'Internet Renaissance' - Jacob Horne & Dee Goens

Jacob and DD are co-founders of Zora, and they will talk about the NFT paradigm and inverting the internet in a talk called “ called “ cryptomedia.” So without further ado, please welcome Jacob and D, and let's hear more about cryptomedia. Let's start the NFT hack and summit. Jacob D. Sweet.

Wait here. I'm just going to share my screen. One second screen. One second . Yo.

Good. Do you see my screen? You are fine. Perfectly. So, yes.

Hello everyone. Hmm, D and I are very excited to review this report and presentation today presentation today . Hmm, we called it the " . Hmm, we called it the " Internet Renaissance." Hmm, so let's move away from the name cryptomedia.

I think, uh, what we want to talk about today is essentially the point in time that we're at in the ecosystem as a whole. Hmm, I think NFTTS kind of catapulted into the zeitgeist and had this amazing moment. I think we want to take a step back and talk about why this moment is happening right now? What is the history and state of the Internet that has brought us to this point? What NFTTS is as a paradigm, why they are important, and then most importantly, where we think this space is today and where we think it needs to go.

It's still incredibly early. There is still so much to build. And I think that, uh, yeah, we're just happy to look into those details. So, uh, yeah, just a quick introduction about me. I am Jacob.

I'm one of the co-founders of, uh, Zora. I used to work at Coinbase before Zora, where I worked with D, and I'll let D quickly introduce himself before we start. Yes, D, another one of Zora's co-founders. I met Jacob while working at Coinbase. Uh, I'm into all things artists, creators, etc.

at Zora. So creators, etc. at Zora. So , yes, I'm very happy to be here. Thank you for inviting us.

Perfectly. Okay, let's get started. So, let me just click " just click " Next." Let's start with the obvious. NFTTS is undoubtedly a paradigm shift.

Hmm, and specifically, they are a paradigm shift in information ownership information ownership . So if we think about the internet before NFTs, those were the two dominant systems of information ownership. So if you think about the media that you create, you know, content, anything that goes online, there have typically been two ownership systems that have defined how we create and distribute media today. One of them today. One of them is the copyright system.

That is, the legal system that is established by governments and in various jurisdictions around the world. And copyright is defined as follows: if I own this piece of media information, I have the right to restrict reuse and distribution, as well as copy, paste, download, etc. Hmm, so it's something like a fiat information ownership system. The second type, which is obviously related to copyright, copyright, is platform content, as well as ownership of media and information. So when you create a media file or content and publish it on a platform, that platform monetizes that information, creates value, generates value from it.

And if you're a big enough creator, you can see some flow from that ownership. But for most of us, as with everything we create online, the value rounds down to zero, and the platforms monetize it and essentially have actual ownership of that media content, not us as creators. So the problem with the two dominant systems of information ownership is that it's a kind of paradox: to generate value from that information, you need to restrict access to it. So you're essentially building a platform that essentially functions like a walled garden . This forest garden is built on advertising, subscriptions, or paid viewing.

And the paradox is that you want to build a world garden, but fit everyone in the world into it to maximize value capture. So, if you imagine that the universe is the internet today, we live on these mega-platforms, on these huge global gardens that bring everything together in one place. So all the media that you create, the social graph of people creating and interacting, the community on those platforms, and those are the platforms that can benefit the most from owning that content. Hmm, so our point is that we never really avoided the internet. You know, Instagram, TikTok, YouTube, Facebook, Spotify—they're all essentially private networks essentially private networks that take responsibility for the media, content, and information that we create.

They monetize it better than any of us. And then, you know, we get paid in social currencies like likes or followers. And, as I said before, if you're big enough, you can get AdSense revenue or a share of the actual dollars earned. Hmm, and this is the whole mental model that shapes our perception of information possession. Supposedly, for this to generate value, we must limit access to it.

So, NFTTS, there are kind of two similar quotes that I think are worth remembering: what's really going on with this new value system? Why are NFTs a paradigm shift and a complete inversion of our understanding of media ownership? So the one on the left, Stuart Brand in the 80s, is calling out that information wants to be free, but information also wants to be expensive, and that tension is not going anywhere. So if you think about it, it's like information that we want to share, we want to copy it, we want to download it, we want to give it away, we want to spread it as widely as it wants. But in the previous paradigm of information ownership, this contradicts the fact that the only way to generate value is to restrict access.

