Alright I'm dealing with some covid brain fog so this was a wee bit of a struggle this week. Hope it's somewhat coherent.

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

Pump dot Party

The Party team launched a new “creator tool” this week focused on bringing liquid secondary markets and preserved transaction fee capture for creators to onchain media. This one got my head spinning, and I think it’s stepping us closer to a new meta.

The way it works is all mints have a fixed price (0.00005556 ETH) and 10,000 supply. Once someone creates a collection 4,500 tokens go on sale, 4,500 are reserved for a liquidity pool, and 1,000 go to the creator. Then when the collection sells out a liquidity pool gets deployed on Uniswap and it’s off to the races. There’s then a 1% tax on transactions in perpetuity that go to the creators.

It’s not hard to guess where the motivation for this product came from. They had launched Party Rooms earlier this year which let people easily form group chats with NFT memberships sold on a bonding curve to coordinate around a shared pool of capital, and pretty quickly token presales emerged as a dominant use case of it. Someone would announce their intention to launch a new memecoin and spin up a party room, people would buy into the room which pools capital and gives them an easy place to coordinate, and then the token would get created, the funds would be used for providing liquidity, and the room participants would get airdropped some amount of the supply.

Then I imagine they speedran the DAO learning arc of realizing that the coordination is friction and people just want tokens. So they built this.

What I find most interesting is how they’re positioning the product. They’re not talking about it as a memecoin launchpad, they’re talking about it as a creator tool. And while I’m down, the context and mechanics seem to go against this being used as a creative tool.

I’m down because it makes a ton of sense. The entire onchain creator ecosystem hinges on collectors wanting to collect, and liquid secondary markets makes the collecting game way more fun. More collecting, more money for creators, more creating. This can be the creator economy we’ve always wanted if we can get it right.

I’m not sure this will be the place where that’s going to happen though in its current form. Party isn’t really a place creators go to release work, the mint limit before being released on a bonding curve creates adverse all or nothing dynamics, and these not being NFTs prevents it from feeling like a collecting experience. 

But I love it as an iteration on the memecoin launchpad. Bonding curves suck if you’re not the first one there, especially in contexts where most things go to zero, and having a flat entry point is an improvement on that. I also like the tax as a way to reward the creator and provide them with a replenishing pool of tokens they could use to distribute to contributing community members.

So anyways, this is great. Think they should lean into this as a memecoin launchpad, and would also love to see more projects with creator user bases experimenting with mechanics like this. Or maybe they just need to launch it as a standalone creator/collector positioned product.

Also wanted to call out a related product the Skill Issue team released yesterday that adds a layer to pump.fun trying to solve the attention / liquidity dispersion issue. People can deposit SOL and vote on which pump.fun token to allocate the entire pool to. Once a 25 SOL or 24 hour threshold has been reached the token with the highest number of votes from depositors gets aped. It’ll be a fun one to play around with, and recommend reading their thinking behind it.

Block Explorers

It was a big week for block explorers. Etherscan launched blockscan, a simplified and more consumer-friendly version of their flagship product, and Dora announced their $5.5M raise.

The Dora raise is old, but it got me thinking about the future of block explorers and how they’ll fit into the average consumer’s onchain experience. We’ve seen a handful of variations of them being tried, from OG Etherscan as the hardcore block explorer, Onceupon as a more consumer-friendly version, and Dora positioning as an onchain search engine.

Honestly I struggle to see a world where a general use block explorer or onchain search engine is a killer consumer product in the way the website search engine has been, especially in this world of chain abstraction that we’re probably moving towards. I think they’ll be unbundled into a bunch of more focused products that serve distinct needs.

People will use Interface to follow what their friends are doing onchain, analysts will use Nansen to surface and dig into onchain insights, devs will use Contract Reader to understand and annotate smart contracts, etc. 

And I’m still waiting to see the media publication focused on surfacing and editorializing noteworth onchain stories ala techmeme. Maybe we’ll just have to build that one..

PER.MA

I started playing around with PER.MA this week which is the first product from the guys behind the ERC6551 standard. As a refresher, the standard turns any NFT into an onchain agent, meaning it can hold other tokens, interact with smart contracts, and perform transactions independently.

When they released it last year people were excited about its potential applications in gaming (ex. characters as NFTs managing their own wallet of items), DeFi (bundle of assets being used as a single source of collateral), etc but we haven’t seen much adoption of it since.

PER.MA seems like it’ll be a fun use case of it though. They describe it as a “photo exchange network which is a platform inspired by the 1960-70s Fluxus movement where mail, correspondence, and image art was exchanged through a network of artists using the postal system, except for us we are replacing the postal system with the blockchain.” Really their core goal behind it is to bridge the analog film photography world with the world of digital ownership. 

For now it’s just a camera app. When you sign up you get a starter roll of film (a 6551) with set filters, exposures, ISO, etc, and the photos you take are all minted as NFTs contained within the account of the roll. Each photo you take also gets sent to 3 other random people, and 1 goes to the “international memory bank” which is a collectively owned archive of all photos on the network.

It’s a simple starting point but they’re a bunch of photography and culture nerds so there’s a bunch of deep thinking behind it and big plans behind it. As we enter the age of infinite generated images with AI, a more restrictive and human-captured photo network may be the respite we need. I recommend checking it out.

They’re officially going live in a few weeks at FWB Fest, but if you want to take it for a spin today you can sign up with the code YOLO.

Apps Kingmaking Infra

I feel like I’m nonstop talking about how applications are going to have all the leverage going forward, and will both be the ultimate kingmakers of infrastructure as well as have all the opportunity to vertically integrate and consume it where it makes economic sense to do so. I saw a few fresh data points this week that highlight the opportunity. 

The first one was looking at DEX volume on Solana before and after pump.fun blew up. Pre-pump Orca was the dominant DEX, having 76% market share at peak. But Pump.fun decided to use Raydium as the DEX they deploy liquidity to once a meme graduates from the bonding curve, and it’s had growing market share ever since, now sitting at over 60%. This is both from the direct impact of them depositing liquidity there, but also the retail and developer attention that they drove to it.

The other one was news of Forgotten Runes, a popular onchain game, moving to Ronin. Ronin is the blockchain that was built by the Axie Infinity team to solve the scaling / gas cost issues they were experiencing being on mainnet back in the day. The usage they had has allowed them to aggregate the attention and liquidity of millions of crypto-comfortable gamers that other projects desperately want to tap into.

Better get used to this story.

Hot Start Problem

Mason wrote an article this week outlining what he calls “The Hot Start Problem”. The premise is that while tokens have proven to be wildly effective at overcoming the cold start problem, they also introduce a new problem where projects have a shortened time window to use this generated inorganic activity to find organic traction and PMF. If they don’t the incentives run out and the project becomes stale which is hard to recover from.

He thinks this is still the right path in cases where there’s a ton of competition and proven demand (blur vs opensea), and cases where you need meaningful liquidity immediately for the product to be useful (L1s, DeFi).

I like the framing. Choose the cold start problem where it’s hard to get usage and attention, or the hot start problem where it’s hard to know what usage is organic and will stay around once the incentives stop.

I’ll choose the hot start problem every time, especially for consumer products. We’re all battling indifference and irrelevance and you should do whatever you can to overcome that.

I think there’s a bunch you can do to limit the downsides of it as well. Don’t use hyped up points programs, don’t play low float / high fdv games, treat them as a core extension of the social and experiential layer of your product, sit on top of meme space / outline an adventure that people actually care about, and maintain a bunch of optionality to adjust how they’re being distributed as the project evolves.

Thanks for reading, I appreciate you ❤️