📺 AMA with Devin Finzer of OpenSea

are here who is the co-founder of openc and david the topic is the nfts because nfts are absolutely blowing up right now uh talk about nfts what's going on in this world right now david uh sorry to kill you offline didn't go live uh so we are doing it right now now start over okay all right bankless nation we are super excited to bring you this community ask me anything this is your opportunity to ask our guest question we are streaming this live on youtube we usually do this

on the second and fourth wednesday of the month this time it's thursday but next time it will be the fourth wednesday of march so check it out you can also get it on the podcast the day after i'm super excited about our guest today because the subject is topical the subject is absolutely blowing up we're talking about nfts today and there's so much going on in the nft world we've got an absolute expert this is devin finster who is the co-founder of openc david what's going on with nfts why are we bringing on a

guest to talk about nfts yeah people would think that like we are done talking about nfts but like nfts aren't done like maturing or being discovered by people so the surface area for nfts is endless and the the news of this week is that uh rob gronkowski otherwise known as gronk pro football player tight end for i'm not a football person big football player yeah yeah tampa bay um dropped nfts right and so we have now pro sports athletes dropping

nfts people as of this morning sold an nft for 69 million dollars what uh so the rabbit hole just keeps on going uh and so a really important piece of infrastructure for nfts is open c uh which is a place that i use to explore and uh kind of view view my inventory of nfts and also see the inventories of nfts that are out there uh but there's also so much more that it does as well so we got devin on to just ask what what's up with openc and so we're going to bring him on in just a sec

guys start cueing your questions in youtube if you have them we're going to start with some questions from david and myself but we will get to your questions as we see them in youtube before we get to devin start talking about openc start talking about nfts we want to thank the sponsors that made this episode possible synthetics is ethereum's decentralized derivatives liquidity protocol what does that mean synthetics is a platform for creating and trading synthetic assets which are assets that are priced via an oracle rather than bids or asks traders

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groceries at your grocery store or the coffee at your coffee shop go to monolith.xyz to sign up and get your monolith visa card today hey this is devin finster who is the co-founder of open c he's also a non-funchable human that means he is unique cannot be exchanged with any other human being devin how are you doing today i'm doing well thanks for having me on well thanks for coming on are you ready for this bankless ama sir i'm ready all

right any questions guys put them in youtube let's start with this question because devin it really feels like nfts are having their moment nfts are blowing up right now we've got beeple we had three lao on the podcast [Laughter] we had blau on the podcast yesterday sorry not free loud that that's inside joke dave it's that joke just made out yeah dude i got out blau on the podcast rob gronkowski now dropping nfts it really feels like they

are being uh discovered right i mean they've been in crypto for a while but now they're being discovered why are nfts blowing up do you think i think it's a combination of a lot of things i think i think it's hard to point to one specific application and say this was the reason nfts blow up right if you pointed to people you know you could point to top shot you could point to um you know all these different applications that are coming online at roughly the same time um i think a lot of those added fuel to the fire but i

really think that the underlying reason was just the accumulation of a lot of hard work over the last three years from everyone who is involved in the space so if you look at 2017 late 2017 when crypto could use launch um really the only thing you could do in the nft space was you could buy a cryptic kitty you could breed a cryptid you could sell a crypto kitty and that was that was the entire nft space it was really boring from from that project but over the last three years now there's so much more there's nft creation there's nft

marketplaces like ourselves um there's you know uh even brand new blockchains like flow that are devoted specifically to nfts um there's nft indexes there's energy collateralization and all these things are just creating this really cool ecosystem and then you throw some fuel on the fire with things like people selling you know previously for uh four million now for even even more but you throw that on the fire and then you have this rich ecosystem that people can really dive into and you know i think that's just a

recipe for really explosive growth of the space and you know it i think for us from our vantage point it was it was interesting to see because um it you know it was just kind of really slowly growing it was a lot of momentum and excitement from the people who were excited about it but really just contained to that sort of uh early adopter community and now all of a sudden the the curve is just it's insane to see the speed at which these trends evolve in which they go viral right and you're

