Speaker 1: I'm Stacy Marie Ishmael, Managing editor of Crypto for Bloomberg Views,
Speaker 1: and this is Bloomberg Crypto at Daily Bloomberg. I heard
Speaker 1: podcast It's Wednesday, August t n T a non fungible token,
Speaker 1: largely digital obt s. What is the actual use case
Speaker 1: of these decentralized assets. At the height of n f
Speaker 1: T menia, everyone from athletes like Tom Brady to celebrities
Speaker 1: like Justin Bieber seemed to be either buying or talking
Speaker 1: about buying collections like Boardy Club. Non fungible tokens aren't
Speaker 1: just pictures of monkeys, though, even if that's how most
Speaker 1: people understand them. They exist on the blockchain, and buying
Speaker 1: or selling them typically requires paying in some kind of
Speaker 1: cryptocurrency like Ether. But all the link between n f
Speaker 1: T prices and the prices of tokens like Ether isn't
Speaker 1: always straightforward. It's true that n f t s haven't
Speaker 1: been entirely spared from the chill of this current crypto winter.
Speaker 1: For more on n f T s and how and
Speaker 1: whether they're holding up these days, I'm joined by Bloomberg
Speaker 1: reporta Pratana Pokash. N f T s fundamentally I mean,
Speaker 1: if you go back to the definition, is it's about
Speaker 1: a certificated ownership prota. Welcome. Yeah, thank you for having me.
Speaker 1: It's an absolute pleasure. We're gonna talk about n f
Speaker 1: T s. Why are we going to talk about n
Speaker 1: f T s. What's happening? Well, it is the hot topic.
Speaker 1: It has been for a while, so there's just a
Speaker 1: lot to unpack over there, so I'm excited, excited to
Speaker 1: talk about it. Excellent. I was reading your story that
Speaker 1: you wrote for Bloomberg Quick Take, which I'd love for
Speaker 1: you to just tell our listeners a little bit more
Speaker 1: about what that franchise is, and a couple of things
Speaker 1: jumped out at me that we will talk about. So
Speaker 1: you know, for sure, I want to hear your perspective
Speaker 1: on average n f T prices, how they're doing compared
Speaker 1: to the broader crypto markets in this so called crypto
Speaker 1: winter that we like to talk about on the podcast,
Speaker 1: and then you know, just a little bit of where
Speaker 1: prices are holding up. What that might be about. Right,
Speaker 1: Is it that there is this base of buyers that
Speaker 1: really have strong conviction and n f T s. Is
Speaker 1: there something else going on with tokens? So we'll get
Speaker 1: into all those things. Tell me more about what quick
Speaker 1: take is, all right, So quick take are an explanatory
Speaker 1: type of I guess the pieces that we do at Bloomberg,
Speaker 1: which aims to unpack some of the bigger concepts, things
Speaker 1: that are happening in the world, or words that we
Speaker 1: end up seeing a lot in the news but don't
Speaker 1: entirely understand. So quick take helps break that down and
Speaker 1: explain it all from scratch, just so you understand. And
Speaker 1: so there's no jargon there, there's no complications. You just
Speaker 1: take what it is and digest it in more platable language.
Speaker 1: As you were proporting this out, given everything that you've
Speaker 1: just said, what was like the hardest thing for you
Speaker 1: to explain about how n f t S work Probably
Speaker 1: the board apes, because I'm so struggling to understand what
Speaker 1: it's all about. And I think that's what the whole
Speaker 1: crypto world and the world of n f t s,
Speaker 1: that's what it's been. I mean, it's been a lot
Speaker 1: of explaining and it's been a lot of redefining at
Speaker 1: various points in time. So yeah, it was quite a
Speaker 1: quite a learning for me as well. Now when you
Speaker 1: talk about board apes, so what we're talking about here
Speaker 1: is board Ape Yacht Club, which is probably still one
Speaker 1: of the single most successful, definitive coveted choose your adjective
Speaker 1: here collection of non fungible tokens ever to have been created.
Speaker 1: What about these n f T s in particular were
Speaker 1: so interesting to people? Like? Were they expensive? Were they
Speaker 1: were were the exclusive? Was it some combination? It was
Speaker 1: exclusive and it was also something so different that people
Speaker 1: had never kind I've seen before. We saw a lot
Speaker 1: of celebrities buy into this trend. And what happens is
Speaker 1: you want to see a lot of public people, public
Speaker 1: personalities take two n f T s. It somehow lends
Speaker 1: it a legitimacy that everyone wants to be in on
Speaker 1: as well. So I guess a combination of those things
Speaker 1: and and just this access to a more exclusive club
Speaker 1: just created a sense of hype because the moment you
Speaker 1: buy a board Ape, you you get access to a
Speaker 1: discord server specifically for members of this board Ape Yacht Club.
