who has a particular, you know, is like carrying this torch. The way you were while you were writing the story, you were like going through it beginning to end. And bottom up is maybe there is a seed planted, and then everyone’s kind of left to their own devices to kind of expand on different story arcs and like compliment each other and like run into like different circles. And there isn’t a kind of centralized cohering force, like pulling it all together.
So where have you seen this bottom-up storytelling be effective? And I also see parallels to this. This is like one of the open questions in my mind when we talk about DAO’s for example, right. You know, some people conceive of DAOs as like there is no-- I mean, again, it’s on a spectrum and all versions of this exists to different extents, but there’s a version of a DAO where there’s like no leader, and it’s just a thousand community members who are contributing a little bit where the project aligns with their interests and availability, and all their life circumstances.
And then, on the other end of the spectrum, it’s maybe a project does have a lead, like maybe does have a benevolent dictator who’s like carrying the torch, but they’re just kind of enlightened and how they’re operating. They’re not trying to like keep all the control for themselves, but in a very kind of more intentional way, they like give responsibility to different people, bring them in and this like opens up over time.
So in thinking through this, a part of me feels that the kind of most radical, interesting, potential things that crypto can give birth to are on this like extreme end of like the bottom of spectrum. Right? And the projects I get super excited about like Loot like Yearn how it was started. It’s like even Ethereum to some extent. A part of me yearns for that to be the future that we’re building.
Simon [00:16:40]: Yeah. It’s interesting. The way I see bottom-up storytelling is before we could write stuff down, stories were constantly reinterpreted, you know, folktales, indigenous stories. It’s all stories that are open to remixing being really polled. It’s the story of the Bard, in the end, singing songs about something. They didn’t own the song, it was, there was constant re-interpretation and remixing happening.
So the story existed as sort of spread through the memory of the network, be it the people and the wherever the story is. There wasn’t an owner of the story.
And today, online, we do have bottom-up storytelling it’s memes, right? So like people create memes and no one knows actually who created 10 original meme or where it started. Sometimes you do, but rarely, sometimes, or you don’t even care. Right. You don’t care that this person who created the original meme or some forth like that. So it’s just consequently active storytelling that people have through expressing themselves through Gibson pictures, and modifications and formulas and templates and so forth, so it does. It does happen more, so part of my exploration like you’re right with using blockchains is the sort of question of how can we facilitate that. But also then in through this process either cultivating new relationships, but also bring value to people that contribute through the sort of messy, organic process. Since that it’s more than just a social process or a social ritual that people do.
And I think the key thing there to make it work on that extreme is to sort of define new structures of relationships. And in this case, it can be new ways of ownership, but it can be something else too that we don’t know yet. Right? So, you know, when you look at Bitcoin or Ethereum, I think there are doubts, right? Because is it a decentralized? Yes. There is no one power structure here. It’s fairly autonomous. It runs by itself and yes, it’s kind of an organization because we do have a shared goal hereby maintaining this ledger for sharing social relationships.
So in doing this more explicitly as a- besides just play for meme creation, storytelling, like being a kid in the backyard and pretending a branch is a stick. Like to formalize this process is what I’ve been interested in and trying to figure out. And in that article, I wrote more about it.
And I think the key thing here is just, again, when I also mentioned earlier, an interest around platforms and protocols is to define like hey, here are some rules and we can use to create together and bond defining some specific rules, it allows people to explore more. So I can give an example; Before the blockchain, it still exists today, but it’s like a project that doesn’t use the blockchain is SCP, which stands for--
Sina [00:19:32]: I came across this.
Simon [00:19:33]: Yeah, it’s wonderful. It’s Secure Content Protect. It’s a collaborative, creative writing exercise where the goal is for people in the real world to find these strange anomalies in the real world and then write fiction about them. Right. So, it’s not conspiratorial. It’s just like we were enjoying creating
Sina [00:19:50]: Though coming across it, I was like, this must-have like found its niche amongst like the conspiracy theorist over the last couple of years.