sort of you're also the other the last thing i would say is that you're building on this foundation of social media where everyone's already hyper connected so these trends can just go you know get broad reach really quickly um through things like twitter and clubhouse and all these different platforms so so on on that note kind of i want to bring this question to the front front of the conversation because uh there's a decent amount of like the core ethereum people the people that have been with ethereum since the bear market right and

they are seeing that growth that you are talking about that parabola that you guys are talking about and saying that this is unsustainable and these prices are absurd and you know flashbacks to the ico mania uh it can't continue like this what would you say to people that are are worried about the sustainable nature of this new movement well i think it's a good point i think there's there's certainly cyclical uh there's cryptocyclical and i think nfts will probably have cyclical uh elements

to them um but i do think that this is a very very different phenomenon from what we we saw with icos with icos you know it was about these sort of projects that had this you know maybe nebulous long-term vision and then it was really about investing and flipping whereas you know there is some of that in the nft space today but a lot of it is around creating curating collecting supporting artists directly it's not about sort of investing in this sort of like hypertherium oh you know a lot of the

icos were legitimate but some of them just weren't and some of them were you know felt really scammy and just not and and you know didn't feel like a good thing for the space in this case i think there's there's certainly you know scenarios where there's you know nfts that are are not worth buying or nfts that feel over inflated um but i really do think that this is the birth of a much more interesting renaissance in um in in creator activity and and and and the design space is just so much wider

than icos that i think we do actually have um you know maybe maybe there's going to be a little bit of a correction but i think we have a long way up as you were saying earlier um there's that so much is underexplored right now whereas icos it kind of felt like at some point you know there wasn't much else to do besides just buy the token and kind of hope it was going up here there's just a lot of richness that i think um uh will will sort of evolve over the next little while yeah one thing that uh i i kind of see in ita in the nft space in contrast to

icos is nfts almost feel devon like they're more honest than icos because with with nfts you know exactly what you're buying you're buying a piece of culture you're buying a meme there's nothing's pretending to be like a utility token that can be turned into money right like we know exactly what we're buying we're buying subjective art pieces basically right and there's no um you know here's our business model there's no like um this is how our tokens going to magically accrue value

or you know kill ethereum or anything like that it's just these are creator communities that are saying here's our nft you can buy it or not and the market is really giving the feedback as far as what what the value of these things are does that resonate with you no i think that's a great that's a great way of framing it and i haven't i haven't heard that sort of uh exact framing but i think um i think that's yeah i i totally agree so the other thing that i'm saying is um and i love that you used uh a few kind of verbs because on bank list we always

talk about like all of the new verbs that we could do in this open money system you use verbs like creating and and curation and collecting right these are very nft these are collectible verbs and um you know i'm somewhat drawn to that but like getting back to kind of the the waves of interest here do you feel like part of this too uh part of the you know what we're seeing in terms of price and these big sales is we're seeing different communities suddenly discover nfts right so maybe we've seen kind of the the beeple

digital art community suddenly discovering nfts and so they fled into the space now maybe we're seeing the beginnings of the professional athlete community right we had mark cuban on who's talking about this but you've got gronk doing something with open c and now that fan base is starting to discover it so is that what's go is that what we're really seeing here and you mentioned that you still see this as as kind of early in its discovery phase is that just because you know we're going to see wave after wave of community kind of discover this

talk to me about that process which communities have discovered this and who do you think is next great question i i think um well if you zoom if you go back in time to even in early 2018 when this was first a thing actually the community they got the most excited about nfts was the gaming community right so cryptokitties was technically a game as a pretty simple game but there was this idea from sort of the fringes of of the gaming community that maybe you could have games that were more like free market economies versus

your traditional game where it's actually quite games are very sophisticated in their uh sort of economic policies and economic structures but they're completely centrally controlled and completely closed you don't have imports exports you don't really you have some entrepreneurial activity but it's kind of looked down upon right um so what if the the idea with the gaming space was like well what if you took these closed economies and you opened them up and you allowed things to move from one game to another game you allowed open markets to exist that was really what captivated a

