Roham Gharegozlou I The Future of Consumer is Crypto I Dapper Labs I Pragma San Francisco 2024

[Music] and what I want to do next is bring on our third speaker and that is roham RAM is the CEO of dapper laps you may know them from projects like cryptokitties and NBA topshot and we're going to talk about what the future of consumer looks like and how crypto fits into the game so without further Ado please give r a big round of [Applause] applause hey everybody in a lot of ways I think um you could think of my talk as the opposite of the talk that just happened because I'm about to convince you guys that you can think way bigger than just crypto natives but I actually agree with a lot of the same principles crypto native experience Crypton native benefits and um and and going to the place where the community lives um but I'm going to try to convince you that there's a big world out there I think I'm uniquely qualified or at least I have a unique perspective on talking about consumer and the role of crypto because I and some of the folks in this room have spent most of the last 10 years trying to build at this intersection um we played around with Bitcoin back in 2014 that didn't really go go anywhere but we got really serious with ethereum in 2017 um the author of ERC 721 the Shirley is in the back of the this room here uh you'll be hearing from him uh tomorrow uh so I won't dig into that but we've built almost a dozen web 3 products over the last six years and I want to talk to you about about how we're doing with some of them and the lessons we learned along the way but where I think the industry is going and why I'm so excited to continue building in this space for the next 10 years um we created the first smart contract wallet um on ethereum for consumers the first wallet that I paid for gas on behalf of Consumers Credit Cards key recovery Etc um we built the first game on top of EC 721 but also brought some of the largest sort of licensed IPS to the blockchain with NBA NFL and Disney um and here we are seven years later and we're relaunching crypto kitties at another uh eth Global conference the first one launched at eth waterl back in um back in uh 2017 so we'll talk a little bit about that but first even I haven't drunk the Kool-Aid enough to think that most people in the room outside of this room would agree with this statement I think most people outside of this room would disagree with this statement that the future of consumer uh is crypto I think people would agree that the future of consumer is Creator driven people might agree the future of consumer is driven by IPS future consumer certainly involves generative AI the future consumer involves spending more and more time more and more of our money in games and digital worlds um and the future of consumer might be an involved mixed reality but the reason I get really excited about the work we do here every day is everyone would agree with this statement that life is going to be increasingly digital and when you talk to these same people that kind of talk about nfts as dead or talk about crypto as only being for speculative use cases you talk about well what do creators need in the next 10 years how do they want to how can they own their own communities how can they monetize and manage them in new ways what problems does generative AI introduce in terms of authenticity provenance and when the cost of creation is reduced to zero how do you capitalize on top of that when you talk about gaming in digital worlds we're spending hundreds of billions of dollars on these digital assets uh but gamers are starting to think about well what happens when the game changes what happens when my asset goes away so the other uh alternative topic or or title I had for this talk was nfts are dead long live nfts because our thesis is that the future of consumer is crypto but on the in the background providing those crypto native benefits but in language that the consumers understand and in benefits that they value not in terms of talking about the technology and we think we've built some of that um throughout the past six years I want to talk you through it a couple months ago I went to the biggest Disney conference the bigest Disney fan conference and this was truly incredible experience because you had 80,000 people from uh across the Disney fan base these are sort of super fans they're people that travel to Anaheim to come to meet with lenses like us people providing Disney branded products and services and so it's really cool because you get to actually sit down and talk with your super fans um the people that actually believe enough in a given product to stand in line the whole day just to get access to a promotional item and for me it was an instructive experience because I spent the first few days people would get up to this uh Booth you know they would see the the advertisements the videos would look pretty cool and it would kind of be disappoint appointed some of them would be disappointed when they realize it's digital say oh it's digital what what is that why is it a digital pin what what do we want to do with it and by the end of that weekend those same people were showing me um their full completed sets on their Disney Pinnacle apps they had traded with folks on Discord because there's no uh Marketplace in the app still um and and they didn't think of the product as hey a way to make money because again there's no Financial element they thought of it as a way to do the thing they love doing which is collecting pins in the physical world our booth was right across from the physical uh pins Booth which was the biggest in the whole conference um but in a way that gave them speed they could do it in instantly they could rip had as many packs as they wanted to gave them convenience they could trade back when they were at the hotel they had full transparency um and and it started to feel pretty cool by the end of it even though in the beginning they were sort of taking back and and these are the terms that we try to talk about when we talk to our users um and and and avoid talking about any aspect of the technology the other thing I want to touch on that we're jumping into uh an adaper and what I think opens up an incredible amount of opportunity for the folks in this room is what's happening today on Telegram and telegram isn't special because of how many users they have although in crypto that's a was incredible number telegram special is because it's a social application going through its phase of allowing open developer access into its user base and so whether it's through invite systems whether it's to incentivization access to the wallet and it's a little more flexible outside of the US this phase only happens for a short period of time in every social networks journey and crypto for the first time kind of has a native distribution platform today you don't have to build on the ton Network to launch on telegram um and in fact you'll see that we've built a cross-chain application that involves ethereum flow um as well as the telegram user