Simon [00:19:57]: Yeah, yeah, maybe there’s some metadata narrative you’re going, but it’s creative fiction. Right? So there’s this weird picture that someone took and we’re creating some imaginary world around this picture. And the goal of secure content protectors to log all these anomalies, because we have to secure reality. We have to contain and protect ourselves from these anomalies. But one thing about why it works is with the advent of the Wiki, right? So the entire thing is structured like Wiki pages.
So you write a Wiki page about your anomaly and that structure is important because that allows people to think in that form. It’s like, oh, you see something weird, this must have a Wiki page, right, about this anomaly. So with NFTs, it’s like, there are options here to create formats and rules for people to go, Hey, in this format, we can create new kinds of bottom-up based storytelling that allows people to be imaginative, that allows people to earn from their contributions and gives it an up structure so that it’s not just Lucy falls apart along the way. You have to have necessary structure to guide people in a certain way.
And Loot like you said, is for me as a very good example because it purposes what I would say lower fidelity. So it invites people to imagine, right? So it’s like, here’s just a bunch of texts describing an adventure’s lootpack, now you go and vent, what are whatever the supposed to mean? That to me is very exciting because you cannot take that. And through the composability of blockchain, as a platform, entities as a platform, you can expand upon that and potentially earn through your contributions along the way. So, yeah, it’s that tension remains interesting. I think the only reason why we are saying the last hundred years, ish 100-200 years, maybe with the advent of like, you know, protectable IP and all these kinds of things. We have seen more tendency for top-down stories to be the things that succeed. And, you know, is the reason, this is the answer. Right? You can see that like it works.
Sina [00:21:59]: I also feel like designing a system that allows for bottom-up storytelling or bottom-up building invites a different kind of an attitude from the builder of that project. Like as the “founder or the builder”, you need to have a much more flexible relationship with what you’re putting out into the world.
And I feel like it really does benefit from thinking of these things that you’re putting out as like projects, rather than like companies like this is a project that’s going to like develop in any number of directions. It doesn’t need to be anything. And I’m like really designing it to give autonomy to this like other group of people to like take it in whichever direction is going to happen. And whereas the company is like, no, I have this like vision of like what this is going to become in 10 years’ time.
And this is something that actually Zack from Coordinape that has really stuck with me, which is, he said, companies are a deliberate process, deliberate outcome, whereas DAOs are deliberate process, emergent outcome.
Simon [00:23:21]: Yeah. But you’re absolutely right. Even like the form of the company, you know, again, like I said before, you have form and structure that usually lends itself to certain kinds of behavior.
And this is actually something I’ve been personally struggling with my business with Entendre Frontier is that I’m trying to get out of the idea that it should be a tech startup. Right? Because that’s the only, because I’m used to tech startups, right. The company is a vessel at the end of the day that is supposed to enable something in the real world. You know? So now yes, there is legal stuff, tax accounting, things based in the US**[crosstalk 00:23:56]**.
Sina [00:23:56]: Right which inevitably kind of like anchors you into a form, but yeah.
Simon [00:24:01]: Yes. But then sometimes people serve the form rather than using the form for a goal in the real world. So, you know, it’s like you are constrained by the form itself, in order to think. But this is also coming back to the classic. The more I figured out, the more I see that Marshall McLuhan was so correct when he said the medium is the message. It’s like at the end of the day, the medium defines what kind of stories you can tell. Even in business, like the fact that you have a company sort of means that you’re thinking about things in a certain way, even though it’s not sometimes intentional.
So if you say you start with a DAO, you’re already training a way of thinking versus you’re starting a company, and even starting companies in different countries. Like starting a company in Europe, starting company in the US company in the South Africa, you’re already starting off from a different starting point of what this supposed to enable and trying to get out of that frame of thinking to go like, this is not supposed to be a tech startup. You know, this is just supposed to serve me in doing what I want to do, you know.
Sina [00:25:00]: Totally.
Simon [00:25:02]: And maybe it’s not the right way at the end of the day.
Sina [00:25:09]: Right. Like those constraints, like just limits; the design space that you’re exploring in a very subconscious way. Like even, you know, let’s say you’re bringing together a group of people to build something. If it’s purely going to be on-chain, you can just experiment with all sorts of like crazy structures to do that. Like there could be like quadratic funding. There could be like all sorts of crazy stuff, but as soon as you’re trying to do it within the existing regulatory framework and you’re like, okay, are these contractors, do I need to give them like 1099 forms? Because, and then you’re immediately like screwed.