The second kind of gem to remember when thinking about NFTTS is a quote from Mackenzie Vokle, which she said in 2016 in a wonderful essay called “My Collecting Ass.” Uh, the future of collecting may not be so much about owning what no one has, but about owning what everyone else has. So it's not about owning something that no one else has. You know, you might have a physical piece of art that only hangs on your wall, but what if you owned a media file owned a media file that's on the screens of millions of people? It's a very strange way to think about ownership, but in practice it's a step towards what's actually happening, and what's made possible by NFTTS, which, you know, alleviates this constant tension that was caused by the pre- Internet, which is how can we have information that is both universally free and available for consumption, but also recognized for its inherent value to society and to whoever was the creator of that information?

So NFTTS information? So NFTTS is a paradigm shift because it changes our understanding of information ownership and really gives us the best of both worlds for information ownership on the internet. So, for example, just think about how this works in practice. And if you're already somewhat familiar with NFTs, you've probably heard the Mona Lisa analogy a million times, but if you imagine NFTTS as something like the Mona Lisa, the Mona Lisa as an artifact Mona Lisa as an artifact , then it's individual property but in the public domain public domain . So anyone on the planet, anyone on the internet can freely copy, remix, distribute, print on a poster, put on a T-shirt, post on Instagram.

And each time such distribution or reproduction occurs, it does not diminish the value of the original. It actually makes the original Mona Lisa more valuable because it becomes more famous, more culturally significant, you know, has more popularity, and as a cultural artifact, the more widely known it is the more widely known it is , the greater its value. So, to change the perspective with this, you know, visualization and, you know, rough analogy, it's something like: well, what if that same value system now started to apply to every piece of information, media, and content on the internet? Hmm, you know, whether it's memes, YouTube videos, Instagram posts, faces, websites, themselves. What if we now had this canonical original, this proven original that may be owned individually, but is now universally available to the entire internet for free sharing, copying, and distribution, built upon?

Hmm, and this is where the NFT will be today. So, you know, with NFTs, it's the opposite of copyright or the opposite of how platforms operate. It's as if the more you copy-paste, the more you distribute, the more you download, the more it's displayed, the more valuable you make that original copy. Hmm, the more valuable you make this NFT. So, if you think about pre-NFTTS, that's how most platforms could be viewed.

You have a platform that is a kind of global garden where content is unified and restricted. And to move it between platforms, you need to copy and paste, duplicate, pirate, download, etc. NFTs completely change everything to the opposite side. Now you can have one NFT, and have one NFT, and any platform on the internet is free to build on top of it. Instead of TikTok having a monopoly on the entire TikTok content database, what if every developer on the planet had complete universal access to that database?

Imagine if we had just this single feed experience that everyone could build on, or what it would look like if there were now thousands of were now thousands of websites or apps that could create, remix, and curate all of this content, not just TikTok content, not just TikTok . Hmm, that gives you a sense of the platform inversion that is happening through NFTs happening through NFTs . So NFTs are definitely a paradigm shift in our opinion. This is a paradigm shift that is already halfway there. So the current structure or ecosystem today is that we have an amazing ecosystem of galleries or, as you know, a nomenclature of marketplaces.

So there are probably 15 to 20 different marketplaces now, and one of the most, and you know, it's all integrated, you know, at a lower or higher level, however you look at it, with OpenC. But, essentially, one of the biggest questions facing a novice creator coming into the ecosystem is: " which trading platform should I mine on?" And then the problem is that when you mine on a trading platform, the trading platform owns the market; you end up getting attached to this trading platform in many ways. Sure, on some of these marketplaces you can take your NFT after the sale and start moving it around, but unfortunately the value system that exists there is built and maintained within the marketplace itself. So marketplaces charge commissions as soon as you make an initial sale or move one.

