FLUF World Founder Aaron McDonald on the Vision for a Crypto-first Metaverse

Aaron McDonald shares his vision for the metaverse and his mental model for user experience and adoption funnels.
Aaron McDonald shares his vision for the Metaverse and his mental model for user experience and adoption funnels.

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Background

Mint Season 6 episode 6 welcomes Aaron McDonald, crypto OG and founder and contributor to Altered State Machine, FLUF World, Futureverse, Sylo, Centrality and D64 Ventures.

Time Stamps

  • 01:37 – Intro
  • 05:14 – Crypto in 2015-2016
  • 14:09 – How Do We Build a More Positive Metaverse
  • 22:16 – Creating Stickiness in the Metaverse
  • 30:06 – What Does Ownership Really Mean In Web3?
  • 30:39 – Strategies for Using On-chain Data
  • 39:51 – Taking Web3 Mainstream
  • 43:28 – Current State of UX in Web3
  • 47:30 – Understanding Adoption Funnels
  • 53:09 – Yay or Nay on CC0?
  • 56:08 – Critics POV on CC0, Why Are So Many Not In Favor of the Model?
  • 59:37 – What is the Size and Technical Capability of the Teams Working on the Futureverse?
  • 01:01:01 – Outro

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Mr. Aaron McDonald. Welcome to the podcast. How are you doing my friend?

Aaron McDonald: Yeah, I’m good man. stoked to be here. Thanks for having me on.

Dude I’m Stoked to have you

Aaron McDonald: Drum set.

Yes. What do you what do you know about drums? 

Aaron McDonald: I’m a drummer.

Okay. Well, how long you been playing for?

Aaron McDonald: I think I started when I was maybe teen, somewhere around that age in the Highland Pipe Band.

Oh my god. Wait, what’s the highland Pipe Band? Give me a little on chain on that.

Aaron McDonald: Scotland where they have the bagpipes, it’s playing the kiddos in the in the snares. 

Okay.

Aaron McDonald: Yeah, so that’s where I started.

Damn, down to your roots. Where do you go from there?

Aaron McDonald: I’m just like, into like. I never got like into it professionally or anything like that. It’s just like, if I like the sound of something I try and play it.

Alright, what are your favorite bands actually that you’re listening to right now?

Aaron McDonald: Oh, right now like I guess my favorites. Like old school. I kind of not into like anything particularly modern, except for probably the EDM side of things. But like, old school hip hop, I’m into a like, like Nirvana and I like Metallica, I like Bush, I like those older, like, older school, you know, my age when I was growing up and having fun and raging.

Intro

Okay, all right. Well, I think I got started on Nirvana as well. I got started playing damn, Zeppelin like all the classical rock, art, all those people. So, I feel like I know a thing or two. But that’s not why we’re here today, even though it’s a good segue into why we’re here today. Very, very relevant, actually, to what you’re sort of doing in crypto and web three. But I think before we get into that, Aaron, who are you? Give us a quick intro? More specifically, I’m curious to know about your history, and then how you sort of transitioned into web three?

Aaron McDonald: Yeah, man. So I am, I’ve been in tech for 20 something years now. I started literally at the ground level, like digging trenches, and laying cables under buildings and stuff like that. And kind of made my way up in the engineering side of telecommunications from that eventually, as a Senior Network Engineer on the voice over IP and mobile and radio network side of things. And then from there went into like product development, product management, marketing, and business, the kind of more business exec roles and then out into corporate venture. So, it kind of made my way through like the enterprise IT, telecommunications side of things. And in each one of those roles, kind of just learning a little bit more about like how a business runs, I guess, and then eventually stepped out into startup world. I got into web three pretty soon after that. And I’d been following Bitcoin for a while. It was kind of interesting. But what really got me was when Ethereum came along with smart contracts, and you could build these interesting applications that were built on community owned infrastructure, and that was like a really appealing idea to me. I didn’t get like full time into it until 2016. And I started a venture studio then and called centrality and what kind of made kind of pushed me to go full time in web three was meeting with a friend of mine, Dr. Luka Mola, who owns a law firm up in Zurich called Inime. He and I were talking down here in New Zealand. And he knew a lot about smart contracts and the Ethereum ecosystem and stuff like that, and I was kind of surprised like that time it was a little bit obscure, it wasn’t, certainly wasn’t mainstream. And I asked him like, How the fuck do you know so much about secure technology as a lawyer up in Switzerland? And he was like, you know, well, we help like the Ethereum foundation come up with the legal structure and so he like knew everyone at the time that was kind of, you know, it was.