Simon [00:25:49]: Yeah. But that’s why I enjoy the collaboration exploration in the blockchain space because it allows you to get out of those modes of thinking. Right. Because even like the simple question, are these employers or contractors. Like if you set up a split and the sale goes through it in a split, you don’t have to give people 1099. So it’s like
Sina [00:26:05]: Right. Maybe it’s a feature, not a bug. It’s to like push the don’t be an intermediary, and that’s how you bypass.
Simon [00:26:13]: Yeah. And it just also changing your mode of thinking. I think it’s something I was struggled with critics of blockchains. I think it’s necessary for critique and stuff, but I think the difficult thing I always struggle with is like critics of blockchains is I want to ask them, like, do you not think that having a public lyncher is the most interesting thing out there? Like this is so interesting. Like we’ve never had this on a global scale, like a public venture. Right? Like how can you not think this is interesting? People say, yeah, but it’s like a slow computer. Yeah. But that’s the point.
It’s supposed to be just the shared consensus, making mechanism with a public ledger that enshrines, you know, social relationships in different objects over time. This is so interesting that- can’t you just see that? I dunno, that’s my biggest frustration. Other critique and stuff is fine. Like I share some of the worries and concerns, but that to me is just like having an imagination. Sorry, I didn’t want to denigrate people, but yeah.
Sina [00:27:20]: No, I feel the same way. Where do you find inspiration today in terms of project that are experimenting with this bottom-up emergent storytelling in an interesting way? And I saw you talk about bond, which I hadn’t come across before, which was like Jenkins, the valet. Yeah, so what are some of these threads that you think it would be worth like me and other people paying attention to?
Simon [00:27:49]: Yeah, so I think the big factor really in how blockchain-based story or storytelling using blockchains can enable new bottom-up-based storytelling is that there’s one key thing here that has changed. And it’s the ability for people that created the derivatives of works to earn from doing so with more incentives than traditionally.
So creative comments is a thing. People write fan fiction, it’s a thing. And some fan fiction writers even become successful, then hone their craft there and even fan fiction. So that incentive live works, right. It works, but it could be better because if you are a derivative creator, one, you might not have the rights to actually create the derivative. It just noncommercial maybe use. Some cases, you might not even have the rights to use names and things or characters from the original.
And then secondly, even if you’re allowed non-commercial fanfiction, that’s it. You can’t sell your derivative work. So when that creates a constraint upon the people creating derivative so they’re kind of stuck there. Either you approach the original license holders and ask for permission to publish and earn from it. And that [crosstalk].
Sina [00:29:07]: And that’s just like killing the entire long tail of experimentation.
Simon [00:29:09]: Exactly.Yes. A hundred percent. I mean there has been examples of like that, like Baosho. I think the book is called Baosho, which was basically the fourth book in the Cixin Liu trilogy, The Three Body Problem trilogy. There was a fan fiction book and that loved it so much, published it as the fourth book.
So it’s like, yeah, fan fiction works sometimes. But the way it helps in NFT storytelling is if I own the NFT and I create derivative work from this NFT, I will then earn from bringing value to the original collection. Right. And I could earn from creating derivatives works, which I’m allowed to sell with commercial rights. So the equivalent would be I’m writing Star Wars fan fiction, I can sell my Star Wars fan fiction, but if the Star Wars fanfiction is successful, it’s as if I’ve had Disney stock and it also earned from Disney becoming more successful through the fact that I wrote successful, great stories, fanfiction.
Sina [00:30:07]: Is that because you would own some of the Disney NFTs beforehand or because they would kind of close this feedback loop and have a system for kind of rewarding fanfiction creators?
Simon [00:30:20]: It’s just more simpler. Like it’s a Star Wars, had the license, had the creative commons license that allowed people to write derivatives and sell them. Anyone in the world could buy Disney stock. Right? Then those incentives would be similar to what you see in NFTs and Jenkins the Valet example where someone went, bought a Bored Ape decided I’m going to vent the story for this Bored Ape and I’m going to sell the derivative works based on the Bored Ape.