It's like: where is this value capture happening? And it's not that there isn't any compatibility between trading platforms today. So you can have anywhere from five to as many markets as there are trading platforms on a single NFT. So we find ourselves in a situation similar to the pre-NFT internet, where, well pre-NFT internet, where, well , okay, now I have to choose which platform I want to bind myself to, which one I'm going to mine on, and then get all the value, but there's not the kind of interoperability that the technology allows. So media and content can be universally accessible, but now we see a separate marketplace for each platform, which kind of gives us this illusion, and you know the idea is that NFTTS are tied to marketplaces.

So for us, Zora, we started as a marketplace, and we like that model. We have a strong curatorial sensibility. We have the ability to charge for everything that happens. And when we started creating NFTTS, we had this awakening that there are amazing NFTts on every one of these marketplaces . And it's one thing for us to curate and point to one of these NFTs, but what we wanted to do was say something like, "Hey, this incredibly beautiful piece of art is on Super Rare.

Wouldn't it be great if we could just point to not only NFTs but also the marketplace on Zora so we did n't have to compete in this zero- sum competition for absolutely every artist to win? What if there was some common public level that meant we were all building on the same market? What if this market could belong to the creator himself? So we faced that first . We realized that the whole reason we're building on this technology is to create a new open and public infrastructure for creators so they can reclaim ownership of their works.

And the way trading platforms operate contradicts this to some extent. We ourselves are like a world garden, and we get very early memories of the early era of decentralized exchanges. So, if you remember, for those who were in cryptocurrency at the time, there was this first wave of decentralized order book-based exchanges, and they were...in the right direction. It was like: yes, there should definitely be decentralized exchanges based on protocols, but the early instances were a bit scummy.

It was something like: why don't we take the stationary order model that we see on traditional exchanges like Coinbase, NY or NASDAQ and bring it to the blockchain. But what ended up happening was that even though it was a global and open system, you still had all this fragmented and competitive liquidity. Therefore, it was very difficult to create this single system that would allow liquidity to gather in one point. And, most importantly, most of them were not completely unauthorized. So you needed to convince a specific relayer or DEX to actually host your token.

It was not an unauthorized and public instrument public instrument . There was still a kind of middleman you had to go through to access the technology. So the transition from early DEX to something like unis swap actually happened for three reasons. This was a completely new market model that did not exist before cryptocurrencies. Hmm, that was...

a model that led to global liquidity. So it was a more efficient model. Instead of fragmenting all these different order books, the question arose: what if it was possible to combine everything into one pool? And then, third and most importantly, it was completely permissionless and completely open to any developer or person on the internet to use and run an exchange. So for $5 or $10 in gas, you could launch an exchange and get the same power right out of the box as a developer as you would have the full power of something like Coinbase or Binance, which is a huge paradigm shift, you know, you can get a DEX with a few lines of code.

Um, so for early NFT, I think we're seeing something like that, so it's the right direction. There is no doubt about it . Yes, there needs to be a market model and a way for creators and, um, the people who create the people who create , curate, and collect these NFTs to capture value. But the model is again a bit... again a bit...

scummorphic. It's like, let's bring in an auction house and put it on the blockchain, and we'll be in a similar situation. There's a lot of aggregated, fragmented liquidity that they 're trying to aggregate in multiple different places, but it results in creators having to trade in 15 different places for fragments, not just the markets for these NFTs, but also their identity on these platforms. Um, and most, if not all, are generally not unlicensed. Um, so there are different, um, curatorial standards that most marketplaces don't have: open source or verified contracts verified contracts .

Um, they're not fully open tools that developers can build on and benefit from, like, this liquidity from the start. So for us it was like, "Well, okay, we should make the same conceptual leap for NFTTS, what would that mean? What would the new market model be for NFTTS?" How will this model provide global liquidity that opens up, ahem, the opportunity for the opportunity for any developer or creator to easily start building on top of this, ahem, new paradigm, and how can we make it completely permissionless? “So, if we talk about the new market model on the network, we designed the entire protocol around this: instead of being a marketplace as a protocol, NFT is a marketplace marketplace .

So you know exactly where the market should be. The amazing thing about NFTs is that they have a very unique market structure. There is only one to many. There is always only one owner, and there are many people trying to buy. So it's a completely different thing than, say, a fungible token fungible token , which has a , which has a many-to-many relationship.