Speaker 1: And the discord server is like video games lack. Yeah, Yeah,
Speaker 1: that's how I think of it as well. I think
Speaker 1: that's the I mean, I can't imagine what must be
Speaker 1: going on in that chat but that's the closest I
Speaker 1: can think of. But yeah, I think this, this whole
Speaker 1: sense of an exclusive access or special ownership is what
Speaker 1: got a lot of people interested in it. But what
Speaker 1: do you actually own? You own the anim nation of
Speaker 1: the board ape, so you get to customize it however
Speaker 1: you want, maybe put a blonde wig on the on
Speaker 1: the ape, or color the skin differently, or whatever it
Speaker 1: is that you want to do with it. But you
Speaker 1: just own the animation of that. And that's pretty much it.
Speaker 1: So does the Is the n f T the ape
Speaker 1: or is it the right to own the ape? I
Speaker 1: want to say both, because n f T is fundamentally
Speaker 1: I mean, if you go back to the definition, is
Speaker 1: it's about a certificate of ownership. I guess that's the
Speaker 1: easiest way to put it. It's the ownership do that ape,
Speaker 1: I guess in this particular context. But if we talk
Speaker 1: about it more broadly, it's it's certificate of ownership for
Speaker 1: any work of art, maybe even a tweet. Sometimes that's
Speaker 1: what you're really paying the price for, which is interesting
Speaker 1: because one of the in the in the sort of
Speaker 1: the earlier days of board ape, there were people who
Speaker 1: were trying to figure out do they own the rights
Speaker 1: to this particular print or do they actually own the
Speaker 1: underlying intellectual property of that ape? Would they be allowed to, say,
Speaker 1: turn that ape into a movie or you know, as
Speaker 1: a character, or print a line of T shirts associated
Speaker 1: with it? And I think when we're talking about n
Speaker 1: f T s, one of the things that's always important
Speaker 1: is to remember that these are in addition to being
Speaker 1: apes and additions being certificates of authenticity or ownership, they're
Speaker 1: also contracts. And so with contracts you have, you know,
Speaker 1: parties to an understanding buyer, seller, creator, recipient, and then
Speaker 1: a bunch of jargon that defines what you, as the
Speaker 1: person who owns or has made that thing, can actually
Speaker 1: do with that thing at the end of it. Have
Speaker 1: you found that people understand all of the legal ease
Speaker 1: that is sometimes associated with these things. Maybe there's a
Speaker 1: fraction of people who do, but I think a majority
Speaker 1: of people probably don't. I think there's a great deal
Speaker 1: of mob mentality attached to just this n f T market,
Speaker 1: because you see someone do it, and then you see
Speaker 1: someone who's super famous do it, and you want to
Speaker 1: do it as well. So I think that there's not
Speaker 1: a lot of thought into this sometimes. Of course, I
Speaker 1: I want to completely credit all the investors have thought
Speaker 1: about this and their research, did their research and want
Speaker 1: to diversify their portfolio and decided to invest in n
Speaker 1: f t s. But of course there's a fair deal
Speaker 1: of buzz and and just like social you know, hype
Speaker 1: as they put it, um, So I don't think everyone
Speaker 1: is completely educated about the legal technicalities of it. Yeah,
Speaker 1: I'm just gonna ask our listeners. If you're a person
Speaker 1: who owns an n f T and you have read
Speaker 1: all of the terms and conditions associated with that n
Speaker 1: f T as well as the platform that you bought
Speaker 1: it on, please email us. I was very interested in
Speaker 1: hearing from you and what that experience was like and
Speaker 1: how many years you spent in law school. Definitely, so
Speaker 1: if we were having this conversation seven or eight months ago,
Speaker 1: we would be talking about a very different vibe, right
Speaker 1: we would. We would be the beginning, maybe the middle
Speaker 1: of the hype cycle. There would be people showing up
Speaker 1: on Good Morning America or the Today Show talking about
Speaker 1: their their n f T s. People would be trying
Speaker 1: to like your friends would be like, Hey, check out
Speaker 1: this really cool collection and you can get into it
Speaker 1: super early. Now we're having a little bit of a
Speaker 1: different conversation. We're having a conversation where it's like, how
Speaker 1: prices have come down. There's still a degree of enthusiasm,
Speaker 1: especially among like certain artists, certain creators, But the sort
Speaker 1: of you know, Tom Brady with laser eyes pitching you
Speaker 1: on his n FT platform autograph energy of several months
Speaker 1: ago is not quite the same what's been going on.