Who is who.

Aaron McDonald:  Yeah, who’s who? And so, I spent quite a bit of time up meeting people and, you know, going through, like what was going on in the scene. And that got me really encouraged to kind of go full time into it. So, I did.

Wait. So, we have very similar actual intro stories. I guess the comment under, the underpinning theme is to crypto Valley. When I was studying in college, I told my advisor that I want to do my last semester abroad in Switzerland because of all the activity that was happening in tube. Yeah. And so, I tried finding an internship or some type of work out there. 

Aaron McDonald:  Oh wow. 

Crypto in 2015-2016

Yeah. So, I lived there for like, five and a half months and I couldn’t get work because I couldn’t get a visa as a US expert, which sucks. But I ended up moving to Austria, I was living in Vienna, I was working with like, a couple of block county startups. So, I’m curious, because I got started, like my segway was around 2017. Okay. But every year in crypto is like a decade. I’m curious, what was crypto like around 2016, 2015? Because around that time Ethereum sort of came out? I feel like when that launch all this new energy maybe could have like spurred and sort of maybe influenced your way as well.

Aaron McDonald: Yeah, it definitely. Like when Ethereum came out there was like, I think a lot broader activity, because you brought in a new class of developer, you know, that kind of on the application side, because Bitcoin applications at the time were pretty nit. I mean, probably still pretty nit. But the developer ecosystem that was building out around Ethereum, and I think even back then, like some of the, it was starting to kind of get a little bit more into mainstream tech, like kind of understanding and language like consensus, and Joe Lubin, we’re doing quite a bit of work to, like form the enterprise Alliance and stuff like that. So it’s becoming like more of a killer back then. But I think probably, like any hype cycle around that time, you know, if there wasn’t a lot of deep knowledge, as it started to kind of build out into more communities and like it was blockchain is gonna solve every problem that world and like but on the blockchain, you know, I was that kind of like, energy. And that built up, I guess, into 2007 teams like mania. And so yeah, so it was super high energy. And, and there was this, like, all this kind of rose-colored optimism about how fast things were going to happen, and how big the change is going to be immediately, and all this kind of stuff. But that’s good, you need that energy in any market developments, you know, if you don’t have that, then you can’t get past. You can’t get past like, significant hurdles, that exists to change anything, I saw the same thing, like through my tech career, when a no, like, the mobile internet came along, like, there was all this, you know, exuberance about what the mobile web was going to be, but the actual applications at the time were really shit. And, you know, the capital that went into all of that, a lot of it was went nowhere. But some of it went somewhere. And now we have what we have. And in cloud computing was the same thing. When nets first came out, it was like all the skepticism about, you know, I was just, it was just your data center in someone else’s building, and kind of all this kind of, you know, stuff that people were saying about, you know, why it wouldn’t work, and the infrastructure was pretty crappy. And it probably cost as much as it cost to run stuff on premise. And, you know, if you’d really did the math, and the story wasn’t quite the end. And then, you know, it progressed, and you know, winners came out of that cycle. And we have what we have today, AI was the same like when AI machine came along. Like these are just hype cycles that keep. And we were in that zone theme, and probably still are, to a certain extent, and in the web three space.

So, you’ve been through a lot of hype cycles, whether it be in crypto, outside of crypto, how would you sort of compare your experience in other industries and seeing how cycles evolve to where we are today in web three.