So what’s happening is if Jenkins the Valet and has a project decides this was great, we are done with this project, right? They made money from selling derivatives works. But now that I have a valuable because they imbued value into the specific area. So they brought value to the entire collection or community of boarders. By making this one board more valuable, they increase their financial returns by making that one specific board at more valuable. And they’ve earned from creating derivative works.
So it just basically means if you wish to create derivative works, there are more ways for you to earn now than previously. It doesn’t mean you have to participate at to that extent. But if you were someone that goes, I would love to create derivative works, but obviously, you know, I have a job. I can only do the weekends. I would love to write. I think there’s a lot of people that go, I’m a huge Star Wars fan, I would love to write the Star Wars story one day. You know, that would make me really happy, to give back to something that meant a lot to me growing up, but I can’t. I can if I want to write Star Wars fan fiction story, but that’s the only way for me to do that on a legitimate scale is to approach Lucasfilm and say, Hey, I am an idea for the Star Wars fan fiction story, I would like getting into those meetings.
Sina [00:32:03]: Totally. And it’s like, it’s the whole stance of these CC0 NFT communities towards derivative works is completely different, right? Like it’s, you’re welcoming people riffing off of what you’re doing. Like with Nouns, like their whole purpose is to proliferate the Noun meme. Right?
Simon [00:32:25]: Yeah. But it’s a wonderful because it’s to me, it’s like, we’re getting best of both worlds here. Right? We’re not restricting access to content anymore. It’s like to say anyone is free to enjoy this, right. Like in, with, on Tada frontier, all the stories are being published on a creative comments, so anyone can read it. I mean, I’m even producing narrative. All your drama was from it. It’s Fetterman podcasts, YouTube. You can listen to it for free. The content is free.
Sina [00:32:50]: I listened to the latest one on Spotify.
Simon [00:32:53]: Awesome. Thank you. So the content is free, but you’re still able to earn from this process, right? That’s exciting. You know, that’s, what’s new. That’s what’s exciting. So you can get the abundance of storytellers telling stories and you’re not restricting access to the enjoyment of the stories, but you’re earning elsewhere and that’s great. I really love that.
Sina [00:33:13]: Right. It’s like consumption and distribution is totally free and open, but ownership in that like original name is limited is scarce.
Simon [00:33:26]: Yeah, yeah, exactly. Yeah. But it just basically means that the, yeah, the ownership doesn’t come from the distribution of the content anymore. It’s, you’re buying something else. And that bed model. I mean, it’s not going to work for all kinds of stories. I don’t think, you know, something like Avengers or Dune is going to suddenly go, Hey, we’re going to make money only from NFTs, and all the cinema releases is free for anyone to come.
We’re paying AMC and all the theaters for anyone to just come watch, who knows maybe that experiment needs to happen with a $200 million movie and we’ll see if they make more than 200, like if they make more. You know, but this is, this is my God in the blockchain so many years ago is because I saw this as a platform to experiment with creativity.
Like I was a creative and the first thing I saw with Bitcoin was, wow, I actually, you can get paid for the stuff I’m doing. Because growing up in South Africa, I created video games during high school, and I was like, I could never sell. Right. I didn’t have access. Like I said, being, living in a US did. So for me, like seeing Bitcoin for the first time I was thinking, wow, I can code something up, give access to people to earn from selling games without having to go through this sort of difficult process of signing up for access to financial services. And so that was always a promise. Let’s do creative stuff with this stuff, let’s enable creativity.
Sina [00:34:49]: Yeah. And adjacent question, which is a thread. I know you’ve been pulling on over the years is how to design these like base layer, NFT economies. So like, so that the design kind of encourages participation and is open to new participants, while like rewarding people who are early. And you had this post, I forget from how long ago, but it was talking about a model that would combine bonding curves with Harberger. Is that how you say it?
Simon [00:35:21]: Harberger.