lot of the attention from from gamers for both gamers and game developers the thing that i think was challenging was that in order to make that work um you know ethereum had a lot of limitations of the user experience you know had a long way to go and then of course what we've seen over the last six months is that gas prices really just made it difficult to support the full range of economic activity from a one dollar item to like a hundred dollar item so gaming um has has done well in certain areas and particularly and kind of maybe we'll talk a little bit about

this but the virtual real estate market projects like the central and crypto voxels in sandbox but for the most part things have shifted towards this more a simpler use case where it's these really high value art pieces and i think a large reason for that is just that the technology that you know that's what the technology can support right now they can support things that are being sold for thousands of dollars but it's hard to support things that are sold for a lot less and i think that will change over time and really enable a broad set of use cases here um in

terms of what communities i think will get involved i think you hit the nail on the head i think it's just community after community after community um and and you know goes beyond just uh you know everything from musicians um artists influencers really there's something to be done here for everyone and there's people who want to support these people who have really had a lot a lot of trouble monetizing in the past and so that's not to say that everyone

every influencer should be able to sell millions of dollars in nfts and not saying that's sustainable but i do think that you know once you have the full spectrum of being able to you know buy an nft for 50 cents for example um you know that's that supporting a creator through purchasing their nft when there's you know the possibility of reselling it in the future is is super exciting and super compelling um and so if it's looking at kind of what i think might come next um i think expanding to just lots of different answers small and

large um and then also expanding to the gaming use case that was sort of the early dream of the space i think will happen with um as the technology kind of gets better devin you alluded to this and i want to go back to this uh about the design space behind nfts and drawing drawing parallels from earlier in history earlier in ethereum history uh we had like this early use case of erc20 tokens which were this many different currencies and this turned into the ico mania that was unsustainable we kind of

figured out that currency wasn't really the best use case for all of these projects but then we innovated and went through a bear market and then we came out with defy tokens and that's kind of like the new paradigm for erc20 tokens and we we often talk on the bankless program about how ethereum is really speed running the history of money and finance as fast as it can like in the last five years we've ran through like 2 000 years of human history of money and finance and now we're kind of our where we are at today uh and i think we could

draw a similar parallel with nfts and art right and what's unique about nfts and and art is like it's a digital token in the back graphic uh digital art in the front but that back end like hooks into financial apparatuses right financial stuff defy is what we call it and so like this this uh software layer that is inherently a software financial layer can be upgraded and innovated on and so that's you know artists are going to work on their art

they're going to innovate on their art and that's going to be what they do and that's going to be independent from ethereum but the nft is also something to innovate and develop and improve upon and so right now you said like we are kind of stuck in this early phase where we just have these high value nfts like that just represent a single piece of digital art and that to me sounds like the early primitives of something much cooler and much bigger down the line where where do you see this first innovation coming like what is going to be the cool new innovation in nfts at least on the financial and software side

that really helps promote this industry and make it sustainable in the same way defy tokens made erc20s uh 20 tokens sustainable interesting yeah i i guess what i would say or one one thing to kind of think about is um and i don't know if this sort of falls into your classification of like the front-end art or the back-end software but um i do think that at the end of the day these assets can represent all sorts of things in the existing digital world or even the real world so for example like right now you

know you have these simple um pieces of digital art that people buy and they're just the provenance is sort of the the main thing about it right the fact that it came from people makes it exciting and compelling and makes people want to spend millions of dollars on it but um there's also just the raw utility of one of these nfts so for example you could imagine um selling event tickets as nfts and those event tickets could be in a real world event or they could be in a virtual event in the gaming space you can sell swords

inside of a video game right um or you could sell courses as nfts or for musicians and creators and influencers you could sell access to exclusive content or access to special privileges um i think there's a whole i think we're starting with just collectibles um but layering utility on top of these things um is going to be really compelling um but i do think that um sort of to what i was saying earlier um i think that in order to have or i think one of