base so we saw a huge amount of interest and and and sort of momentum from consumers principally outside of the US and Canada um on Telegram and it kind of reminded us of early days of Facebook where you had very simple things going incredibly viral incredibly quickly through you know questionable mechanics sometimes um but opened up an Avenue of like hey this kind of product needs to exist and so how can we lean in to do something really special with it and so we bringing back crypto kitties but in a not in the way you think we're bringing back crypto kitties in a way that's cross-chain and also cross application we want to rethink the the meaning of a web 3 product not in the sense of hey we want to over serve the crypto native audience but we want to bring that value of openness composability and have different uh products interacting with the same digital assets opening up the Avenue for third parties to be able to build things for these same digital assets and also take into account the fact that just 2 million kitties that live on ethereum today um and then uh and and of course this telegram game is the first entry way into doing that so we're onboarding tens of thousands of of users today it's sort of very um quiet launch so far um but it's very exciting and it's and it's a product that you don't have to think about crypto but you're earning um what might become tokens in the future and it's a Gateway into what does it mean to have a wallet what does it mean to have uh currency to spend on what kinds of things can you spend on and unlike an app store where you go use an application and you buy assets and they stay inside the game they stay inside the the the app here we're trying to give people assets and those assets lead them into different applications different worlds so very excited about that so the other thing I want to talk about is what maybe all of you know us um uh about which is sports you know a lot of you in this room probably know Dapper laabs through NBA topshot through NFL all day and in a lot of ways these are still our biggest products and I deeply believe Sports will be the vehicle that'll onboard hundreds of millions of more people into crypto whether through digital collecting whether through gaming g gambling uh sports betting the amount of energy and momentum in what's happening in the digital world around Sports is is absolutely incredible and so if any of you are working on sports betting applications we also want to want to talk to you um but we are we've we've been lucky to have a deep partner in both the NBA and and the Fel this is the NBA commissioner Adam Silver on stage with me talking about his vision for MBA top shot and talking about how you know despite any sort of Market momentum or shift in Market momentum they're deeply committed to seeing um this this uh new category kind of Bloom and in particular that it's not just about collecting yes it's true people have collected things since the dawn of time people have collected digital ass people have collected physical assets around Sports since the dawn of sports um and they've tried to collect digital assets um since the beginning and and an NBA topshot um is the first way they've really been able to do that at scale um but it goes beyond collecting and and and these digital assets because they're open because they're transparent because they live on a network that the MBA doesn't actually need us to query or to or to be confident that um they can kind of read the data transparently digital assets can be that connective tissue the fan currency the Gateway um into uh all kinds of different products and services around a unified Fan Experience and what I mean by that is anything you do in the world of the MBA should get recognized and rewarded in MBA top shot and the status and ownership and ACC and and value that you build with an MBA Top Shot should get recognized and rewarded in the world of the NBA we're putting our money where our mouth is this season and it's taken a while to get the product ready to this point but but I think we're getting there we we will have full integration with the MBA app itself and so such that every person that goes in to sign up for an MBA ID can also at the same time get their first digital asset get their first digital wallet rip a pack and maybe in the future get more benefits directly from the NBA Inside the NBA experience I mean the first version will make them go inside our product um and in the future they will be able to do things inside the MBA app itself the other thing we're doing is we notice that the most exciting rabid viral sort of authentic thing around you know other than talking about big sale prices and we'll talk a little bit about that was uh people going to live games people getting together to watch games and ripping packs together and so said how do we lean into that gameo experience uh because we're also seeing something else that people aren't talking about in this room one of the biggest crypto consumer crypto products ever today is actually Ticket Master The Fortune 500 company Live Nation Ticket Master has a product where they give have given out tens of millions of ticket stubs digital ticket stubs to people that buy digital tickets and these are markers of identity and provenance that 10 years from now people will look back and say hey my digital wallet the first thing I had in there was a ticket to this concert or the ticket to this NBA game or the ticket to this NFL game uh 13 million people have gone in to claim their their products and so tick Master is actually the biggest product on Flow the blockchain that Dapper originally created but is now um independent and led by uh deer and team uh but we saw people doing crazy things with with uh with both topshot and all day at all kinds of NBA NFL games we saw the excitement around Ticket Master itself and how people are going in and collecting these tickets STS even though they don't have any sort of Journey or utility beyond that today and so we said well let's partner up they're already building off flow we're building on Flow the the the data is all open and let's figure out how to reward people for going to live games first starting with the NFL games that just happened two weeks ago and every single game for the next four weeks people that digital uh T physical ticket goers will be able to claim their first uh NBA top an NFL all day pack and that pack will have a moment from the game that they physically went to and so they're collecting a memor a piece of memorabilia from that game but they're also getting an experience that a Trading Card Collector or a jersey collector wouldn't be able to get other than if they're going to buy game used merchandise game used uh jerseys Etc spending millions of dollars hundreds of thousands of dollars um and so this is a way to democratize that experience carrying something real home with you and we're starting to see some signs of optimism across both NBA toshan and F Al day obviously we've been hit with the same same um momentum shift in nfts as