Aaron McDonald: Really interesting and different because in all of those cycles, you had the same things happening. But the money or the capital associated with those activities was very tightly held amongst, you know, VCs and these kinds of layers that exist between consumers and technology, right? The massive difference in this cycle, which I think is why the technology has gotten somewhat of a bad rep in the mainstream is that you’ve connected capital directly to the activity that happens in the infrastructure and capital flows, you know, where the tension and so, you’ve got this combination of a normal hype cycle that has been supercharged by this social attention capital lifecycle. And so, we see money moving at the speed of information, which we never got before. And that has positive you know, consequences sometimes. You know, for example, if a good idea that may never have got funded by NBC because it was like, way too, out there or didn’t right after monetization, or something like that, like some of the great infrastructure and protocols that have been built in web three may never have been funded by a VC. And so, this kind of flow of capital that’s happened in web three, got those things done, and they’re great, like, you know, steppingstones on the journey that we’re trying to create for web three infrastructure. On the other hand, you get rugs because people like, oh, shiny rock, right. And so, you’ve got like, the good and the bad, and the cycle. And I don’t even think it’s now unique to crypto and web three, like crypto and web three take all the heat for it. But FinTech has essentially done the same thing for, you know, traditional capital markets as well, we saw this with the Robin Hood effect. And so, it’s just a reality now that, you know, consumers are closer to the monetization of technology than they ever have been. And that creates these kinds of wild, volatile environments. It’s just, I think it’s just how things work now going forward.

So, when you initially got into crypto, did you like, did you get the vision immediately, like went all in bought a bunch? Like, what was your initial sort of like reaction, actions you took sort of coming in?

Aaron McDonald: Yeah, I mean, I got the vision, I think, I don’t know, I can’t remember, it might have been $7 at the time, so I bought it. And so yeah, I mean, I definitely like I’m a true believer, like in the sense that beyond the financialization of it, the thing that’s really appealing to me is society is on this like precipice. I think where technology has such a big influence over how society operates, and increasingly over how society thinks that if the applications and infrastructure that we use and increasingly reliant upon, isn’t in the hands of communities, isn’t democratize, then society becomes a pretty scary place going forward. And we’re at a fork in the road, where we have the chance to make the choice, because we aren’t being influenced to the extent or we our society hasn’t been influenced to the extent and our laws have been influenced to the extent, that we don’t have the opportunity to make the choice. And that will happen, you know, if we keep going on the path that we had been, we would never have got the choice. And we wouldn’t even maybe have considered it. Because the, you know, the mind control machines that exist within social media would have stayed at status in a different direction. And so having that as the kind of center for why you’re in this space, I think, is a really important thing. And it helps you go through the ups and downs, and the highs and lows and all that kind of stuff that happens in this volatility, that happens in the space because the true north is like can we make a difference for society? And that’s a really important thing.

How Do We Build a More Positive Metaverse

So, let’s talk about that, making a true difference for society, keeping in mind that these mind games that social media currently has, right, and I feel like it’s only going to get even more digital. One thing I know you’re very vocal about you love is the metaverse and the interoperability of the metaverse, right? Are we falling deeper? are we falling deeper into, you know, those mind games that you sort of brought up? How do we build a Metaverse that’s like more, kind of like pushing through net positive, you know, emotions, net positive reactions, connections, etc.

Aaron McDonald: Yeah, I mean, just on that last point, if you want to kind of listen to someone, talk about what I just talked about. There’s a YouTube by Maria Risa, which explains this in a more eloquent way than I did, and kind of paints a picture of, you know, the effects of survival of democracy itself. And so, I recommended watching that YouTube. It’s a Nobel Prize lecture and it goes on.

I will clip it in the show notes. Interesting. 