the unlocks will be having the full spectrum of economic uh activity on these assets and i do think that you need to be able to have a scenario where someone can buy something for just a dollar or just two dollars so i think a big unlock and probably you know also a big unlock for defy as well is being able to not have to spend fifty dollars in gas to acquire an nft um and at that point you know you you're not just sort of talking about these super exclusive like high value collector art

items then you're talking about things that just are useful because you know digital stuff on the internet is already useful in some context and there's no reason that it can't be traded on open markets and usable in other applications and just a better sort of more open primitive for for digital stuff as an example like you know anything from like uh you know djs will sell their their snippets of uh samples from their music right and they do that on like a you know some some marketplace out there there's no

reason that that could be an nfc as well it'd be tradable on you know hundreds of different marketplaces i like the analogy the analogy i've heard of what you're describing these like so we have the high value transactions going on right now in the nft world and in d5 in general to like soon in the future we'll have the lower value nft transactions and there'll be many of them it's it's very similar to like the bandwidth of the internet right in the early days when we had 56k modems uh we couldn't load graphics we couldn't stream movies we couldn't have

interactive gaming experiences what did we need more infrastructure we needed high bandwidth in order to do that and this is very much what nfts are doing and what crypto is is doing uh more trustless transactions per second that's kind of the one element of bandwidth of this entire space um but devin we've come this far and i want to get into what openc is um because that's important for us and i know there are a ton of bankless listeners who are actually users of openc we've done

tactics on openc like how to how to trade uh an es ens name which is a you know a domain name specific to ethereum it's an early nft case um can you tell us what openc actually is and as you're doing so can you fit it in the context of all the other things like layers that you see are important in understanding the nft market space and what goes on here sure so open c is a marketplace for nfts um so you can think of it kind of like

an ebay or amazon um but instead of physical items being traded around we trade these uh digital assets um and these are of course nfts um in terms of how we kind of fit into the ecosystem i think one one kind of way to think about nfts is um when you own a physical item um you can kind of do whatever you want with that physical thing right you could go and you could give it to someone across the world you could throw it in the trash if you really wanted to you

could go and sell it on ebay with digital assets there's never really been a uh digital asset ebay right because um you don't actually you've never owned your digital stuff right so now that you do own your digital stuff um you can go and you can sell any nft that's out there on openc right you can come and you can um you know you can connect your metamask wallet you can see all of your stuff in your wallet um and then you can go and put it on sale or you can go and

browse and purchase stuff now i think david you were mentioning um another sort of role of openc which was that we started so early in the space we actually started like right after cryptokitty's launch that um we uh we became sort of this explorer for nfts so we index every nft that's out there on the market um and uh we allow you to kind of dive in and see the history of the nft so if you click on one of those uh nfts uh

in the in the screen share here you can go and um look at all of the events that have uh happened on that nft so when was it created when was it transferred sort of the provenance of it and so we're sort of like an ether scan but a little more oriented towards um consumers as opposed to developers um so that's another another function and then the last thing i would say is that one thing that we've gotten into recently is just better tools for creators who want to go and issue nfts really easily so um

these rob gronkowski uh nfts for example um were actually created on openc um and then just sold directly through our platform so we've been investing in making that easier as well devin i want to dive into something that you said you said open c is an indexer for nfts and this is a subject matter that i've been trying to wrap my head around that i think is really really important so a piece of digital art can go through a hashing algorithm and spit out a hash and that is what an nft cites when it

cites that this is the token this hash is represented by this token and that's how we connect the art to the token the art doesn't exist on ethereum because art is very large in data art can be up to um up to like mega many many megabytes and a single ethereum block is less it's less than one megabyte right so you can't actually put art on the blockchain it needs to cite an alternative database and the way that we solve this problem is we just say that well this token we take that information we take that data run it through a