So while something like a unis swap or a sushi swap or a similar model might be " might be " winner takes most", it's very difficult for it to be " difficult for it to be " winner takes all" because the types of connections you need between these many buyers and sellers mean that you're probably going to need multiple forms of market anyway. For NFTs, things are completely different. You are squeezing the market to one point every time the market to one point every time . You know exactly who the owner is. So the protocol was designed entirely around this idea.

It’s like, let’s build a marketplace into the NFT itself and let’s transfer ownership of that marketplace to the artist.” to the creator of this NFT. So, when you create your NFT, you create a market for it. And this market is completely open for open for anyone to build on . And there are some interesting design decisions that you can see in the documentation that we'll reference later, where it's not about the highest bidder .

So anyone can bet in any currency. Anyone can place a bid at any time, and you, as the owner, are not obligated to accept the highest bidder's offer. If you see an anonymous bid for, say, $10,000 and then a bid from Kanye West for $500, you may be inclined to accept the offer from Kanye West because it could increase the value of your work in the long run. And in this token there is the concept of creator's share and permanent capital. So you can realize this time.

So, the results of the protocol the results of the protocol . So, it should be noted . So, it should be noted that the protocol deployment method was a one-time thing. So in the Zora protocol, we didn't create any possibility for updates. Any updates would have to happen through, you know, social consensus.

Um, that means the protocol is completely unstoppable. So we can't stop the protocol even if we wanted to. Anyone can create data on it . Anyone can interact with markets. It's essentially an open public infrastructure that allows for the creation of these, um, NFTTS that can survive beyond the lifecycle of any particular market or platform.

Um, and, you know, making it as permanent as possible. Um, so to speak, regarding permanence, essentially, every time you create a token on the Zoro protocol, you have to create a content hash, a SHA 256 hash of what that piece of media is. Uh, this hash, once you create it, is immutable. You can never change it. And that means that if you need to say that you initially chose IPFS or Arweave or even AWS as a place to store your media, if that file storage solution for some reason turns out to be broken or was wrong or there's a better model, you can always...

can always... the owner can always update the reference to that token. at any time. Hmm, and the content hash means that the public can always verify that this link points to that particular media file at that moment. If you try, you know, if you buy a token and change the link to a media file that is not what the NFT was created for, it will be easy for the public to compare that to the signature of the media file in the hash.

Yes, but when you create on the Zoro protocol, your NFTs are completely platform-free. So if the zoro.co website, you know, disappears or the team disappears, the market still works for it. NFTs still exist. Anyone can build on it .

So you don't need our permission to create your type of NFT. This can be literally any form of NFT you can create. And the permanence aspect is how we can create mechanisms that mean that this NFT as an artifact can exist as long as the Ethereum blockchain itself, which can last for decades. Or, depending on your optimism about blockchain technology, NFTs will last as long as Ethereum itself, which could be an extremely long time. Another point worth talking about is the concept of perpetual ownership.

So if you think about someone like Jean Michel Basat, it's like his original first painting, sold for $200 in the early 80s. And you know, as culture and society woke up to the beauty and popularity of his art, that value grew over time to tens of millions, hundreds of millions. In the traditional art world, resale royalties have been attempted for hundreds of years, such as in France in the early 1900s, but they have not become common in auction houses. So, as these works are bought and sold over time, artists almost completely lose the opportunity to earn some of the value they created through these works as they changed hands. In the Zora protocol, you know, when you mint coins, you can...

Determine, well, what resale royalties would I like as a creator, as this thing is bought and sold in the future. So it could be 10%, 20%, literally anything you want. Hmm, and it's built into the protocol itself. So, once you decide on a protocol, that royalty will be paid by the market. Hmm, and our view is that instead of seeing 10 or 20 marketplaces that help people browse, curate, collect, and use NFTTS, there should be millions of such marketplaces.

