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The Future of Gaming DAO or FOGDAO is a decentralized, tokenized community exploring the future of the gaming industry.
00:00:16:18 - 00:00:44:00
Nico Vereecke
GM friends and welcome to the future of gaming. You're listening to our weekly FOGcast. We have Philip Collins and myself Nico Vereecke as the usual FOGDAO representatives. And today we have a very, very special guests. If you have spent some time in our discourse, you will know this man. He goes by the name of Tim Cotten He's the founder and CEO of Scrypted
00:00:44:08 - 00:00:57:16
Nico Vereecke
Is very opinionated about a large number of topics when it comes to WEB3 comes to gaming. And when I say opinionated, I mean that in the best way possible. So, Tim, amazing to finally have you here.
00:00:59:01 - 00:01:07:01
Tim Cotten
It's great to be here. Thanks for inviting me on. You know, I love FOGDAO and I love what I hear every every week in the Fogcast
00:01:07:01 - 00:01:17:08
Nico Vereecke
And I'm sure that every week when you're listening to the Fogcast you're like you're you know, you can't wait to, like, give your opinion about the things that we're discussing. So this is your chance, man.
00:01:17:08 - 00:01:23:15
Tim Cotten
Or just is it brains? Because there's so much knowledge here that I love talking about, especially from a game designer standpoint. You know.
00:01:24:18 - 00:01:44:02
Nico Vereecke
I appreciate the nice words. Good. So what's the plan to talk about today? As usual, I'm just going to stop trying to predict what we're going to talk about because we don't really ever know. But the first topic I wanted to touch upon, which is kind of number three related, at least initially, like I find a way to turn it into what, three separate topic anyway, right.
00:01:44:03 - 00:02:13:13
Nico Vereecke
So what happened last week? I believe I'm on Sunday. The when was this? I don't know by heart. I think Sunday the 26th or the 19th of February. See us go, which is a more than ten years old game reached its top peak concurrent user base ever. So more than ten years after the game was launched, the managed in some shape or form to gets like the largest amount of people playing the game at the same time ever.
00:02:14:20 - 00:02:36:00
Nico Vereecke
Why is this special? It's special because there was, in terms of gameplay, very, very little updates, right, that the game didn't change profoundly. There was not a lot of big, big new content that came out. It's an old game. It was an old engine. If you look at it, if you compare it to the newest call of duty, if you compare it to most of the modern games, it looks pretty shitty.
00:02:37:06 - 00:03:02:05
Nico Vereecke
People keep complaining about it's everyone kind of hates it, but still people seem to love it. It's a really, really well-designed game. It's well-balanced. It has a fantastic e-sports scene. And then now comes a triangle. One of the things that happened was that they launched a new Create drop, which includes new skins and guns skins. And so and it was like it had been seven months, which was a long time.
00:03:02:05 - 00:03:25:22
Nico Vereecke
And so people seemed to care so much about ownership of digital assets and ways to show that off, that the drop of crates, which are essentially loot boxes with skins in them has had resulted in, you know, such a boost in playerbase. So, you know, we we might still be onto something in this whole crypto thing after all.
00:03:26:18 - 00:03:37:06
Tim Cotten
I like your enthusiasm for that. I I've always felt that cosmetic design items were the way to go. When you want to sustain a community for a while without burning out everyone.
00:03:38:11 - 00:04:04:07
Nico Vereecke
Yeah. I also think that's the and especially right I would say has has perfected this playbook or at least they've started it. Is that you know cosmetics are a great way to monetize without essentially taking fun away from other people. Because if you're doing Bitcoin which is something that I absolutely dislike and hate, that's not the case. But cosmetics are just perfect and the amount of money people are willing to spend for cosmetics just keeps blowing my mind.
00:04:04:22 - 00:04:27:20
Philip Collins
Yeah, And I mean, I think we've seen this a lot with the battle pass model in the past, right? We're all log into Call of Duty at the start of a season. Haven't played in two months. Probably won't wait for and probably won't for another two months. But the notion of new content and the new objective to explore even with minimal changes to the gameplay really is enough just to get people to kind of get back onto the platform to try it out.
00:04:28:04 - 00:04:49:19
Philip Collins
And I think, like you mentioned, Riot's done a really good job of this. And like the Valorant market where refreshes every 24 hours. So you end up coming in check on what your latest skins are, and then you inevitably end up playing a game and you get sucked right back in. So yeah, I think we've seen cosmetics be an interesting driver of engagement and retention, which is kind of funny because it's so non-core to the game, especially in these non pay to win titles.
00:04:49:19 - 00:04:56:06
Philip Collins
But I've been a victim of this myself, so psychologically I've pretty good example of it working.
00:04:57:10 - 00:05:24:17
Tim Cotten
Yeah, I, I probably, I don't know if I've told you to this story before, but when I was at here back in the early 2000 when free to play was first really coming onto the scene and we didn't know what to call everything yet. I remember we did a brown bag lunch with someone from Shanghai and they had this they had all this knowledge about the Korean market and the Chinese market about how these cosmetic games were working, and they were really focused on kart racers.
00:05:24:17 - 00:05:39:12
Tim Cotten
And he warned us, you know, if you go for if you go pay to win with this, it's cheap and it's easy and you'll make a lot of money, but it's going to burn out. Your player base is all the faster. And you know, we really did experiment with this idea in the online vertical with Sims Online Ultima Online.
00:05:39:12 - 00:05:51:20
Tim Cotten
We tried different free to play mechanisms for both sides and hands down the one that kept subscription levels like steady or going back up was the cosmetic stuff. People wanted to decorate their houses.