hashing algorithm and append to that hash to the token and that's how we say that these things are connected the problem is is if that database goes down we kind of lose access to the art but the hash is still persistent so if that image is circulating on the internet as data does on the internet it circulates infinitely copyable that persistency is available but what you'll be saying is is that openc is you guys index all of this stuff which to me represents some sort of redundancy or anti-fragility

right so like what if for some unfortunate reason nifty gateway goes down and you lose access to visualizing your nft and your art but at least open c has done some amount of indexing to help retain that sort of digitally native aspect of the art uh talk can you talk about that and why that's so important yeah i think it's a great point and it actually to to give a couple examples of this happening um this was you know maybe a year ago or something we we saw a bunch of games kind of shut down so

they would launch their nfts they'd allow them to be tradable they'd have this really simple game associated with it and then kind of decided like you know this isn't really working out so we're gonna go ahead and do something else and so there were these communities of people who had bought these game items you know that they know that like there's always a chance that the game you know stops stops developing and solving you know an early alpha early beta um but what they what they decided was well all of the game items are still out there on ethereum you can still look at them on

openc um and they decided to go and and rallied the community about around building the game um so they sort of built the game rebuilt the game they um you know took over the website and you know that's possible and without nfts but it's a lot harder right because the database is like very proprietary um you know you might the user login system is probably like some some proprietary system and the assets aren't like you know maybe they're they're like kind of deleted or whatever um and and so doing this where

you can um sort of revive the project um but because the assets are still out there and because open seas sort of serving as as you said redundancy layer is really interesting um and uh so i think yeah there there is this challenge on um on ethereum around the limitations of what you can store on chain and typically you just store the ownership layer on ethereum and then the actual metadata layer is off chain and so what

we've provided is sort of a utility for joining those two right so um the ownership layer will always be managed by this decentralized system um but there's these these parties that kind of act as indexers or kind of utilities for pulling in that data and making it available to users and and providing it even if the original project shuts down devin i got a question from youtube that is specifically about this and maybe you've already answered it in part but i

would like to address the question a little bit more directly this is from zeta4 on youtube thanks for the question uh can we please talk about asset hosting which is what we're talking about there was a recent example of someone changing the art asset after an nft was sold on open c ipfs slash r weave support when question mark maybe you could also talk about uh what um ipfs or rweep support and how that can help this whole all of this infrastructure right right yeah i think it's um so to kind of dive into the technical

details um when when nfts first emerged um you had cryptokitties and again they had the cryptokitties ids stored on the blockchain but then the cryptokitty metadata the name description image was stored on their own servers right and so if particularly has ever shut down um you know there'd still be the redundancy of openc but um the sort of original source of truth for their productivities would could disappear um and so now what what people have started doing here you know what a lot of projects do especially

these really high value art projects is they store the metadata on a decentralized file storage system like ipfs or our weave and then we can sort of go and pull that and host it on our own server so that it can be easily displayed but that source of truth is um you know as long as those decentralized networks keep on running you can't really tamper with your the original metadata and you can't mutate it um you can't change it so um in terms of openc we are working on currently when you create an asset on

openc we we just use our sort of caching layer and we um post it centrally and it does mean that if if you wanted to go and change the metadata you could um but we are work actively working on um making giving you a bunch of different options so if you want to use a decentralized file storage system to make your entities you're welcome to um and uh i do think that that's a very important piece of the space to keep the art truly kind of decentralized and not dependent on a third party i will say that i think sometimes um

people i think there's an important element with all of these conversations around pragmatism right um and uh i think you know there are often oftentimes i think people overlook how strong the incentives can be to um maintain these sorts of uh platforms and the and and maintain the metadata in a in a way that aligns with the user's interest for example for a game um building assets right like they're incentivized they're not going

to necessarily go and um change the assets willy-nilly and if they do openc will have a record of that right so there's still accountability in place if if you're using a centralized api but i do definitely agree that like as time goes on um especially for these really high value art pieces it's critical to have them stored on decentralized file storage systems as opposed to just on central servers so devin we we often talk about all of crypto as this new digital economy that has suddenly sprung up so