So maybe every maybe every website that exists, you know, now every website can build on this publicly available media content, they have to have a direct connection to the marketplace itself . Hmm, so by consolidating the marketplace into one place, making it permissionless and open to everyone and open to everyone , you know, every , you know, every website can now be a marketplace in some form. Hmm, so to go back here, I think we can get closer to that direction because now we have this public and open level where now each of these platforms, if they start curating their own subset of NFTTS their own subset of NFTTS that exist on the protocol, and, you know, someone in their community likes a meme, or a video, or you really like a song, if that platform still wants to help that person directly gather information and interact with the market on their own website, they can do that. She doesn't need to push you into some other market. Every website can become a marketplace in essence.

And we are starting to see And we are starting to see this happening. You know, the Zor protocol only went live at the beginning of this year. Hmm, and we're already starting to see such unique and specific impressions of the protocol. So the one that was launched, um, a few weeks ago, works with the catalog. Hmm, so you know they create a very, um, specific musical experience.

They want to come to the Spotifys and Soundclouds of the world and explore what it means to explore what it means to , you know, return, uh , you know, return, uh , ownership of music and the value of music to musicians. And it's a very special experience that, you know, you could never do for...like, this experience wouldn't be... this experience wouldn't be... maybe working for memes, or, you know for memes, or, you know , fonts, faces, or any other type of market that you want to see.

We should see a very rich diversity of experiences based on the types of NFTs that are created. And then, like Mirror, this amazing tool, for example, for writing for example, for writing , so moving on to the Mediums and Substacks of the world, it's like: well, when you create your writing or your blog posts, your essays, whatever, that's also created on top of the Zoro protocol. Hmm, and again, it's a completely different experience than cataloging. And I think we try to help teams over time build and create unique social media experiences, marketplace experiences, or niche markets that we can help execute. So if you want to create an auction house specialized in memesp, you can do it.

If you want to create a marketplace just for music samples, stems, fonts, code snippets, 3D code snippets, 3D objects, or, you know, any form of information or data... information or data... or file type that you can slice and dice and create a very rich and unique experience. Um unique experience. Um , and then you know you can start integrating and curating all these different places because you're built on a shared, um, open layer.

Um, and again, as you know, we're starting to see very early examples of what this type of ecosystem looks like. We have radio stations. Um, someone created a kind of TikTok-based interface on media in virtual worlds of the protocol, you know, interesting text, um, collectible impressions, and then, you know, someone in the Zora community created the Zora interface even before we did. We deployed the protocol a month before zora.co.

co launched, and, you know, we saw someone in the community just build their own interface on top of it because everything is completely open, which was a really cool moment for us. Um, so to speak, some of the things that the Zora protocol unlocks, now that you have these trustless markets, it essentially unlocks the trustless Dow and all these interesting use cases. So if you think about the DAO if you think about the DAO that generates the Azora NFT, the DAO is directly... DAO is directly... interacting and accepting bids.

So today, if you build the Dow Jones like we did with Staint Fame, you would, for example, create an NFT, because markets work separately for each market, you need to figure out how the Dow Jones can interact with that market, and in many cases there is just no direct maximum for that. Now, if you think of an NFT with a built-in marketplace, if there's, say, a thousand dollar bid, the DAO can vote to accept that bid without trust. Um, and if he accepts this bet, the funds can then be invested trustlessly in the Dow Jones treasury, or distributed among token holders, or used for any collective action. Um, and this Dow Jones is just to give you an idea, you know, a visual representation, like yeah, this Dow Jones can be driven by, obviously, a token, but they start to drive any number of NFTs and can accumulate value without trust, and you know, um, from the activity around these things. So you can see that if you had collectives of artists collectives of artists who...

now collectively create under one name or one collective identity. What if you had Dows that were currently collecting as a community? So you can have, you know, our hip-hop, one of the biggest, like subreddits. What if they could raise capital, and they could start ordering, bidding, and collecting NFTTS as a community, and they could vote and then, you know, take bids, auction it off , and they could trustless and then, you know, create and accumulate that value together and distribute it. Hmm, and there are amazing early examples of this, like Flamingo, but the trustless nature of the protocol now means that it's very easy and straightforward to create an open template that anyone can now start building for each community individually.