00:05:56:03 - 00:06:38:17
Nico Vereecke
As a side discussion here, I want to get your thoughts and specifically Phillip's thoughts on e-sports and how you're looking at games and game design and its potential for a thriving e-sports scene. So I'm an E-sports fan. If you've spent time in the East, the dedicated e-sports channel in the Discord, the Fortnite discord, you'll know this. And I've noticed that, you know, I keep coming back to or I have this draw towards games that I've played and I've spent more money in games that I enjoy the competitive scene of and it feels to me like one of the one of the reasons why Cisco is doing so well is because see as go is extremely
00:06:38:17 - 00:07:06:09
Nico Vereecke
well like a good e-sports to have. So it's a good game to have any sports around. Right. I almost eight months ago there was like a live so basically the e-sports which one was I forgot the name, it was a tournament and the finals were here in Belgium and I went and it's just amazing. The vibe is amazing is well designed because it's, it's with rounds and so you basically have like an exciting climax almost every, let's say 2 minutes, right?
00:07:06:10 - 00:07:25:07
Nico Vereecke
Because every round has like kills and a lot of stuff happens if you compare that to other sports, like football, for example, you can you can like in football, people can pass the ball around for 90 minutes and nothing happens. Right. And in Cisco, you can you know, there's so much skill expression as well, right? So you can have one player who's just lucky you killed five people all of a sudden.
00:07:25:07 - 00:07:49:22
Nico Vereecke
And these are just crazy moments. And so sorry, I'm rambling, but you see that I like this. But my my point is that I think part of Cisco's success and part of League of Legends success and part of other games success is that they were well-designed to be a enjoyable, like watchable e-sports. And I would say that's sort of overwatch is probably the counterexample of that.
00:07:50:04 - 00:08:04:14
Nico Vereecke
I don't know if you guys ever tried watching an Overwatch game as a spectator. It's just horrible. You have no clue what's going. So if there's a bunch of shields in and just like these small characters that are pieces that are like blinking around on the map and then you have like snipers, like trying to shoot around the shields.
00:08:05:00 - 00:08:14:12
Nico Vereecke
So I feel I'm going to get to my question. How do you think about this? And is this something you take it too into consideration?
00:08:15:00 - 00:08:36:23
Philip Collins
Yeah, I mean, I think competitive competition is an incredibly valuable asset for games that want to be the type of forever game that we've seen Counter-Strike become. And then we've seen Riot excel at their league and now through Valorant that keeps people coming back. There's a very clear progression system. The game feels very linear at times where you don't even have to change the gameplay.
00:08:36:23 - 00:09:08:00
Philip Collins
You don't even need new maps very frequently. You just want to continue to excel at this, at this structure that that, that, you know very well as a player. And so I think from a from a game perspective, it's extremely compelling for retention, longevity and maximizing the value of those users over time. Because like you, I've seen myself spending the most in free to play games that I'm extremely competitive in and want to get better and want to be able to show that I've gotten better through my rank increasing.
00:09:08:16 - 00:09:32:07
Philip Collins
And I think that's probably at the core of this conversation with with Counter-Strike is the cosmetics bring people back. But the reason that their attention is still even engaged is because of this competitive loop of of progression and improvement on the organized sport side, It's a little more difficult because obviously publishers benefit, right? E-sports, at the end of the day is effectively marketing for these games.
00:09:32:18 - 00:09:58:16
Philip Collins
It is the next level of achievement and progression for for an average player like me where I'm not only trying to get to the top rank, I'm trying to potentially get this to be a livelihood if I'm a if I'm a teenager or whatnot. And so it's increasing the stakes of my progression. And that is very compelling to players and to publishers who can really monetize that and capture the value of those users over long periods of time.
00:09:59:02 - 00:10:25:05
Philip Collins
I think I struggle on the more like organized sport side is the fact that you are in many cases with franchising, paying in to be the marketable asset. You're really capturing eyeballs on an asset that isn't yours. And at the end of the day, from a scalability perspective, even if you're driving $50 million a year in revenue off of off of that attention, it's like how big does it actually get?
00:10:25:05 - 00:10:40:18
Philip Collins
And so I've struggled to see, like as a as a venture investor, the scalable opportunity to invest in like an organization. But I definitely see the value of the competition that those organizations are fostering for the games themselves.
00:10:40:18 - 00:10:41:09
Nico Vereecke
Your thoughts? Hmm.
00:10:42:15 - 00:11:06:07
Tim Cotten
Well, I've got two thoughts, especially in regards to CSGO, right? Just as Phil was saying, what we're really talking about is that there is a game loop there that is very simple and very different from Overwatch and I speak from I'm a big Overwatch fan. I have survived too, right? I love to play. Oh, W2 is my like, like my daily 1015 minute fix.
00:11:06:07 - 00:11:28:01
Tim Cotten
That's that's where I can just sink some time and not worry about things. But yeah, you said it. Watching the league is painful because Overwatch tries to be many game modes all at the same time. So yes, Go has a straightforward model. You know, you've got you've you go five by five, you die. You keep going until the mission is done.
00:11:28:01 - 00:11:49:06
Tim Cotten
That's watchable. You know, there's a sense of stake there when you're responding in another game. You're really just hoping for the the the anticipation of conflict again and again and again. And like Niko was saying, people are dancing around the map. It's all kind of hard to actually pay attention to. Not that it doesn't have its fun moments, but what what Cisco does so well.
00:11:49:09 - 00:12:17:11
Tim Cotten
Right. Is that because of that simplified game mode, it can have a much larger metagame. And as Phil was saying, like that causes this entire ecosystem of e-sports where you have every incentive, just like real life college sports or major, major national brands, you've even got cheaters that take it to the next level, right? I mean, back in 2020, like 40 coaches got banned out of CSGO for streams tonight for playing because they had a cool camera hack that they were abusing.
00:12:17:11 - 00:12:40:23
Tim Cotten
Right. So what you end up with in these systems is if it's worth money, if it is monetizable, some of them will find a way to get that money right. And that's a natural human trait. So I applaud Cisco for having such a strong design that it can not just last for ten years, but it can keep growing interest as the, you know, population of youth.