Sina [00:35:22]: Harberger taxes. Yeah. It’s like one of those words that I’ve only, that I’ve read a million times but I still don’t know how to say it. But it was a model that combined like Bonnie curves on Harberger taxes that would, you know, just kind of like create more pressure for like liquidity. Like less of people kind of like sitting on their NFTs forever at, and like listing them for these like insane prices.
But reading through that, at least to me, it felt like we haven’t nearly explored the design space of what can be done here. Like most NFT projects still do 10,000 and like PSPs and that’s that. So I’m curious, what are models that you think people should experiment with?
Simon [00:36:08]: Yeah, I think I agree with that extent. I think this has been the case in the past few years in the blockchain space, people copy successful models and that’s fine. Right. But at some point, it does get uninspiring. Like I don’t want to see another 10K PFP project. Right. If it’s a cool thing, sure, go for it.
But there’s a lot of uninspired stuff that just copies the model, sells 10,000 NFTs without thinking more unlike whether it’s the right model or not for that specific execution. It’s kind of similar to startup equity. You know, I’d never, I’ve always wanted to read why people say they should be this one-year cliff and then you earn for four years equity. It’s like there’s no-- I couldn’t find any literature when people decided this is the best way to incentive.
Sina [00:36:56]: Yeah. Anyway. Well, because like the design that has been used over and over again, like has kind of it’s a defensible decision to make like it, don’t see to explain it. Whereas if you’re trying to deviate, then you need to like explain your whole reasoning for it.
Simon [00:37:11]: Yeah, exactly. But so with NFT collections, I a hundred percent agree that there has been not nearly enough exploration about around exploring different property rights and economic tools to facilitate NFTs in general. So, the one example that you mentioned was bonding curves, so I experiment with Atmos new elastics, where you can generate these pieces of like neoplasticism-inspired squares.
And it has this bonding curve. So you can always sell it back into the bonding curve. And then another one I did was this artwork is always on sale, which as it says on the cover, I use, it uses a hardware contacts to require people to always post a soft price. And the NFT can always be, it can never be impossible to hold. So, you know, it’s obviously likely that in the future, a lot of NFTs will just be lost to time. People lose their keys or people die without being able to stress for these things so forth. But with this RX always on sale, it will always be possible to get this NFT over time.
Sina [00:38:16]: Yeah, it’s always up for a sale.
Simon [00:38:19]: It’s always up for sale, but yes, I generally feel like there’s not been enough exploration in terms of what people can do and. Yeah, I wish more people just generally explore with them. With Untitled Frontier, for example, we release a collection with each story in one of the collections with each story is like a, there’s like a four-week campaign and anyone could buy one, NFT and after this period is over, then that’s it right? You can buy new ones.
Sina [00:38:46]: It’s just a straight-up inflating supply during that four-week period?
Simon [00:38:50]: Yes, but the only reason why I wanted to do that, let’s go one. I wanted to create a similar experience to traditional merchandise, right? So, if you want to enjoy Star Wars, you could buy the lightsaber and the stuff is only available during the campaign of the film started with Santa’s summer thing. You release the short story. Anyone can go buy one. You don’t have to go to rush to buy one and like, oh no, this is better than a Dutch auction. And like go to difficult to get this lists like white lists or whatever, like all these kind of like [crosstalking 00:39:19].
Sina [00:39:20]: It’s insane how many projects that I would have loved to be involved with I’ve missed out on because I just like didn’t see the message on Twitter and it was open for like a two-hour period.
Simon [00:39:32]: Yeah. And so it’s just like a low price. You can buy any amount that you want. If it happens to sell 20,000, then great, and if it sells 200, that’s also fine. You know, it’s just the creating the ability for people to buy one when they want to, during that sort of campaign period. So that’s an experiment still. It’s works okay. I think it matters that we also experiment with not making NFTs that are super expensive as well.
Sina [00:39:59]: How do you think about like, if you’re building a new project from the ground up today? Whether it’s Untitled Frontier or like someone else, like a friend is working on something new and you’re thinking through how to distribute the ownership layer of this project. Right? To like lean into this model. And one of the first works in the road is, do I do this with like ERC 20 tokens or do I do this, but like this with NFTs? And they just kind of create a totally different, there are different design spaces, different affordances for the community to come together.