Speaker 1: I think for this we need to maybe rewind a
Speaker 1: little to the Terra Luna collapse. How do you make
Speaker 1: up what's happened with Terra and what it says about
Speaker 1: the future of quote unquote stable. I'm really curious about
Speaker 1: the responsibility of the tarot ecosystem now that so many
Speaker 1: people have lost money. Is it completely invest at your
Speaker 1: own will here or are there going to be chances
Speaker 1: to recoup some of these losses in any fashion they
Speaker 1: own action. First of all, this is a very bumpy
Speaker 1: story that we're looking at here right now. It's a
Speaker 1: stable coin and it's not stable. What is al risk
Speaker 1: for this stable coin as it looks to shore up
Speaker 1: if pegged to the dollar? But the question is does
Speaker 1: the stable coin survive at the end. I guess n
Speaker 1: f T was pretty much got in that storm and
Speaker 1: it didn't have an escape from there. And what that
Speaker 1: crash did above all was that it shook investor confidence
Speaker 1: because it was unprecedented and it basically put the whole
Speaker 1: cryptosystem in jeopardy, or at least was perceived to put
Speaker 1: the whole crypto system in jeopardy because of that loss
Speaker 1: of confidence. Yeah, definitely. It was one of the first
Speaker 1: really big holy shit moments where are allowed to swear
Speaker 1: on the podcast in this particular cycle of crypto um
Speaker 1: And what I mean my that is, you know a
Speaker 1: lot of people who owned tokens, whether Luna, whether Terror,
Speaker 1: whether others, and n f T s had not been
Speaker 1: in crypto a very long time, right, Like these were
Speaker 1: folks who came into the space three maybe five years ago.
Speaker 1: They didn't have the memory of the previous time these
Speaker 1: things had happened, and so it really it rattled a
Speaker 1: lot of people. And we're still dealing with the fallout.
Speaker 1: We'll be right back with more from Bloomberg Reposa Protana. Now,
Speaker 1: the overall market has been in a pretty depressed state
Speaker 1: since then. In the aftermath of terror, Luna We've had
Speaker 1: the blow up of the Three Hours Capital Hedge Fund.
Speaker 1: There's a lot of scrutiny and attention right now around regulation,
Speaker 1: what's going to happen with some of the big exchanges,
Speaker 1: Various big players in the space of filed for bankruptcy
Speaker 1: or are generally distressed. So the vibes, you know, the
Speaker 1: vibes are a bit more stressed. Our n f T
Speaker 1: is moving in the same direction as everything else, Like,
Speaker 1: is there anything about this part of the ecosystem that
Speaker 1: is holding up or behaving differently? Yeah, I think n
Speaker 1: f t s have definitely suffered a little bit of
Speaker 1: a blow given everything that's happening in this in the
Speaker 1: broader crypto space. But that being said, there's still not
Speaker 1: like rock bottom. They haven't hit rock bottom yet. You
Speaker 1: still see n f t s grow in spaces that
Speaker 1: had previously not been explored. I think more recently we
Speaker 1: saw game Stop announced new marketplace for n f t s,
Speaker 1: which is I guess a new development and something that
Speaker 1: everyone is interested in knowing how that kind of grows. Yes,
Speaker 1: especially because the timing it was a little bit challenging
Speaker 1: for definitely, and and so that calls to question whether
Speaker 1: n f T s are going to see the same
Speaker 1: kind of downturn that cryptocurrencies have probably seen. Your story
Speaker 1: also mentioned the fact that opens which for a while
Speaker 1: was kind of the biggest, buzziest, most successful n f
Speaker 1: T marketplace they were like kind of like an eBay
Speaker 1: for n f T s by volume, recently laid off
Speaker 1: of their staff. You know, they said that they were
Speaker 1: generally making this decision to in full awareness of market conditions.
Speaker 1: Give me an example of how market conditions are and
Speaker 1: n f T s right now, like how our prices?
Speaker 1: How are sales? Yeah? So I think in June sales
Speaker 1: were down on Open Sea, which, like you said, is
Speaker 1: one of the biggest marketplaces for n f T s
Speaker 1: um and when we look at the floor price, it
Speaker 1: was almost down, specifically for the board Aps Yacht Club,
Speaker 1: which at one point was soaring it upwards of food dollars.
Speaker 1: And when we talk about floor prices, we mean the
Speaker 1: kind of like the minimum listed price that something is
Speaker 1: currently available for sale. And n f T in this
Speaker 1: collection is available for sale. Got it. So if you
Speaker 1: were a person who bought at K and you're hoping
Speaker 1: to sell at for entry K and now it's like ha, ha,
Speaker 1: it's worth ad k. You were having a very hard period. Yeah,
Speaker 1: I can't imagine what they must be going through, but
Speaker 1: I do. I do think they're holding on because there's
Speaker 1: hope for n f d s. There may be hope
Speaker 1: on what basis like why are where are people finding hope?