00:12:40:23 - 00:12:41:10
Tim Cotten
Scales.
00:12:42:08 - 00:13:05:10
Philip Collins
Yeah, well, it's actually interesting too, about the game design is that it's almost contrary in many cases to what we see today, focusing on social interactions and network effects of friend groups where a lot of these competitive focus games are actually quite limiting in terms of the social dynamics because, you know, if you're if you're a certain rank and your friends are three tiers below you, you actually can't really play together in the modes that you care the most about.
00:13:05:18 - 00:13:28:22
Philip Collins
And so it almost becomes inherently unsocial from a friend group perspective. And it really is that retention really does feel primarily driven from the game and your desire to improve as an individual in a lot of cases because you know, you're not hopping on to play with all your best friends that are are very different in skill levels.
00:13:28:22 - 00:13:29:10
Nico Vereecke
Yeah, that's a.
00:13:29:13 - 00:13:32:13
Tim Cotten
Really interesting insight. Good. Sorry. Go ahead, Nicco.
00:13:33:20 - 00:13:39:15
Nico Vereecke
Though, I was going to ask Phil, have you guys invested in anything around toxicity in games?
00:13:40:11 - 00:14:04:12
Philip Collins
You know, we haven't we haven't directly. We invested in an anti-cheat solution for way back in the first fund. But I think the way we've been looking at toxicity, which is certainly prevalent in competitive games, that's probably where it gets as bad as it can be. We've been trying to debate the approach that we feel strongest about because it feels like there's there's two kind of angles you can come at it from.
00:14:04:19 - 00:14:32:06
Philip Collins
One is punitive. And when I think of punitive, I think of more voice moderation tools where something bad is said and then that player is correctly punished because of the action that they've taken. And then the other side is preventative. And we've seen a lot of people trying to do, you know, universal gaming IDs that go across games and you're building up your social equity by having this kind of KYC profile that really does represent you and only you in the gaming world.
00:14:33:04 - 00:14:53:23
Philip Collins
And by having that social equity hanging over the player, you're discouraging that behavior because that damages you as a as an individual or as a profile. And I think we've seen interesting cases of both of them, but we haven't we haven't directly invested in anything that falls into one of those two categories.
00:14:53:23 - 00:14:59:11
Nico Vereecke
Tim, you're smiling. Sorry. Tim was smiling so much. So I don't know. I don't know what was going on. He said he.
00:14:59:11 - 00:15:20:06
Tim Cotten
Said, you know, it's it's funny to me because this problem is as old as time itself. Right at the moment. We hooked people up to each other grief and started happening. Scams started happening, terrible things on voice on. It's funny because I might actually have a role to play here, right? Because if you look at content moderation tools, right?
00:15:20:06 - 00:15:39:09
Tim Cotten
My favorite are like text channel chats, right? Where people are spamming something truly abhorrent. Right? Let's just say like some terrible like racial slur or something. Inevitably you know, all these words get added to the naive filters. And, you know, people come up with replacements for them, like in overwatch, where it just says, I'm trying real hard to be a better person.
00:15:39:17 - 00:16:01:01
Tim Cotten
Right. But instead of whatever they had originally said, but then someone figures out, Hey, I can just spam a couple of separate lines and make a swastika with it with emojis, and then the content filters like, Oh, that's fine. And yet if you had a AI that was trained to not look at the input of the text, but actually look at the render of the text.
00:16:01:01 - 00:16:16:07
Tim Cotten
Right. And say, Hey, that looks real familiar, That might be an interesting application for a tool content moderation tool that really helps out with the future of toxicity voices. It's own problem.
00:16:16:07 - 00:16:46:14
Nico Vereecke
Yeah, I am an interesting approach there because you're right, Phil, it feels like one is punitive and the other one is is kind of preventative. But even more interesting, I found the most wholesome approach was League of Legends, who basically had a sort of like, it's like a reward system. At the end of the rematch, you could like, I know what the term, I'm blanking on the term, but you could like, you know, give a thumbs up to one specific player because of, you know, friendliness, steam player, etc., etc..
00:16:46:14 - 00:17:23:10
Nico Vereecke
And that's that's a yeah, exactly. An endorsement. And I think those if you got a few of those, you get like, you know, cosmetic benefits, which brings us to the start of this conversation, which is an interesting approach, obviously doesn't fix anything, but I think a a like moving forward, I do feel like I think there's there's there's a place for a sort of gaming, like a decentralized identifier that you carry across because in the end, as a good player, nontoxic player, there's no reason why you wouldn't want to use it, I feel like.
00:17:23:13 - 00:17:26:13
Nico Vereecke
Or is that or am I being too, too centralized about this?
00:17:27:10 - 00:17:52:04
Tim Cotten
Well, I'll just give my $0.02 there. So Vitalik Buterin. You know, he's working on soul bound tokens, right? They've put together the, the draft for that and that's one of the many use cases that you would have for such a system, right. If you can force someone's digital identity to have soul bound reputation, then you are achieving kind of what you were all talking about in the metaverse.
00:17:52:04 - 00:18:18:09
Tim Cotten
I know the World Wide Web Consortium has thought about that. They've talked about if we're going to have ID systems, we should have a decentralized ID system so that it's in the player with the person's hands to create their own identity and expose as much of that as they want to these various products and platforms. Right? That way you could have an alias under it that absolutely was tagged as the toxic slug who was just terrible, but the base reputation probably wasn't.
00:18:18:09 - 00:18:34:00
Tim Cotten
And then you can make another alias that also had a beautiful, shining, angelic reputation, right, Because people put on masks. And that's one of the biggest things with the whole concept that you're talking about is that people do wear masks when they play games, when they interact in different virtual worlds.