Aaron McDonald: Yeah. So, the metaverse, I think it’s probably helpful to explain what I think the metaverse is because this is another hype cycle. And obviously, you know, we’re in this kind of information explosion around the term of the metaverse now. And so, my view is the metaverse is made up of a few things. Firstly, the metaverse exists. It’s not something that’s coming. It’s something that’s already here. And the metaverse is the consolidation of user experience silos into a more immersive user experience. That’s kind of the first tenant of it. And what I mean by that, so in our kind of digital lifestyle, and even not just digital, just kind of our social and economic footprint, we have these silos traditionally, like gaming, or communications, or commerce, or media, or finance, and they existed in these very separate bubbles, you kind of went to do this thing here. And then you went to do that thing there. And you went to do that thing there. And over time, as the internet’s been evolving, we’ve been consolidating those bubbles. And so, we had media, which was this thing, TV shows, and broadcasting and all that kind of stuff. And we had communications, telecommunications, where I worked in, and they were very distinct worlds, you know, and they existed entirely independently of each other, you know, even separate infrastructure at one point, they didn’t, you know, the broadcast networks had their own networks, which they ran content over. And so, we saw probably the first major step of the metaverse when social media came about and collapsed, communications and media into one thing. And so that became like a step on the journey of the metaverse. 

The next kind of step, that’s an obvious one is that commerce was a separate, you know, user experience. Now we have social commerce, you can, you know, go through a process of being in that social media environment and purchasing without leaving that experience. And so, we’re gonna, we’re seeing this kind of further consolidate finance, you know, we have, like in the mainstream world, an example of this would be Buy now pay later. So, the social commerce experience now has a finance experience bedded in it, which is a one clicks thing. In web three, we’ve seen, like the hyper financialization and gamification of everything, you know, that’s kind of with the bubble that web three exists in is kind of like a foretelling of the future of how mainstream is going to kind of move through. And so, the metaverse is like about consolidating all of those things. And that’s why gaming I think, comes up so much in Metaverse conversations. Many people say I’m building a Metaverse or no, you’re just building a game. And, but Gaming will be the UX for the things that we interact with in our daily life. And so, it is relevant in the context that this more immersive internet exists. And that’s a gaming type experience, but it’s actually just the consolidation of all of those things. So firstly, the metaverse is like the future of our economy. Everything we do exists inside of it, and it’s much more consolidated user experience than exists today. 

The next thing that makes the metaverse the metaverse is the metaverse is, the collection of interoperable applications, data and content. And so again, going back to that I’m building a metaverse. No, you’re building an app. The thing that makes it part of Metaverse is if it’s open and the content is transportable, and the user metadata is transportable, and all of the context is transport. That’s what makes it the metaverse. That’s when all of these things can interact with each other. And the third thing, probably the most important thing is that the metaverse exists at the data layer, and not the application layer, and it only exists if the content is built on user owned infrastructure. Because otherwise, it’s just a game. We’ve had those for 20 years, we’ve had like, the ability to, you know, buy and change skins and do all that kind of like all the things that happen at that content layer we’ve been able to do before. The thing that makes the metaverse different is that users can move their data identity context, currency between applications, the only way they can do that is if it’s on community run infrastructure. Because if it sits on someone else’s server, you never actually own it.

So, you know what’s interesting, actually?

Aaron McDonald: In addition, say they could say, look, hey, you can take your fortnight avatar over to here if you want to. Okay, cool, awesome. Until they change their mind. And if the infrastructure isn’t community owned, they can always change their mind and therefore you can’t just take it wherever you want. 

I gotta, I got to comment on that, though really quick, because it feels like on that tangent, first of all, blockchains are the metaverse then. So, like this whole concept of data and interoperability like it’s going to be built on an open network and open ledger network. And what Facebook sort of tried to do by commercializing the metaverse as a way to sort of like create this marketing scheme to buy Oculus Rift right to kind of enter their Metaverse kinda like they just sort of like prove that they can’t do that by maybe integrating with flow and polygon and all these additional like networks because now they’re just a part of the bigger Metaverse sort of thing. You know what I mean? Am I thinking about this the right kind of way?

Aaron McDonald: Parallel into Facebook’s Metaverse because there is only that Metaverse, you can go into Facebook, but with an Oculus, which is what they’re built. But the metaverse is the collection of interoperable content and data that exist on user and community owned infrastructure. Anything else is just your game. And you can flap a Metaverse on it, but it isn’t the metaverse.

