Immersion • 1

Seizing the Exponential Age

Feb 11

Welcome to Immersion — your gateway to the new Exponential Age. Written with love for the multiverse creators, AR/VR architects, blockchain developers, crypto investors and web3 visionaries of the world.

Time is opportunity, so let's dive in.

Web3 x Metaverse.

[•] Here is a great profile of Gather, whose low-res online universe (a cross-breed of Zoom x Pokemon, centered around fully customizable spaces) is taking over the digital world by storm. The simplicity and beauty of the product, as well as its ease-of-use, are all a major part of its growing success, especially among students, gaming communities and blockchain developers. What I love about Gather is that they are building a fun, friendly and 8-Bit version of the metaverse that requires (1) a low-effort to participate, (2) can be seamlessly integrated in your daily work or community channels and (3) brings back a sense of comforting nostalgia (and nostalgic comfort) from an earlier digital era that is almost forgotten today. Many interesting use cases can be observed so far.

Metaverse x NFTs.

[•] The effortless creation of 3D assets and the easy replication of real-life objects into their respective 3D digital twins will become key enablers to the growth of the metaverse, especially where it intersects with gaming and NFTs. Whoever nails this problem area could potentially become a key infrastructure gate for anyone playing games using 3D NFT assets. One of my favorite startups building towards that end is Kaedim, an early-stage venture whose newly-launched platform automatically transforms your 2D art, sketches and photos into 3D. The company has developed a straightforward product with a sleek interface that is positioned towards enterprise clients.

But, while artists in small studios could potentially have a need for such a solution, game designers in larger video-game companies tend to have their own custom tools and processes they follow. Importantly, it is the in-game participants of the new gaming multiverses who will benefit the most from the ability to easily construct 3D digital assets. They also represent a giant, ever-increasing market (thanks Gen Z digital native content creators and gamers!). Building functionality that will allow them to turn their easy-to-create 3D objects into NFTs will be critical in capturing this massive opportunity. Given how crowded the space is getting, I suspect that either Kaedim or some other startup will manage to do this soon.

Gaming x NFTs.

[•] Gaming and NFTs. NFTs and gaming. Is this really an oxymoron? A lot of ink has been spilled to try to interpret the growing chasm between NFT enthusiasts and hardcore gamers (which, curiously, does not extend to music fans). At the risk of angering many of my gamer friends, I personally believe that game-enabling NFTs will have a transformative effect on the overall gaming landscape, particularly through Play-AND-Earn (PAE) gameplays, rather than the common Play-TO-Earn (P2E) models that became so popular in 2021. With PAE, players do not have to make a choice between what they want to play and what they have to play. Gamers are focused on playing games that they love, while developers are focused on creating beautiful gaming worlds and immersive experiences that can become ‘sticky’ (rather than focusing too much on mechanisms of economic incentives). I think this path will help soothe many in the gaming world as well.

New Web3 platforms like Strider have started enabling game creators to take more control over their projects through DAOs, perhaps gradually bridging the gap between the crypto ecosystem and the game world. Gaming giant Zynga is planning to launch an NFT-based game this year, while legendary video game company Nintendo has some interesting thoughts about the Metaverse.

Blockchain x Community.

[•] Dune Analytics has announced a Grants Program for its Wizards ($10,000 for a 3 month residency), while Polygon is looking for Mages to run their Guilds. As Vitalik reminded us with his recent article, the kids that once spent countless of hours playing WoW, Lineage and Dota are now setting in motion the new era of digital economic reality, borrowing heavily from the terminology of their favourite adolescent video-games. There are many good reasons as to why these games were so successful back in their day — some still are! — and drawing inspiration from them is no mere accident: they were fun, enthralling, imaginative and empowering, letting players escape into a crafted fiction from their daily problems and their busy, often dull lives. Blockchain communities today are taking the best elements of these immersive experiences and turning their purpose upside down, now making them part of real-life economic and social activities (on-chain or in DAOs).

This is why I keep a close eye on Dune. Their recently-claimed unicorn status is nowhere near the full potential of its platform. Much like the Bloomberg Terminal helped ‘unlock’ immense value for the modern financial world since its creation, so will Dune's Dashboards become the go-to tool for anyone observing, analyzing, building or investing in the era of web3, blockchain and open finance. The time when expertise in “Dunealytics” will become a common requirement in job postings and every VC, PE and mutual fund will have a "resident Wizard” in-house is not that far away.