00:18:34:14 - 00:18:59:03
Philip Collins
Hmm. Yeah, good. And I mean, our platforms are designed around that too. Like discord is literally created so that you can wear a different mask in every server. There's no centralized identity and I think the challenge here is going to be the same thing we talk about every single time we discuss interoperability. Are these different publishers going to be okay with an identifier going from riot to take to the EAA to Activision Blizzard?
00:18:59:03 - 00:19:11:12
Philip Collins
And that's a that's its own hurdle. But I think there's a value in that when it works. But I think the the ability to actually get that to work is where the where the real struggle is.
00:19:12:04 - 00:19:32:08
Tim Cotten
Yeah, you have to you have to make it have value to all the parties. Otherwise, No. Because then it's just competition for competition sake. Right. It's like open opensea and blur. You know, you, you've got people like taking shots across the bow on a totally different concept, but really is the way that the royalties are being handled any different from this conversation really?
00:19:32:08 - 00:19:35:13
Tim Cotten
You know.
00:19:35:13 - 00:19:49:07
Nico Vereecke
Talk about Opensea and Blur. Let's talk about Nfts and the next iteration of and if these because this is truly what Tim has been waiting for to talk about this. Tim give you give us your thoughts or give us some context first.
00:19:49:23 - 00:20:00:00
Tim Cotten
Now let me ask you this. What do you guys consider to be like the current state? The version of one, if you will, of NFT is what are we seeing right now? What is version one? If we're going to like put a pen on it, just say we're done.
00:20:01:12 - 00:20:24:13
Nico Vereecke
So in my head, the current version of Nfts is essentially the ERC 721 standards. That's pretty much like pretty basic. You know, you can own NFT, you can sell an NFT, you can transfer it and that's you can burn its rights, which is a form of transferring, and that's pretty much it. That's for me with the current state of it.
00:20:24:13 - 00:20:30:02
Nico Vereecke
If Jesus and I guess what I would say, 99% of NFT are okay.
00:20:31:01 - 00:20:55:16
Philip Collins
I think I agree. Yeah, yeah. I think I'd have just about the same view. When I think of current nfts, I think of immutable ownership from a token ID perspective, but not necessarily immutability of the asset itself in terms of changing metadata. And so it's almost like you own, you own this specific thing, but the thing is not necessarily particularly well defined from a, from a sense of permanence.
00:20:56:04 - 00:21:24:04
Tim Cotten
Yeah, I guess. Yeah. So the second follow up to that, since we're talking about 7 to 1 in 1155, no to do NFT is require a blockchain to be an NFT, right. There's my philosophical question. So to me, no, because the whole idea is exactly what Phil said, right? It is a unique identifier for some sort of target data.
00:21:24:13 - 00:21:57:15
Tim Cotten
Right? And there are other ways to enforce that besides a blockchain. I mean, Molly White wrote about this on her blog and she runs the Web3 is going just great dot com, right? And so she's always the most scientifically skeptical of of groups, but she she pointed out that if artists really want an NFT without going through a blockchain, they can absolutely just sign digital signatures and have a chain write a chain of digital signatures that show that the original author have created it, that it was traded, and you don't need a blockchain for that At the end point.
00:21:57:15 - 00:22:28:01
Tim Cotten
You can just prove it. But you know, the response I think that we would hopefully have from Web3 more enthusiastic point is that there are things that blockchain technology gives us that just a sequence of digital signatures by itself does not. Right? And so I've had that conversation with other game developers. Obviously, you know, in the industry, most take a dim view of blockchain because there is very little the blockchain can do that.
00:22:28:01 - 00:23:01:05
Tim Cotten
A centralized database owned by the publisher itself can't, right? On the other hand, there are I've had this conversation too. I am in a bar crawl. What can the blockchain do differently? One, it can provide you provable fairness. You can have a trustless system, right? That is different. I've worked at companies where we have a virtual world product or a game and employees of embezzled digital assets out of it that's really just straight up stolen them, generated them and sold them on the real money market to make some extra cash on the side.
00:23:01:05 - 00:23:19:07
Tim Cotten
Right. Which wrecks your economy. For the other players, it reduces trust in your economy. So blockchain, maybe there is an application there. I'm not saying that I know exactly what the application is, but I'm saying that if you could have a trust list system between player and publisher, that might be of value. And the second thing is scarcity, right?
00:23:19:07 - 00:23:42:07
Tim Cotten
I think I've heard you guys in forecasts talk about scarcity quite a bit and an NFT in the way that Molly White describes the digital signatures would not be able to enforce scarcity of the underlying asset. With blockchain, you can with the I.R.S. 7 to 1, you can along with all the other things you mentioned. So yes, I'm with you on version one, right?
00:23:42:14 - 00:24:02:11
Tim Cotten
Being defined in the way you've said it, it is a tradable item. It can be burned, but equally I don't believe it needs to be on the blockchain. However, people have some really interesting ways to do NFT is that I wasn't anticipating, right? Look at what bitcoin and if teaser are coming out with ordinal now. Right? So now that you know.
00:24:03:05 - 00:24:10:02
Nico Vereecke
I'd love to have your three minute explanation on bitcoin, the okay.
00:24:10:13 - 00:24:34:11
Tim Cotten
I'm going to try to ELI5 this. Yes. As I'm still still learning myself. So bear with me in mind right. Bitcoin has the ability since early 2023 to include more data in the message that you go. Alonzo goes along with the transaction right? So there is a publish system now called ordinal so that you can relate a given.
00:24:35:01 - 00:24:57:19
Tim Cotten
And I'm going to I'm going to I'm going to say two things. I'm the first is that you can just publish NFT metadata into Bitcoin's transaction message history. Okay. How does that get linked to an ID? Well, someone figured out that every kind of a way to number each Satoshi, you know, which is the smallest smallest unit of Bitcoin, right?
00:24:58:02 - 00:25:24:14
Tim Cotten
Each Satoshi individually. So you can essentially trade a Satoshi that has an index number, which is interesting because of the way Bitcoin is structured and that links to the metadata that was inscribed, the inscription system inscribed at the time. And there's methods for updating and stuff. There's some black magic witchcraft happening there, right? There's some there's some ideas about how how these satoshis are truly numbered.