Hmm, which brings us to these very interesting community ownership ideas both for Dow who want to collectively create, curate, and collect together, and it allows you to layer community ownership on the level of the platforms themselves. So if you think about the catalogs of the world with their music, it's like, well, if they're facilitating these auctions, curating as a community and curating as a platform, it's very easy to programmatically drive the capture of value from these platforms as a community and distribute it to everyone who uses these platforms and marketplaces. So we really think we're entering an era of the Internet renaissance, because we're actually getting closer to what the Internet was really supposed to be. We are entering, as if we are leaving this vast internet vast internet era, and heading into a world where anyone can create content that has no platform and can stand on its own, have its own value, and be fully interoperable, universally accessible, and open to all. So our view is that social media platforms as we know them are dead.

It will take a very long time for them to completely disappear. But there are very direct incentives, and I think the general desire for people, you know, we all know and feel that, for example, if we're on Instagram or YouTube, we might feel like it's not quite our own space, or, you know, you have... you know, you have... wading through ads; and you know, the way value is captured on these platforms, the way they're built, is completely at odds with what information wants to be, which is: it wants to be free. So our view is that mega-platforms are no more, and they will be replaced by public, permissionless protocols that are open and accessible to everyone, not just the foundation, not just the platforms that are building these huge global gardens.

And that, as you know, there are now tools for creators and communities to have their own platform, and you can be yourself or create your own or do whatever you want, because you know the initial state or the path to entry to launch a valuable platform is much lower. You no longer need to compete and catch up with the entire Instagram or TikTok content database. Now you can build on and stand on the shoulders of all the content in media . Now it all comes down to how you want to curate? How do you want to present and perceive all this content?

You no longer need to build and catch up on this content. You can just start from there and start, you know, really experimenting and creating your own rich and unique experiences. Hmm, and this is only possible when you have a completely public and permissionless infrastructure. Anytime you have, uh Anytime you have, uh , permissioned access or centralized control, the incentives ultimately shift toward, you know, protecting that value capture mechanism, rather than whether it's public and permissionless by design. No one can really stop you or stop anyone from creating or creating the way you want or how you can change the terms of how you, uh, create on this infrastructure.

So it was critical for us that when we deployed the Zora protocol, it was open source, fully audited, double- checked, and deployed in a way that was unstoppable . So if we ever wanted to upgrade to Azor v2, we couldn't just flip a switch at the smart at the smart contract level and force everyone to upgrade. We would have to create a whole new instance and, you know, provide an option or a path for people to transition, but only if they want to. Zora v1 can never be changed, updated, or stopped. It will always exist as an option that is public and available to everyone.

Er available to everyone. Er , so. So, if you want to learn more about the SDK and the tools we've built to make it easier to interact with it, this is kind of a starting point. Hmm, zoro.engineering, engineering.

We have an official document, the source code of the protocol, a link to GitHub, and then a subgraph and, you know, uh, JavaScript tools so you can interact with the protocol. Also join us on Discord. So, the Zoro community. If you just follow this link, it will take you to our Discord, and we have channels there where you can learn about the protocol, ask questions to the developers, and just interact with the creative community that is growing there. Uh, and then investigate everything that happens in the protocol.

Zoro.co is a kind of general, uh, explorer, and, you know, open marketplace that allows you to interact directly with everything. So, uh, that's where you can see exactly what's being mentioned, who's betting on what, you know, you can see everything from there. Uh, and yeah, it's kind of like yeah, it's kind of like ... A bird's-eye view of how we think about the different parts of the stack that we're building.

So there's the protocol itself, the OS, the SDK, and then of course the interface, the open source interface, and the open interface so that anyone can peek in and explore everything that's going on in the protocol. And our long-term goal and what we're striving for is to have everyone interact with Zora everywhere except Zora. If we just create a huge megamarketplace that everyone has to come to create, share, and trade all these NFTs, then we are going to fail. We want millions of marketplaces to exist, fundamentally powering the Internet itself. So Zoro is successful when it is everywhere except zoro.

co, or most used everywhere outside of it. Um, yeah, that's kind of the end. Um, and yeah, I don't know if there's a question in the chat or if you wanted to add a little color, but uh, yeah, this is the beginning of the internet. Renaissance. No, I think it was pretty perfect.

Incredible. Uh, Jacob D, thank you very much. So I'm, uh, just going to ask you to, uh just going to ask you to, uh , just turn it off.