a category but my that's my point everything has to be beyond Behind the Scenes these are just digital traing cards that you can play with actually I'll talk about playing in a second um but we had our our highest ever rookie sale $145,000 for Victor wanyama a one-on-one rookie card and absolutely generational Talent we're we've also seen every single pack drop across NBA WNBA sell out over the past 69 months um premium drops with an average 5x more demand and supply and MBA in a wmba which actually has our new kind of economy design in a more um usable way we've seen much higher Supply to demand ratio 16x more orders placed than packs available um and every single thing that we're selling is reselling on the marketplace for for higher than we sold it for um and that's that's the kind of kind of Crypton native sort of um uh indications that start showing uh some you know you know viral traction but we got to be careful because the we got we want authentic users and we want an authentic experience um same thing with across the NFL we had we've had maybe the most exciting NFL rookie class in in history or at least in the past few decades um and it's being reflected in our numbers 135,000 orders for the first two uh sets of rookie packs which about 14,000 14,000 packs um and and but the thing I'm most excited about is that our products now have in the we introduced at the tail end of the last NBA season a feature called Fast bre break daily gameplay so you can actually play with your stuff now you can come up to the site every single day and do something that doesn't involve buying and selling involves playing uh predicting uh playing against your friends with your friends whatever you'd like and this season with the NFL is the first season that um it's going to be from the beginning across both Sports um daily gameplay or weekly in the case of the of the NFL and we're seeing huge impact on our numbers and these are all kind of normal sports fans but they're normal sports fans that in their daily sports fan Journey are spending a lot of time and money inside other real money products like sports betting like fantasy um and others um and want a way to connect with their friends and their communities in a new way so the the average revenue per user our Revenue per user for folks that play Fast Break um to tail end of last season was orders of magnitude higher than our um than our normal user base and we're excited about that so like I said this season we just introduced Playbook last couple of weeks um uh someone won two people won $10,000 actually this last um last week and um and uh and so you can place picks for free but you have to have moments in order to participate in the higher uh higher tier so it's kind of like a free-to-play game that you can play with your moments rewards collectors for having a broad collection but it's all an exciting way for people to connect around the things that they love and the exciting thing that I want to uh announce that's relevant for the hackers in the room for the hackathon in a couple of days is that eventually all of this will be put on chain and so others can build derivative experiences on top of it as well as calculators utilities things that uh Gamers can use to kind of get an edge but today or at least for the hackathon we're going to open up the public API and so people can sort of play with the kind of information that is going to be available onchain and the composability and utility that that hopefully engages on the point that the last speaker made is exactly right if you build for an existing audience day one you have people that come try out your product product maybe provide Revenue but at the very least provide feedback and an early um uh sort of a jump start to your to your growth cycle all of this runs on flow.com but what I want to call out is that flow is as of two weeks ago um two three weeks ago fully evm equivalent and so anything that works on eth Main net works out of the box on Flow and the bridges and interoperability between everything you build on flow back to ethereum is much better than it was before and this wasn't NE necessarily um you know the the the way we build flow originally and derer can talk about a lot of his technical leadership over the past few years we've innovated a lot on the user experience on the scalability on the complexity of how you can write more interesting smart contracts without uh being scared of you know hacks and and uh and vulnerabilities but the key thing that we've um we've done in the last few weeks is built those bridges back to ethereum and so in in a sense even our own products MBA Top Shot Etc can benefit from everything that you everyone in this room can build whether it's defi whether it's um gaming utilities and uh and and there's few exciting things coming out from there as well and a lot of the things we launch on Flow will also be bridged back to ethereum and so you'll have for example fungible tokens that represent uh liquidity pools of NBA top shots at various levels and they'll be a bridge between ethereum and flow and so you can uh purchase on ethereum or on Flow and people can Market make back and forth and that just provides liquidity for folks so instead of selling each item individually they can throw them into a liquidity pool instead of buying items individually they can buy bulk um resell repack themselves Etc it opens up new avenues um compared to compared to anything else is possible in the physical world um so Flo is consumer ready it's had um nearly uh 700 million transactions processed in its life cycle um but like I said just now it's become open and available for everybody else to build on its biggest application is not Dapper laabs Dapper laabs is a minority of the network in every way and it's run fully independently by a foundation um that that we can speak to um fully interoperable that means anything you launch on Flow can actually work all the assets can work back um with everything on ethereum metamask openc whatever it might be and everything that works on ethereum works on Flow just like an another L2 the difference between flow maybe again analogous to the last speaker and any other generic L2 is we've invested the last four years into that consumer experience and and every single Builder on flow is trying to build a consumer product um and that audience of normies in a sense but also folks that want access to the Crypton native benefits that um that the blockchain provides um that exists on Flow so really exciting amazing uh uh ecosystem and uh I want you to be a part of it so we're we're going to be joining the eth global hackathon track we'll be joining every single e Global event um for the coming future and and excited to uh to be part of the ethereum ecosystem uh again uh we started here we built all of our first products here um and excited to uh to build all the next set of products here so thank you very much especially if you've been the collector of crypto Kites and uh our MBA topshot and uh thanks for having me enjoy the conference [Music]