00:25:24:14 - 00:25:46:10
Tim Cotten
And does it need a secondary system to track them and make exposure to users in the same way that a wallet or metamask does? Right. So to me it's like just a natural consequence of what BSD like Bitcoin Satoshi vision was kind of doing by adding the terrain language back in right where they were doing nfts and other things.
00:25:46:10 - 00:26:08:11
Tim Cotten
Already in Bitcoin, it's like, well set inscription and let's, let's do something along those lines, right? So I think it's an interesting system. I'm very kind of curious to follow along with some of the upcoming releases. Right. They look very like very interesting artwork, but I'm sure you could do more than just artwork with them.
00:26:08:11 - 00:26:36:11
Nico Vereecke
I appreciate that. So if I kind of try to explain it back to you as I understood it, you can make it Bitcoin transaction, a tiny Bitcoin transaction, and where in the text you referred to a individual Satoshi with metadata and from that moment that individual Satoshi is linked to that metadata and the owner of that individual Satoshi owns the NFT that is represented by that metadata.
00:26:37:04 - 00:26:55:14
Tim Cotten
Okay, very. I think that's as close as we can come. Without getting pedantic, I'll just say the one thing is that the transaction itself represents like a Satoshi, right? Being traded. It's like a certain amount of Bitcoin moving and that's the link to the metadata. Okay. Again, this is based on a platform called ordinal using the inscription system.
00:26:55:14 - 00:27:02:16
Tim Cotten
So there's still kind of like that separation. It's not like a fully native Bitcoin thing. It's as needed as you can get with Bitcoin.
00:27:03:11 - 00:27:27:05
Nico Vereecke
And so, Tim, what do you think is why is this interesting? You mentioned like interesting art, which is something that I'm not specifically interested in, but I'm more interested in understanding like why this is cool from a technical point of view, how this differs from what we know today, the NFT that exists today. Before we go into like the upgrade of the NFT that we that we have today.
00:27:27:05 - 00:27:28:12
Tim Cotten
I feel like I'm going to break your heart then.
00:27:30:00 - 00:27:31:09
Nico Vereecke
I'm really I'm really sorry.
00:27:31:14 - 00:27:58:03
Tim Cotten
It's not really different now. It's just it's taking a concept that has existed naturally that we thought was smart contract necessary. Right. And saying songs, you have a pointer system, you're good and that's all it is. A pointer system. And I think I've talked to you guys before about stuff I'm working on where I also have a pointer system and it also doesn't require this stuff and still can be instantiated later on the blockchain.
00:27:58:03 - 00:28:10:20
Tim Cotten
So it's neat. I absolutely think it's neat and I think it will absolutely take a lot of Bitcoin attention for, say, the next two quarters. I think you're going to see a nice little uptick in Bitcoin NFT interest.
00:28:12:18 - 00:28:15:15
Nico Vereecke
Yeah, and that's it.
00:28:15:15 - 00:28:15:20
Tim Cotten
Yeah.
00:28:16:21 - 00:28:38:10
Nico Vereecke
Yeah. Makes sense. It's I saw that Google Apps was now launching in a collection there. Of course they are because they got to milk their brand as much as they can so that doesn't surprise me at all. But as far as like from the understanding that I had was this is as you described, it needs something interesting without like a true, true game changing use case.
00:28:38:23 - 00:28:55:06
Tim Cotten
Well, and see, I don't want to be like a total Debbie Downer, right? I don't want to say like, oh, there's no real use case, but it's just it's an augmented case that already exists. We're not seeing something particularly new. I mean, like if I want to go do this on Bitcoin right now, I think we all understand it's going to cost me about $50 to instantiate that.
00:28:55:06 - 00:29:11:15
Tim Cotten
NFT Right. That's that's not getting things in the hands of more users. That's just another I hate to call it a toy, but it's another rich people's toy to play with right now. Yeah, we're not moving closer to like more people accessing it.
00:29:13:04 - 00:29:20:22
Nico Vereecke
Yeah. Good. Back to the the NFT we know and that.
00:29:20:22 - 00:29:47:23
Tim Cotten
So we were talking about like okay we got, we kind of covered version one and then it's kind of like what, what does version two look like? Right? So we talked about Bitcoin Nfts probably aren't version two, right? I am very interested in NFT is that and I know this is the mission of fog now in general, but are not skeuomorphic that are not just reflecting real world ideas that are doing something interesting that we may find a future application for.
00:29:47:23 - 00:30:11:23
Tim Cotten
Maybe we don't know what it is yet, but for the metaverse, right? I have a lot of game designer friends, colleagues who pretty much just say, Hey, and this is reasonable is a completely reasonable reaction. There is there is no such thing as item portability in the metaverse. It's all a pipe dream, right? Because if gaming has to respect all of game P's digital assets and then they introduce game, see over here.
00:30:11:23 - 00:30:33:05
Tim Cotten
Well now you've got it's not it's a component talk nightmare right And the great the great hope of like blockchain technology in these games is that maybe we can find common ground somewhere. I know that there is a game developer right now working on a common language for declaring digital assets in the metaverse, right? He's working on every possible tag x email style kind of thing that you could want to describe.
00:30:33:05 - 00:31:01:02
Tim Cotten
An NFT. Is that the right direction to go? I don't know. I really don't. I think there are better things to be said about NFT is being able to lock in value in a virtual economy, right where we kind of go back towards the simulation of these these worlds, these platforms less than the or would you call it the the pump and dump hype scam?
00:31:01:02 - 00:31:22:01
Tim Cotten
Right. Because right now this is really funny. I was looking I had I had on my big screen right at my and my other office. I had it on the big screen. I had this like chart of like all the NFT adoptions for all some very big projects and very famous projects that are either still successful or have failed and all of their curves looked virtually identical.