Simon [00:40:39]: I think NFT is still for me is more interesting, especially if it’s like distributing ownership in a project. And the reason why is that I think a part of the reason why people participate is again, coming back to the original point of bottom-up storytelling is this meme the memes around the things that we do, right? You know, people participate in Doge coin because it had a funny dog on it. Right? That’s the only thing why people, so the meme matters. Right?
So why you participate in a specific DAO is also because what it represents to you and what makes you feel, but also how it relates to the relationships you’re building with the people in this DAO. Right. So again, shared goals, working towards shared goals. The thing about NFTs are more interesting than the liquid ERC 20 token, is that an NFT also defines your individual membership in this collective.
So it is still let’s say, now this is a good example, right? Each noun in the noun’s doc can vote on a treasury. So in there in that sense, each noun is fungible, technically fungible because you have the same rights, but each noun is unique in its appearance, right? So you feel like this one represents you in this collective, even though your rights are similar to everyone else.
And that’s great because it makes you connect both makes you connect as individual towards the larger collective. So previously with all the meme-based coins and stuff, it was just, how do I show my individual contribution? And it was only through how many coins you had and maybe more, more sort of meet, “Meet Space ways” like socially and culturally-
Sina [00:42:14]: Totally. Like tying your ENS name to it and then talking on Twitter or something.
Simon [00:42:17]: Yeah, yeah, yeah. Stuff like that. But now with an NFT, you’re going like, this is who I am in this collection and collective. So, it’s more interesting to me and it’s probably easier to go from making NFT fungible through all the - Like you can tokenize NFT like fractional and bunch of other ways to make that fungible, if you need it to be fungible than the other way around. You know, what have of uni swap wanted to do? NFT is it’s probably more difficult to cover from taking the unique token and making NFTs from it. It’s doable. You can still do it. You could say let’s create NFTs and you need 200 uni to be psyched to NFT in order to create it. Boom! You’re done.
Sina [00:42:58]: Yeah. Also, NFTs also have more, it just let you create different types of membership or roles within the community. Right? In a way, wherever the token, just like a uniform.
Simon [00:43:12]: Yeah, I think that’s also something that I want to see more of over time, because a lot of the stuff that’s now successful as DAOs are probably still going to run into the problems in the future, especially around general ownership of capital. Like we know that like if an economy only existed through ownership of capital, then over time, you will get monopolies. Right?
So more time, more people won’t just buy up this thing and crowd out competition, and then they will be the ones that succeed. So, there needs to be more ways to get, I’m going to say, distribution of power over some of these systems.
And that comes from changing membership roles and giving power. It’s like, it’s the reason why democracy is usually have three chambers of Congress. You know? So in order to distribute that power, there’s already, there’s already like this discontent over the fact that a lot of VCs own, for example, large portions of Capitol over some of these protocols, you know, and that’s detrimental going forward.
Sina [00:44:13]: So, how would you do this? Like, let’s say you’re now in Noun and these Nouns are selling for, I don’t know how much, like 200 K or something. And there are people who are contributing to the project. I don’t know how they’re thinking about this. Like how do you grow the base here? Like, I guess I’ve-- There are examples of NFTs.
Like I think recently I saw Kevin Rose’s proof collective are doing PFPs now, which will have, there’ll be 10,000 of them whereas there were a thousand of the original NFTs, and so this is opening it up to a wider base. Is that like, I guess that’s one model, right? That as your project kind of succeeds, you kind of do new iterations.You kind of like issue new classes of shares. Like if we were going to like take the corporation analogy.
Simon [00:45:08]: Yes, that is one way, but my thinking is more around creating social institutions above and beyond the capital-based institutions. So, you know, create a second “union” or something related to the actual capital institution that is a separate powerful force that can ensure that only capital’s not the thing that succeeds here.
So, it could be something like, you know, there could be prominent noun-based holders that go and say, okay, we are now going to create a new nouns association, right? Global nouns association of these 10 initial nouns holders. Because we are invested in the success of this project, but any future members of this association will be voted on not by narrators, but the association itself. So in that way, then in the future, you can have someone that’s in association. And hopefully, the association remains powerful that has that maybe doesn’t own it.
