How NFTs Will Build The Communities We Want
It's not about the art
Let’s get back to it with a short Sunday post!
Recently my friends at the House of Beautiful Business and I were discussing the potential of how to create stronger communities using NFTs and DAOs. Given it’s been a hot topic, I thought I’d lay out how I might think of creating a small community, why NFTs, the long term benefit, and why it’s such a compelling proposition.
For context, my first real online community was around the year 2000, when I first encountered Joshua Davis who set up Dreamless, which eventually led to me joining o8, an online community of digital designers from around the world.
The digital community was a home on the internet where a limited number of designers could share ideas, help each other, and also talk about nothing at all. The community would host meet-ups in different cities, where individuals from around the world would fly to connect, bridging the online and the physical world.
It was also crafted around an invite-only or “in the know” community of those connected with the creative industry. This meant its members were often usually more engaged and connected. They wanted to be there and wanted to be connected.
Of course at the time, this community was accessed with a user name and password, and was simply a loose association of people who enjoyed talking about design.
But what if it could have been more?
20+ years later, these types of small communities are flourishing within gaming, small-streamers, content creators, or around various areas of interest. Especially during the lockdown, internet communities are currently continuing to grow and find new ways of building connections. These communities, while having moderators and leaders, are often somewhat self-managed, where the community themselves controls the content guidelines and keeps others inline with their behaviour or comments. They are also proving to be quite powerful - as The End of Power predicted.
So why are NFTs, often associated with art, so interesting, specifically in terms of communities?
NFTs as a piece of digital art and a way to create ownership is interesting. However NFTs as a key that unlocks access to a private community is so much more interesting.
I have yet to understand why more bands or companies aren’t looking into this - perhaps it’s simply too early(?). It’s not only a way to generate value for those in charge, but bring value to all of the NFT holders in the community, and build more true fans.
I can imagine a future where every local small company provides NFTs or is set up as a DAO, a Decentralised Autonomous Organisation. Essentially a modern day co-op in US terms - read more from this great post from Packy.
The amazing thing is individuals and communities can create what they want as they go. Here are a few examples in thinking how NFTs can build communities. In no way even close to exhaustive, but rather a simple introduction.
✳️ Set a price for the initial buy-in: If the community wants to be built around investment, meet-ups, creation of merchandise, or anything requiring money, then this can be done on setting up an initial buy-in when the NFT is purchased / minted to collect money from all the members. This allows for a central pool of money to use for whatever the community decides.
✳️ Determine community rules: Currently a lot of programs are cash-grabs at best, and fraud at worst. There is no long-term concept or unifying concept, and usually the community leaders are vague around how they would spend any money the community raised. For those setting up true communities, think of how you want the community to operate to help bring people together. Here are four (4) simple examples for setting rules around communities to ensure consistent value.
That members must do a certain amount of consistent engagement, or they can be removed.
The sale of NFTs is only allowed if the community agrees on it.
Always ensure when NFTs are sold, they are sold at a higher price. If a community member can’t sell their NFT/token for a higher price, then they aren’t allowed to sell it. This ensures the community works actively on making themselves valuable and ensures that the value is always increasing over time.
With each sale, a portion / percent could go back to the community originators, ensuring an ongoing stream of additional revenue as members turn over. New members get access to a community or club that is consistently strengthened, and the community and leaders are consistently paid back for that.
✳️ NFT only meet-ups or unique community events: This is what Veecon does and I love it. Through doing this type of online community, there is an opportunity to do meet-ups that can only be accessed by community members. You can imagine all sorts of value for members based on what the community sees as valuable.
If it’s a band, then select meet-and-greet or private shows.
If it’s an author, then early publication of new books and AMA session.
If it’s a content creator, collaboration in their videos or content.
For a leaderless community it would be about merchandise or investing on in-person retreats, or buying items for the larger group.
If communities want to expand, they can vote to issue new NFT tokens, while the original tokens could be seen as those who were “originals”. Once again, this is always about making the token and community valuable in the long term.
✳️ Be Unique: I love when people try new ideas to explore what is possible - like images that disappear from the internet over time. Or like this NFT which has to be passed or burn to access it’s value (thanks to Guus for always sharing these with me). We have a chance to build and explore the future and yet most NFTs we’re seeing tend to already look all the same. I think we can do better!
Honestly I say more NFTs should be ugly - it’s not about the art!
✳️ Collaborations - Of course for those interested in the art side, there could also be potential for collaborating with artists to make unique art that act as the token.
Personally selecting a forward looking artist, like Sougwen Chung, would be interesting as opposed to the typical NFT bust shots of cartoon animals we’ve been flooded with and bereft of imagination or passion.
I know that was far from exhaustive, and there is so much more that could be said. Perhaps we’ll explore this more once we bring back Let’s Fix Things.
For now it’s a start on this rainy Sunday and I simply wanted to offer a slightly formed view of why NFTs are worth taking time to understand and invest time in. Especially as more people are aiming to become their own boss - how they create community and value may start to mean a lot.
Looking past the flood of fraud we have now, and there is a lot, the technology holds amazing promise to build better futures, create new jobs, and create better communities for anyone willing to invest and think long term.
We just need to work on the productisation and user experiences now - at least I know I still have a job in my future 🤣
Lastly, as a general wrap-up, here are some of my “go-to” links for articles, and other link libraries to read all about Web3.
Getting an understanding of protocols versus business - This is good to separate the technology from the hype.
Potable identity in Web3 (a16z)
The next big thing looks like a toy (Chris Dixon)
The Constitution DAO story
The set-up and a breakdown of how the entire system came together to quickly.
The build up and excitement working towards buying the constitution
The fall out, including the failure of refunds, gas cost issues, and voting struggles.
The Axie story - Blockchain / NFT game in SE Asia
Understanding Axie and it’s promise -
Why Axie is struggling and fiat currency is still the “go to” (and did it really need to built on using blockchain technology?)
The Metaverse landscape. Not specifically related, but good to capture it as emerging technologies.
Some of the best Not Boring posts on Web3, NFTs, and DAO’s
That’s all for this week. Thank you for reading and exploring topics with me!
Until next time!