00:31:22:12 - 00:31:43:22
Tim Cotten
And the director of one of the directors at George Mason University, who's in charge of the Virginia Serious Game Institute, he walked by and as James James Casey, who worked with me at Mythic, and he goes, Huh, That was really familiar. And I didn't have it labeled as NFT data. You just didn't didn't know what it was. And so now looks a lot like the product adoption curve in business.
00:31:44:10 - 00:32:13:02
Tim Cotten
I was like, Oh, it is all these deflationary fixed supply NFT Nfts just follow the product adoption curve bar, maybe a couple, right? Like bullets that can just demand that country club style adoption, everything else like Cycle crash. It's not even just a lack of utility. It's the way we think about NFT as having to have value because they have a finite supply.
00:32:13:12 - 00:32:17:15
Tim Cotten
I think that's a root cause of version one failures or disinterest at least.
00:32:18:23 - 00:32:33:05
Nico Vereecke
Could you elaborate on the adoption curve? Because in my head it's like this S-curve where you have early adopters and then more and more people and then the late adopters. But in terms of accumulated, they goes towards 100% as everyone adopted, right?
00:32:33:05 - 00:32:57:13
Tim Cotten
So you're thinking you're thinking of the product adoption curve, right. As a logistical function. Yes, that's right. That's totally reasonable. When you look at the actual usage. Right. The usage, that curve looks like that, right. When you when you actually track it against use and like look. And that's no different than, say, a movie release, right. Movie comes out to 222222, four.
00:32:57:13 - 00:33:04:01
Tim Cotten
Wow. Everyone's watching it. You get another bump, you know, the bump and then trails off DVD sales or, you know, streaming services.
00:33:04:01 - 00:33:06:08
Nico Vereecke
Yeah, same with games. Probably.
00:33:06:08 - 00:33:16:07
Tim Cotten
Right. And games are a lot like that. Notice, though, online games have the potential to do different curves, right? So CSGO now it's.
00:33:16:09 - 00:33:17:07
Nico Vereecke
It's still going.
00:33:17:07 - 00:33:34:04
Tim Cotten
Up in a nice little linear track right. So what you that's where I want to see version two and a TS go right? I want to see adoption that moves more in a linear acceleration, right? Instead of like a massive exponential and then a fall. I want to see growth. Yeah, that's, that's what I want to see.
00:33:34:19 - 00:33:58:12
Nico Vereecke
And it feels to me like the, the whole adoption curve were this huge spike. And then this crash is almost always purely like the reason it looks like that is, is less I feel like because it resembles adoption curves and more because it resembles booms and busts from the stock markets where people start speculating. And there's this this vicious cycle of people like the prices going up it people like, holy shit, I'm missing out.
00:33:58:12 - 00:34:11:06
Nico Vereecke
So I'm jumping out of bed. And so yeah. And I guess my question is like, okay, how do we turn it into the forever game style curve where it just keeps going up? What's, what's your solution to Where do I go? Tell me.
00:34:11:07 - 00:34:28:11
Tim Cotten
I've got a theory, right? I've got a theory, and I'm not going to take the straight out of virtual world game design, right? So I'm. I'm probably just going to be You've already done interviews with people like Raph Koster and others, so I'm just going to pare back some very important game learnings over the last 20 years, and that is fixed supplies don't work, right?
00:34:28:12 - 00:34:48:23
Tim Cotten
They just don't work long term. We know that any any kind of digital asset that has any utility at all, if there's a fixed supply of them, it's going to end up being a feudal system of early adopters who massively take over the market and then gatekeeper for the new users. Right? And then you've got people there's no incentive not to flip.
00:34:49:06 - 00:35:14:21
Tim Cotten
That's essentially all the activity becomes right? So I will say that and I get I'm going to call back to hold my line, because that's a that's a fun use case. And there's a nice research paper you guys can look up on it. They did try to fixed supply, right, right at the beginning of the game with resources like chopping down trees, like you had to like use the wood or burn the wood, and then it'll go back into the resource pool and make another tree.
00:35:14:21 - 00:35:37:14
Tim Cotten
Right. And of course, the players burn through that in like days. It didn't work right, so they had to shut that off. Now, the interesting thing is they took the next lesson and said, okay, well, we have to have a faucet, we have to create things dynamically, but we should add some drains in the economy and encourage players to like just pull these things out because players will hoard things.
00:35:37:14 - 00:35:52:05
Tim Cotten
You know, if you have an open economy, you're going to get two activities. You're gonna get hoarding and people are going to forget about it, or you're going to get like people who want like piles of crud that they want to get rid of. What do you do? You do turn in events, you have ways to use it.
00:35:52:05 - 00:36:23:02
Tim Cotten
You smelt things together and give them better upgrades, right? There is an entire set of game mechanics taken from roleplaying games that we can apply to Nfts Version two and they don't even have to be role playing games. But the mechanics or sound right, those things can belong in nfts that are more open ended, where instead of saying, Hey, I'm going to go ahead and pre-print ten pieces of hair times, ten pieces of clothes, times ten eyeballs, ten times ten faces, and make 10,000 generative, you know, art pieces.
00:36:23:16 - 00:36:45:01
Tim Cotten
No, I'm going to I'm going to make an NFT that uses dice rolling mechanics, and maybe it's more like a DNA character where, you know, you have a chance to roll certain attributes, mostly on average, right? Mostly in the bell curve. But, you know, if you go ahead and say, I want the best of the best starting point, you sit there and you iterate over the possibilities space.
00:36:45:04 - 00:37:04:05
Tim Cotten
And in this case, I'm really talking about like a number that goes to a random number generator and generates attributes, right? That's what I'm really talking about. So if if you set the probability table to be like one in a million gives you a plus one on the stat and people are going to sit there and iterate over the possibilities.
