can this jpeg have sex with this jpeg and create a new baby jpeg? Say what?” When CryptoPunks started in 2017, they seemed silly to many. They were only 128px by 128px. Who cares? They weren’t really cool until Gary Vee had a mastermind call with influencers and said, “Become crypto punks be huge, get some of them.” They went in and cornered the market and jacked up the prices.
Bored Apes was around the same time Gary started his project. They brought big influencers together and said, “Let’s get these.” And so they all bought, the prices went up over time. These cost 2 Ether (ETH) at once. That was a lot back then! Now the bottom is like 80 ETH. All of these NFTs — CryptoKitties, CryptoPunks, and Bored Apes — were making big bucks.
Related: Which NFT collection was the most profitable?
When I chatted with Gary in early 2021 as he was thinking about NFTs, we talked about launching Wax, a blockchain specifically for NFTs. It’s like WalMart but for NFTs. NFTs are much cheaper on Wax than on Ethereum. Gary would continue to do a great job raising $90 million alone to bring her to ETH. I just don’t like those gas fees that much at ETH – it’s a big liability.
I was beginning to see the implications of what could be with NFTs. Many people view NFTs as mere images; they are just jpegs, no different than a screenshot. NFTs have so much more to offer because they can really unlock experiences for you. NFTs represent the next level of digital rights management. Essentially, your NFT can be video, images, text, audio, links, AR, VR, 360 video, and a combination of all of these. You can unlock specific venues based on geographic proximity, etc.
An NFT can also evolve over time. You can have a little baby NFT, maybe a little baby egg, which then turns into a baby dinosaur. He then turns into a toddler dinosaur, an adult dinosaur, and he can mate with other dinosaurs and get a baby dinosaur. The cycle starts all over again. The stronger and more powerful the dinosaur or a certain lineage of dinosaurs, the more valuable. Believe it or not, there are many real-world uses for it.
There are also more utilities for NFTs. If you have that NFT in your wallet and can prove it’s yours, you might be able to go backstage at a concert. There are many loyalty rewards that can be made with these NFTs. If a band comes to your town, they can throw something in your wallet, giving you an extra experience.
Related: We haven’t even started to unlock the potential of NFTs yet
An NFT is basically a programmable smart contract that can do anything you can imagine. It’s not just a JPEG – it’s proof of ownership that an item is yours. NFTs have not yet scratched the surface.
If you have an NFT, you are now part of the community of people who have those specific NFTs. You can go onto the blockchain and see everyone who is in this community with you – your other NFT holders. You could then drop something on them as well. These communities are best organized as DAOs.
A DAO is a decentralized, autonomous organization that has no employees, no boss, no headquarters (physical location), and no place you can call and speak to anyone to complain. Sorry Karen, it’s a DAO.
Code manages a DAO. Let’s say there are three DAO members. Each of us has the right to vote and participate in the DAO because we hold these NFT. We can participate in the leadership of that particular organization. Not every DAO needs an NFT. Likewise, not every DAO requires a crypto token. Either way, if you have X tokens, you can have a certain level of voting rights. Alternatively, if you have a specific NFT or number of NFTs, you may also have voting rights. It’s a foolproof method of voting to govern an organization the likes of which the world has never seen before.
Related: The DAO is an important concept for 2022 and will revolutionize many industries
These types of organizations are not just made up of three people. You will have thousands. If you have a specific NFT within such an organization, you will have more voting rights that correlate to your NFT holdings (either a specific NFT level or the number of NFTs you hold). DAOs work very differently from traditional organizational hierarchies, which have a bottom-up employee, manager, director, VP, president, CEO, and maybe a chair. None of this exists in a DAO.
A DAO is an organization governed by code rather than leaders. That’s a paradigm shift considering it’s algorithms and smart contracts that are replacing these traditional corporate structures. They perform themselves in many ways; if that happens, then this.