Crypto x Regulation.

[•] UK's HMRC has come out with new guidance on the treatment of DeFi loans (in particular, for staking and lending). You can find an interesting take here by Konstantinos Adamos (Legal Counsel @ Revolut) on the update . More guidance is in the works, which shows how seriously top UK tax authorities are looking at the space.

[•] In a remarkable 180-turn, Russia now plans to license exchanges and tax large transactions, rather than ban cryptocurrencies. The plan has the support of the central bank, which previously wanted to outlaw mining and trading. Fresh draft regulations are expected in the coming weeks, which could force the hand of other big countries.

[•] We are still awaiting for the Executive Order prepared by the Biden administration on crypto, which is expected to outline the U.S. government's strategy regarding the space as well as start setting many wheels in motion in Washington D.C. No wonder crypto lobbying expenditure in the U.S. doubled last year, top American VCs like A16Z have been engaging heavily with lawmakers in D.C. and leading enterprise crypto companies like Coinbase have started forming SPACs.

Media Watch Post.

Bloomberg ran a segment on the future of DAOs and wrote about the appeal of crypto paychecks outside the US. NYT ran a positive (!) crypto piece on Helium and its potential positive use cases, talked about the massive gains for those betting early in successful altcoins (!!) and then posed the question of whether web3 is a giant scam. CNN wrote an article about the crypto marketing blitz in this year's Super Bowl. BuzzFeed wrote about the NFT accounts of the most (in)famous couple in crypto. FT explored the crypto-mining boom in Siberia. Business Insider looked at the growing number of folks leaving Silicon Valley giants for crypto and web3 startups. Politico wrote about how Diem is gone but not forgotten. Reuters reported that Celebs pushing crypto face increased regulatory scrutiny.

Hidden Gems.

⏩ Cypher Accelerator @ UPenn. The newly opened crypto accelerator at Wharton's Stevens Center for Innovation in Finance has just announced its 1st cohort.

🏅 MIT Bitcoin Expo 2022 Hackathon. MIT's annual BTC Expo has opened its Hackathon doors welcoming hackers, developers and designers from around the globe.

🏅 Pear Web3 Competition 2022. $100K in cash to launch your startup. Deadline was yesterday (Feb10), but I'm sure they might do exceptions or be interested in new ideas.

3️⃣ Opera's new Web3 initiative. The Opera Crypto Browser Project aims to provide users and industry with a new, dedicated Web3 browser.

👨🏻‍💻 Has Facebook (Meta) peaked? Boston University brought its experts together to answer just that, following the company's difficult last few weeks.

🌌 Mixed Reality and Political Discourse. Dane Lund explores the integration of metaverse and government via the lens of Neom's endeavor to build a digital twin.

🖼️ How will the Fed impact the NFTs market? Sfermion Research attempts to answer this question at length. TL;DR: Probably yes, but TBD. Kudos to Andrew Steinwold.

🖼️ NFT Museum opens up in the United States. A museum dedicated to NFTs has opened its doors in Seattle. You can find its official website here.

📕 US Treasury Dept study on illicit finance in the high-value art market. Why is this relevant? There is a lengthy section on NFTs and NFT marketplaces.

📕 PWC's Global Crypto M&A Report 2022. One of the major takeaways from PWC's annual crypto fundraising report is that crypto M&A increased almost 5,000% in 2021.

🦾 A Quantitative Analysis of DeFi Option Vault Strategies. A super wonky, super finance-y and super luminous research piece on DeFi options by Sam Chepal.

Top Finds.

★ [NFTs] (1) Creaticles; (2) Storyverse; ; (3) Skyweaver; (4) fiveoutofnine

★ [Blockchain] Blockscan Chat

★ [Web3] (1) Slates; (2) eth. Leaderboard;

★ [Metaverse] (1) Ready-Player Me; (2) Inspirit

★ [DAOs] (1) LinksDAO; (2) Proved; (3) Rug Radio

★ [Culture] The Fabricant

How did you like the inaugural Immersion? Do you have any themes, stories or projects that you would like to be featured in follow-up issues? Let me know your thoughts on twitter.

Immersion