00:37:05:03 - 00:37:34:13
Tim Cotten
And what have we learned from Bitcoin and Ethereum? Numbers are big, like the basic unit in theory, and then bitcoin is a 256 bit integer, right unsigned integer. The number itself, when expressed from zero to that number is unfathomable. It might as well be infinity. It's not infinity. I know that, but it might as well be because we don't have enough atoms in the universe to build computers that could iterate over that field fast enough.
00:37:35:06 - 00:37:54:22
Tim Cotten
You could throw all the hash power in the world at it and it's not going to make a dent. So that gives you a huge possibility space to play with, with very accessible technology that we have today. You could absolutely make enough keys like that. I'm going to make enough deals like that. By the way, and then we can put, you know, some very interesting mechanics on top of it and turn them into games.
00:37:55:05 - 00:38:05:17
Tim Cotten
Right. But I think there are ways to do NFT is that are not just generative art. That's where I'm going with this.
00:38:05:17 - 00:38:24:02
Nico Vereecke
Yeah, I think that makes sense. And so as far as I understand you, you think that in the vast majority of cases and if those with a fixed supply and utility will be detrimental to the success of any game in which they can be used?
00:38:24:17 - 00:38:46:12
Tim Cotten
Yeah, that's, that's my theory based on, you know, what we've seen out of virtual worlds over the last two decades. Right. And again, it doesn't matter how much utility you add to it, the very notion that is if the economy is only a fixed supply. Right. I think long term, it's going to have serious problems. Now, again, if you know you're getting into it like that, okay, that's fine.
00:38:46:16 - 00:39:07:13
Tim Cotten
Right? Board apes knows that it's a country club. It's literally called the Board Yacht Club. It is literally a country club that's real life concept. People have country clubs where there's only a thousand members, Right. And they have to trade those memberships. Fine. But as far as making fun games around it and including lots of people, well, okay, that's a very different thing.
00:39:07:13 - 00:39:11:01
Philip Collins
Yeah. Wise to both fungible and nonfungible tokens in your mind, right?
00:39:11:15 - 00:39:36:07
Tim Cotten
I agree. And here's what's weird about here's what's weird about Bitcoin, right? Whenever I talk to bitcoin crypto pros, right? Or bitcoin max is of like, hey, it is awesome because it is, it is a deflationary currency. I was like, but it's not right now. It is not a deflationary currency. It is inflationary. Right now the rate at which it's inflating is deflation is disinflationary, right?
00:39:36:07 - 00:39:58:14
Tim Cotten
It cuts itself over time, but there's still enough new stuff being added to the market. The total economy that we haven't hit, the point where the reward value, the Bitcoin reward for block has like kind of hit that weird point where minor transactions really are more important, right? So we don't know what's going to happen when when Bitcoin gets to that point.
00:39:58:14 - 00:40:25:15
Tim Cotten
We don't know if the how things will have like killed interest in Bitcoin like 50 years from now. We don't know. But I do know that Bitcoin can succeed right now because it just acts like an inflationary currency right there and does too. Don't get me wrong, there are other there are other interesting currencies that are completely deflationary and maybe they have a lot of market value.
00:40:26:07 - 00:40:36:16
Tim Cotten
I don't know. But yeah, Bitcoin, I would never call it deflationary right now. It's intended to be deflationary. That's where I'm going with that.
00:40:36:16 - 00:41:02:08
Nico Vereecke
Yeah, it's it's interesting. I feel like we can probably do a whole other discussion on bitcoin, whether it makes sense and also the types of tokens. Because if you go back in our Economics to Economics channel, you'll see a heat heated debate about inflationary currencies and whether they make sense in games. So if it's not inflationary but also not deflationary, Tim, what's it going to be?
00:41:02:08 - 00:41:04:10
Nico Vereecke
Man It's going to be all stablecoins.
00:41:05:00 - 00:41:29:07
Tim Cotten
Yeah, I've heard a lot of people, even in our flooded channels, right, talking about various options, like maybe we need multi token approaches where you've got a deflationary currency and an inflationary currency side by side with it. Right? I'm going to try something interesting where I have an inflationary like NFT mining system, but it's like a dual token economy, right?
00:41:29:08 - 00:41:53:15
Tim Cotten
So one side is like the power ups, but they decay if you don't use them. So they come with like actual expiration dates. If they're more rare, they last longer, which means they could be traded. But otherwise it just incentivizes people to use the things in the game with the other NFT as they're intended. Right. And I really think this idea of exploring expiration of Nfts is interesting, right?
00:41:54:02 - 00:42:16:19
Tim Cotten
Not just on its own merits of like just being an interesting idea, but I think it makes sense, right? If you want to encourage people to spend time and resources doing an activity and they have enough to reward from some activity and it has to be used like within the next couple of days or a week or something before it's gone, or then it gets used, right?
00:42:16:19 - 00:42:31:23
Tim Cotten
And then you have this like a cycle that you can work with. It's I strongly feel it's worth, even though it's incredibly hard to model because all the economic companies I talk to are like, Oh, we don't know what to do with that.
00:42:31:23 - 00:42:53:13
Nico Vereecke
Yeah, I would say that's my my thinking around this right now is I'm fully aligned with you that well, let's put it this way. I think we all three of us here agree. And if you're listening to this, I think you'll agree as well, is that the current state of if these four games is is a bit stale and I don't think it's it's it's productive at this point.
00:42:53:15 - 00:43:33:16
Nico Vereecke
I think, you know if you're doing another 10,000 drop, especially if it has utility in your game probably going to have a bad time. And unless you have a very good marketing department and then you can ride the whole wave. So I guess what I'm rooting for, Tim, is, you know, examples like your randomly generated and if those that are like, you know, based on the numbers that you mentioned or experiences, I think depending on the game, just, you know, I feel like in the end, I think game developers have always been pretty creative terms of assets in digital assets, right?