Smart contracts should be automated and enforce certain rules. For example, smart contracts can come in handy when you’re a freelancer trying to finish work for a client. What if the smart contract generates itself after the work is done, executes it and you get paid immediately? How awesome does that compare to having to wait 30 days for January in accounting to finally get to you more than 30 days later?
The currently largest platform for NFTs and DAOs is Ethereum. It was, after all, the very first smart contract platform to be built. You can run code based on what you write in the contract; if this, then that. It eliminates many problems that are particularly common in the digital realm. It eliminates the need for trust and intermediaries. Most businesses will want some sort of smart contracts to run in their organization.
There is no cheating with a DAO as it resides on the blockchain and is programmed into the code. We know who has which NFTs or tokens and the vote that corresponds to. It’s undeniable, it’s trustworthy. It is the way of the future for voting in organizations.
A driverless car is like a DAO. It’s autonomous, it drives around the city on its own. You can tell it to go to a certain place. It will follow directions and monitor the road to keep you safe – all managed by code. As long as you are clear in your code it will do what you suggested. The DAO brings a community component to NFT projects. You can collaborate and contribute to the project.
When creating a DAO, make sure you have the right legal governance framework in place. AndreessenHorowitz has a DAO legal framework you can learn from. Be sure to check that out.
Related: Decentralization, DAOs and the current Web3 concerns
Timetables are important. The utilities for your NFTs are important. If you’re in the process of creating an NFT series and the art looks cool, few people will care. A roadmap shows people that you have the necessary long-term plan for your project. Roadmaps show that you care about a project, that you have long-term goals for the project, and that ultimately it is not a money grab. Many of these NFT projects are quick bucks. People see other people making millions of dollars from NFTs and they want a piece of it and then they’re out. This is not good for the community.
A roadmap defines where you will take the project quarter by quarter. In Q1 we do this. In Q2 we do. And guess what? You won’t believe what we’re doing in 2023. Having an idea of where you are going shows your community that you mean business and it is not a scam. Sometimes very legitimate looking projects have garnered large audiences, sold out, and never delivered. They just took the money and ran away. This is a carpet train and they are awful. The big NFT projects in 2022 will have roadmaps.
In the future, projects will not only have a roadmap, but will also be useful beyond the artwork. We are already seeing NFTs with better capabilities than the first generations. For example, the concept of how NFTs fit into the metaverse has caught on. You will be more than a profile picture, which many NFT projects have been.
Related: Increased adoption of Metaverse NFTs will fuel the next NFT growth cycle
Notice to Investors
If you are an investor, only invest in NFT projects where the team is known and has doxxed themselves. You can go to each team member’s social media profile and see that they are public and active—especially the executives and lead developers. But also the marketing team etc. A lot of current NFT projects are hiding behind avatars and fake names and I think that will change.
Whether you’re starting an NFT or investing, you don’t need to know about every NFT out there – take a deep breath. Many may not be relevant to you and your business model. Still, there’s that element of loyalty and ownership that might appeal to many listeners, and you don’t want to miss out on this potentially valuable opportunity.
This article does not contain any investment advice or recommendation. Every investment and trading move involves risk and readers should do their own research when making a decision.
The views, thoughts, and opinions expressed herein are solely those of the author and do not necessarily reflect or represent the views and opinions of Cointelegraph.
Travis Wright is a top marketing technologist, author, keynote speaker, blockchain consultant, tech journalist, and growth hacker. He is the former global digital and social strategist at Symantec for the Norton brand. Wright is the author of Digital Sense: The common sense approach to effectively merging social business strategy, marketing technology and customer experience. With Joel Comm, Wright hosts two of Apple’s Top 100 Business and Technology Podcasts, The bad crypto podcast and The chic show. Wright sits on Wax’s Advisory Board.
https://cointelegraph.com/news/nfts-daos-and-the-importance-of-roadmaps NFTs, DAOs and the importance of roadmaps