Speaker 1: You see, n f T is being adopted in a
Speaker 1: number of different spaces, whether that's the metaverse, you know,
Speaker 1: the all famous metaverse, or gaming. We're also seeing a
Speaker 1: massive market in sports memorabilia, and so a lot of
Speaker 1: what we experience, anything that we see or can hold
Speaker 1: in our hands, can be made into an n f
Speaker 1: T today. The I guess the spaces that people can
Speaker 1: grow this market in. It just keeps expanding um each
Speaker 1: time something new comes up. That's certainly the pitch that
Speaker 1: we've heard. You know, we had Nicola Julia, who's the
Speaker 1: CEO of so Rare, which does kind of fantasy sports
Speaker 1: with an n f T element on the platform. We
Speaker 1: just believe that an actually are the best feed for
Speaker 1: game it TEMs, but we are. We don't see the
Speaker 1: world nifty in our product like it's just the best technology.
Speaker 1: We've spoken to the CEO of Royal, which is an
Speaker 1: n f T platform for musicians. The most powerful aspect
Speaker 1: of it is again the ability to know authenticate ownership
Speaker 1: of digital types of assets. And that's something that we
Speaker 1: really haven't seen in the past that we're going to
Speaker 1: see a lot of development in the future. A lot
Speaker 1: of n f T c o s we've been to
Speaker 1: feed I'm finding um and they've you know, they've said
Speaker 1: something very similar, which is that we're just at the beginning,
Speaker 1: right and this this latest collapse is more about a
Speaker 1: shakeout in some of the more speculative applications maybe or
Speaker 1: the applications that aren't necessarily about collecting or not necessarily
Speaker 1: about access to real world experiences in the way that
Speaker 1: you are describing it. Of course, they could all also
Speaker 1: be wrong, So you know, this is this is certainly
Speaker 1: going to be one of those stories that we're just
Speaker 1: going to have to continue to pay attention to and
Speaker 1: see what happens. Yeah, and I think that along with
Speaker 1: the laps that we were talking about, one of the
Speaker 1: things that may have also factored in was just the
Speaker 1: number of frauds in scams and allegations of insider trading
Speaker 1: that was just being thrown around in this n f
Speaker 1: T and crypto space that I think was bound to eventually. Yeah,
Speaker 1: just just make investors reevaluate what they're putting their money into. Terrific. Well,
Speaker 1: thank you so much for being on the pod, Pratina,
Speaker 1: and it is a pleasure to get to work with you.
Speaker 1: Thank you so much, Thanks for having me. You can
Speaker 1: find more of Pratina's reporting on the Bloomberg Terminal, on
Speaker 1: Bloomberg dot com or on Twitter. She is at prof
Speaker 1: per Cash that is p r A r t H
Speaker 1: p r a k A s H. On the next
Speaker 1: episode of Bloomberg Crypto, n f T is really leaped
Speaker 1: into pop culture prominence in but they've been around since
Speaker 1: at least two thousand fourteen, and despite current market conditions
Speaker 1: which aren't great, new tokens and collections are still being
Speaker 1: launched every day, including by luxury brands like Gucci and Prado.
Speaker 1: Our next episode will feature a panel discussion that we
Speaker 1: recorded during the Bloomberg Live Crypto Summit that was held
Speaker 1: in New York in July. You'll hear from industry leaders
Speaker 1: like Avery Akin, Enya Vener three, Helen High of Finance,
Speaker 1: and digital artist People Pleaser sometimes known as Emily Yan.
Speaker 1: This is Bloomberg Crypto, a daily podcast from Bloomberg and
Speaker 1: I Heart Radio. For more shows from I Heart Radio,
Speaker 1: visit the I Heart Radio app, Apple Podcasts, or wherever
Speaker 1: you get your podcasts. Send us your comments, questions, or
Speaker 1: suggestions for the show to Crypto at Bloomberg dot net
Speaker 1: or find us on Twitter We're at Crypto. The supervising
Speaker 1: producer of Bloomberg Crypto is Vicky ver Galina. Our senior
Speaker 1: producer is Janet Babin. Our producer is Sharon Burriro, associate
Speaker 1: producer is Ty Butler. Desta wonder At is our engineer.
Speaker 1: Original music by Lee Sidrin. I'm Stacy Mariashmal. We'll be
Speaker 1: back tomorrow. M