00:43:34:22 - 00:43:59:04
Tim Cotten
Absolutely. And incredibly so. And that's what that's what drives a stake through my heart, right? When I see the current climate and you call this out, right, people will drop a 10,000 NFT collection because while they have an underlying currency utility token underneath that, they want to take from 0.0000 $0.01 par value to a dollar somehow one day, because then that makes them filthy, filthy rich.
00:43:59:10 - 00:44:29:03
Tim Cotten
It doesn't make the game any better, right? So it's just people chasing investments. Can we use that creativity from the game industry? All the lessons? Look, Bartle Caster, even Keith Bergen, right. He's got amazing strategy, game design stuff. How can we not, like, take all of these amazing lessons right over the last three or four decades and turn that into things that we would want to show our spouses or show our children and feel good about them playing with, Right?
00:44:29:08 - 00:44:35:06
Tim Cotten
Yeah. And that right now I'm not there with Web3 yet, even though I'm a huge Web3. I love it.
00:44:35:19 - 00:45:00:17
Philip Collins
Yeah. And I think that the thing that always confuses me about Web3 sometimes is how backwards it is when we think about like V1 of of NFT and V2 of NFT, I almost think of it as simple as moving from pure speculation due to a lack of actual functional value to having functional value that then drives the prices and you know, maybe there's speculation on top of that.
00:45:01:01 - 00:45:21:01
Philip Collins
But today but today it's like with fungible tokens and nfts are like game. Game studios are almost trying to drive value towards their game from the theoretical value that's created from their hype where, you know, if you have a fungible token, like, honestly, like an alluvium call it, you have a multi-billion dollar fully market cap with nothing to show for it.
00:45:21:01 - 00:45:35:05
Philip Collins
In terms of the game, you're trying to drive hype and attention and the user base to your game from from pure speculation in terms of what be there one day and yeah you know it is it is kind of completely backwards in that regard.
00:45:35:05 - 00:45:54:23
Tim Cotten
Yeah it's so it's so ironic you say that because even I fell into that trap early on. Right. Like I was even a couple of months ago, I was fully convinced that in order for me to prove the utility and neatness of this, like new any any new NFT experiment, we needed to make future games against those. NFT is right.
00:45:55:04 - 00:46:17:15
Tim Cotten
Instead of taking all those game lessons, those game design lessons and knowledge. Heck, I remember when the gamification craze was a thing I have. I have a certification for that. And taking all of that, putting those in the NFT is making the NFT their own experiences, right? Okay, that's cool. Trying to say, Hey, we're going to make this cool NFT and in two years there's going to be an amazing game to play with it.
00:46:17:15 - 00:46:21:05
Tim Cotten
Yeah, right. D.O.A. I don't think there's any future in that any more.
00:46:21:05 - 00:46:36:12
Nico Vereecke
Yeah, the greed. Good. All right. Um, yeah. I mean, if you listen to this, I hope you, um, you're inspired to do something. Don't do it. Tim does, because that's what teams do. Something is, you know, creative.
00:46:36:13 - 00:46:41:06
Tim Cotten
I've got a really boring paper, so don't worry, you guys can follow it. Once was clear of it.
00:46:41:14 - 00:46:44:15
Nico Vereecke
Yeah. If you. If you want to fall asleep. Asked him for his paper.
00:46:44:21 - 00:46:52:11
Tim Cotten
Oh, my God. I actually reference that in the pitch deck as I'm going to take this boring paper and turn it into something fun. See? Boring picture. Nice picture. Yeah.
00:46:53:18 - 00:46:58:11
Nico Vereecke
Good. All right, Tim, thank you so much for joining. They've gotten scripted. Where can people find you?
00:46:59:17 - 00:47:21:20
Tim Cotten
You can find me at Twitter. Cotton IO right now. You can find me at my blog. Literally blocked cotton. Daddio. Here's the only thing. My last name is spelled Scotty T in God knows Why. Oh, wait. No, I know Because a doctor messed up on my grandfather's name, and he had 12 brothers and sisters named Scotty on how.
00:47:21:20 - 00:47:22:18
Tim Cotten
How do you lose the one?
00:47:23:21 - 00:47:29:08
Nico Vereecke
Funny. Good. All right, Tim Cotton and Phil, where can people find you?
00:47:30:17 - 00:47:41:18
Philip Collins
I've minimal social media presence, as Nico knows, but I do Twitter infrequently. Honestly, this is probably the best place to find me. I do. At Phillip Island. Collins Telegram Twitter.
00:47:41:18 - 00:47:47:08
Nico Vereecke
Our LinkedIn man. You were doing like blockchain gaming updates. These are those. I don't see this anymore.
00:47:47:12 - 00:48:09:19
Philip Collins
I start doing the weekly updates when I felt like the weekly update started too redundant. For a while there, it was like somebody released the new token big company, put in a small fire checking into their game studio, and eventually I was like, Man, this is getting really repetitive. And so, you know, me stopping doing those hasn't been from a lack of interest and conviction in this space.
00:48:09:19 - 00:48:14:15
Philip Collins
I just think that after a while I was like, Man, this is the same thing over and over and over. It's fair.
00:48:14:22 - 00:48:15:10
Tim Cotten
It's very.
00:48:16:01 - 00:48:25:11
Nico Vereecke
Good. And then obviously, best way to chat with these gentlemen is join us in the discord. Yes. Most importantly, that's that's where you get most out of them for sure.
00:48:26:13 - 00:48:27:15
Tim Cotten
And you guys, too.
00:48:27:19 - 00:48:43:17
Nico Vereecke
And us. Yeah, we're active as well as very. If you like this, please let us know. You can, like, subscribe for all the good stuff, even on the podcast. That's very much appreciated. Join us in the discourse. And with that, we're out and we look forward to speaking to you in the next episode.
00:48:43:17 - 00:48:58:15
Intervenant 4