Now that it’s necessary for you to make decisions for the success of nouns going into the future. So, you get different input and the power locus that isn’t just the capital itself. But that takes effort, right? And the association might be funded by the nouns DAO right. Initially, but then it, then its modus operandi is to get funding elsewhere. So, it’s just creating this structures of power, and obviously, one other way to do that as well as to experiment with time-based systems. So, you know, for example, that in the US government Supreme court justice is a lifetime appointment, but a president is voted on every four years.
So, if there are different ways in which to give people access to certain kinds of power and roles that is defined by different timelines, I think that’s also valuable way to combat any kind of power from being dominant. Not a hundred percent sure what that looks like in practice, but it could be like, Hey, like the noun style holders votes on someone that has executive privilege to do some specific stuff for five years.
Sina [00:47:22]: Yeah, like orthogonal centers of power that aren’t based on the capital base. That’s one of the vectors that’s getting conflated in a lot of project is ownership and decision-making, and I feel like they don’t need to be the same thing. Like in a company, there’s the shareholders, but then there’s like the CEO, who’s like the ultimate decision-maker and it doesn’t necessarily mean that they’re the largest shareholder of the group. And so these two things being kind of like separated from each other as independent polls, I think is interesting.
Simon [00:48:00]: You do want to ensure that the people that are decision-makers have the correct risk profiles. You don’t want like a struggle with the principal-agent problem where someone’s making decisions but they’re not bearing the same risks. But ultimately, you do want either locus of power.That isn’t just the capital. Yeah. Whatever that might look like in the future. I’m not actually sure what that will look like but did you kind of see this in some extent for some of the projects where there’s the foundation, there’s the DAO and there’s the company that started everything. Like Uniswap labs, the Uniswap DAO, and then I don’t know if there’s a foundation. But that’s kind of like three system structure. It’s like the original company corporation that’s being hired or funded by the foundation or the DAO, and then the foundation is sort of a champion of both, and the DAO is like a separate decision-making body that could the UGA labs and the going down, for example. You know, it’s like the infrastructure of power here. They’re not fooling anyone. It’s basically the same entity but over time, the goal is for that to be separate stuff that was separate powers in the ecosystem.
Sina [00:49:04]: Yeah. Have you followed the whole eight-point development? What are your thoughts on--? Because that’s another model, right? Of like an NFT base and then there’s an ERC 20 token that’s introduced later.
Simon [00:49:17]: I’m bearish on projects that decide to capitalize on their success by making a DAO that just goes, we should fund stuff, you know? And it’s like, I feel like there should be more here than just doing that as a way to get liquidity and, or like make more money, print more money from this system. You know, for me, it would’ve been better if they just went and said, Hey, all the apes holders on the different collection. You’re now have a treasury, here you go.
You know, instead of going, oh here’s, all the NFT holders, you’re not going to get a separate coin, right. That gives you access to over a treasury. It’s like, why are you adding more layers here? And I understand why because it gives the liquidity and different kinds of [crosstalk 00:50:06].
Sina [00:50:07]: Well they also just converts this potential energy into like kinetic energy in some way. Right? It’s like they just manifest money out of thin air.
Simon [00:50:17]: Yeah. But I think it’s more like I said before, I think it’s more interesting if like any kind of funding mechanism or Dom mechanism is more constrained towards specific outcomes. Instead of just going, Hey, people write proposals and we might give you money. It’s like, I don’t know if it should be more constrained towards specific stuff. And obviously, in the case of Bitcoin, it’s like, we’re going to fund stuff that makes borders more boarded. Just do more projects, same with [unintelligible 00:50:42]. Right? The funding stuff, which could last people to promptly get the now mean and like build more. They’ve done physical works, they’ve done more digital stuff. That is fine but I think there’s one thing more interesting here.
Sina [00:50:54]: Yeah. All right, man. I think, maybe let’s close here. I feel like I could talk with you for hours.
Simon [00:51:00]: Oh yeah, for sure.
Yeah. That is so much to talk about. Been a great discussion.
Sina [00:51:08]: Yeah.