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Notes on Consumer Crypto | Feb 16, 2024

Boost, Unlonely, maincharacters.app, Starknet, Sora, and more.

I was running around New York all week and my god it was nice meeting up with a bunch of the consumer crypto homies in person. Feeling very fortunate to get to play around on the internet alongside such amazing people.

Here's what I found interesting this week...

Boost

We kicked off the show this week with Brian, founder of RabbitHole which has now evolved into Boost. We’ve been obsessed with the emerging onchain media distribution ecosystem (Interface, Daylight, etc) unlocked by protocol rewards, and Boost is building the native incentivization layer for it. 

Anyone can go onto Boost, specify an onchain action they want people to perform, and provide a reward (usually in the form of tokens or NFTs) to people that complete it. You could want to do this to get people to try your product, collect your NFT, bridge to your L2, etc.

We talked to Brian about the multi-year building journey he’s been on to get here, how to run successful incentivized transaction campaigns, why they’re launching an L2, and a bunch more. You can watch the ~20 min convo here.

Cooper also wrote a good piece this week about how he’s been using Boosts that I recommend reading.

Love on Leverage

I talked about Love on Leverage a few weeks ago when we had Brian on the show, and Unlonely ran the 5 episodes of it this week. As a reminder, it’s a dating show where the audience controls the length of the dates by trading their $VIBES token.

The shows this week averaged around $100k in transaction volume from people speculating on the outcomes and wanting to dictate them. Assuming they take a 5% fee on that they’re making $5k per episode, and doing it on a very small audience right now (a couple hundred viewers). They’ve tapped into a fundamentally new streaming business model.

In fact, I think transaction fees (grouping in protocol rewards to this) is the killer business model of consumer crypto. Whether that’s through facilitating memecoin trading, onchain media collecting, prediction market participation, payments etc. 

If you’re able to create a meaningful context that users want to transact within there are countless revenue opportunities. And the revenue per user web3 projects are seeing is dramatically larger than we see in web2. Stepn/Axie/Sorare all make over $100 / MAU / year where Strava/Calm/Duolingo all make under $10 / MAU / year. Obviously the latter are operating at a way larger scale, but it highlights the opportunity here.

Love on Leverage is also just another great example of directly serving the emerging crypto culture. The types of people that are here are very down for a dating show with embedded memecoin mechanics. 

Maincharacters.app

Someone I know but will remain nameless launched a cool experiment this week called Maincharacters

The core concept of the product is dropping memecoins for main crypto characters, with $GENSLER and $ELON as the first two, and there are a few things that are unique about it.

First, the tokens are 1155s so buying 50 $GENSLER comes with 50 generative gensler images of varying rarities. You can easily save the rare ones and sell the common ones back into the bonding curve if you wish to re-roll. This was built pre ERC404s, but could be a great example use case of them.

Second, it’s one of the first cohesive, end-to-end facilitated, memecoin experiences I’ve seen. The buying/selling, the charts, the chat, the transaction feed, and your P&L are all displayed in context in a single interface. This is clearly an improvement on the tg bot, dexscreener, tg chat stack that most use, and opens up a wide design space for more experiments.

Sniper issues on launches and high fees have hampered the activity a bit, which they’re working on fixing, but it’s worth clicking around to get your imagination running.

Starknet Airdrop

Starknet, a zk-powered Ethereum L2, revealed their airdrop this week and it was a bit of a disaster. They biased heavily towards developers, and users who had been providing a bunch of liquidity and trading volumes got nothing to very little. People also realized the token was actually launched 2 years ago and 13% of the supply unlocks in 2 months for the team and early investors.

Farmers obviously reacted negatively to all of this and instead of being understanding the founder fought back. The general CT sentiment right now appears to be to send it to zero with haste.

Not only is this a waste of an important marketing and user acquisition event for the L2, but it shows such a clear misunderstanding of what matters here. The L2 wars are a branding battle, not a technical battle, and acting like this is a great way to destroy your brand.

Sora

OpenAI teased their new text-to-video model yesterday and sent twitter into a frenzy. The quality of the outputs look truly insane, and comparisons to outputs from last year’s models really put in perspective the speed they’re improving at. It only created 60s videos right now, but give it another year and anyone will be able to make high-quality feature-length films with a single prompt.

This tweet by 113 is always where my head immediately goes when things like this drop. What matters in the world of infinite content and infinite software that we’re quickly approaching?

As I see it, more and more value will flow to brand (and community) and they’ll be empowered (leveraging AI and crypto protocols) to start serving consumers in more expansive ways. They’ll be our entry points into content and software worlds, and our way of filtering and making sense of information. 

Aspirational and identity-defining brands will be our banks, movie studios, art galleries, fashion labels, social networks, software providers, etc all rolled up into one. They’ll capture the attention and hearts of a type of person and serve them in every possible way.

TG Trading Bots

Delphi dropped a great report this week on the state of Telegram trading bots. They’re widely used cashflow monsters so are worth having a solid understanding of. They’re also commoditized products so comparing their relative success with their go to markets, token models, and fee structures provides interesting case studies.

I won’t go into too much detail and recommend reading it, but one thing I did find funny is that the report clearly prefers the more fundamentals based projects of Unibot and BananaBot compared to the meme-driven BonkBot.

They think BONK is in an “awkward middle ground”. I take the complete other side of this and think Unibot and Banana are in the less desirable position of being valued based on pure fundamentals and not having a thriving memecoin community to leverage for network value and distribution. BonkBot trading at 30 P/E to 6 and 4 for Unibot and BananaGun is a feature in my mind, not a bug.

Regardless, it’ll be interesting to watch how the market unfolds. Are telegram bots just an intermediary step to better mobile trading interfaces or are they here to stay? 

Finding Love Onchain

I was grabbing coffee with 0xDesigner this week and he brought up Nikita Bier’s tweet that highlights how people download apps for 3 core reasons; making money, entertainment, finding love. Crypto clearly has proven potential for powering products that make people money and provide entertainment, but we still haven’t proven that it can also be a powerful tool to build the softer social experiences that people will use to find love.

I also had a conversation with Jacob where he asked me what I’d focus on if I was running Zora. And I think my answers to both are the same.

We need products that make the onchain media we’ve created and collected to matter socially. We need to want to follow and slide into the DMs of people based on their collecting taste. We need our collections to have organic attention and be things people want to explore. 

Instagram gave legibility to our photos and made them a medium for identity building and socializing. It made people take way more photos and care about others photos way more. What will be the product that sends onchain media down the same path?

YC RFS

YC dropped their Request for Startups this week and it was fun to step out of the crypto world for a minute and see what the rest of the tech world is excited by. They listed a bunch of machine learning and AI applications, space and climate tech, spatial computing, a way to end cancer, and a bunch of less interesting stuff. 

The two things that stood out to me going through this was how little interest they have in consumer, and how little interest they have in crypto. Everything was b2b, and the only mention of crypto was within a stablecoin finance category. 

I get it, they’ve built a web2 b2b unicorn factory, but not one consumer category? And payments is the most exciting thing in crypto? Come on. They don’t see what’s happening here.

Have a great weekend loves

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