Creating Stickiness in the Metaverse

So, on that same train of thought, a lot of these big web two companies built their resiliency through the data that they hold, right and the network effects that they were able to create, in crypto if we’re going to build for an interoperable network or an interoperable future, right. And you can take your users and your data with you anywhere you go. Right. How do you actually build stickiness? How do you build a moat? UX right now is only so much of a privilege, right? But that’s gonna get better over time. If you’re building some type of financial application, then capital could be your moat, right? Liquidity could be moat. But beyond that, if you’re creating like rich experiences, right? Where does the moat? Where does the stickiness come in?

Aaron McDonald: This is the most important thing about web three and it’s the thing that answers your original question before I tell us on a tangent. Like if we assume that the metaverse is just the evolution of our society and economy, and that eventually everything we value exists inside of that, well, not everything, but like a good portion of what we value and how we interact with what we value exists inside of that. That’s really important that consumers are in charge, that end users are in charge and that the technology is democratized because otherwise someone else controls what’s important in our world. And that’s not a thing that society needs or wants. And so, the answer to your question is tied up in that which is, it forces people who are building things, to think first about community and share value with the community. Because if you don’t do that, as an application developer, then your users can take currency, data, assets, social graphs, writing somewhere else. And so, your mode is caring about your community. And whoever cares about their community and builds with that in mind, will create the biggest moat, because network effects don’t exist in the same way that they used to. You know, you take Uber as an example, right? 

So, I’ve seen multiple times when Uber was in a kind of bad PR cycle that people like fuckery but delete Uber. It’s kind of sweet. But then what, right, you know, like, next minute, you’re on the side of the roads, I shit, I’ve got to get an Uber for like, I shifted to something else, but they didn’t have enough drivers. And so, I was waiting for an hour. And so, I went back to Uber. And the problem there is you can say fuck the app, but you’re also saying fuck the network effect. And the difference in web three is that your network effect as portable as social graph is portable, and so when we build, like the open Metaverse operating system within the Futureverse, things like the silo protocol enable users to take that social network with them. And applications can move their social graphs with them. And so, people really can, you know, at any moment when you’re not thinking and putting the community at the heart of your decisions can move. And that’s what you want. Because that’s what creates democracy, you know, and technology, is the ability for people to say no.

I think another interesting thing that you posted online is on that same tangent, is this meme you versus the guy she tells you not to worry about. And on the left that shows Mark Zuckerberg is Metaverse and on the right, it shows basically web three, right, like all the avatars and web three, I think this is like a perfect depiction of what we just sort of discussed that sums it up into one image. Is there anything else to add on this topic?

Aaron McDonald: I mean, I just think, almost biggest belief that you could spend $10 billion or more building what meta has built and imagining that that’s where people want to spend their time on the internet. And that’s who they are, and that you and your creator of the fake versus Instagram. And you still think people want to be themselves online. Like the whole idea of that is just like farcical to me. If you actually took five minutes to look at what was happening in internet culture, you would know that that’s not what people want. And, you know, there probably will be plenty of people in whatever made us call them the metaverse horizons or whatever it is. But they’ll probably be your grandma. And you’ll have to go there, you’ll be punished by society, you know, have to go there and visit her because she doesn’t want to go into be a goblin and in fluff word, but most people won’t want to be there. I mean, like that was like, what? The early 2000s? 

That was basically it Yeah. Yeah, that’s funny. That’s really funny. Wait, okay. So, another thing that you also talked about was the data layer. A lot of what season six is about is kind of understanding on chain data, also from the perspective of how creators can sort of use on chain data to build communities. But I think a more interesting conversation, just on the tangent that we’re on is like the infrastructure layer for metadata, right, and what that looks like at scale. I think we’re just at the beginning stages of what an interoperable fanbase looks and feels like in web three, we’re seeing the emergence of new social platforms really playing on this new primitive, but nothing is at scale yet, nothing has really hooked, a lot of platforms like lens protocol, for example, like, I think they’re killing it, for example, right, I’m able to take my following, my subscribers everywhere I go. Whereas in like web two, you saw a lot of creator’s sorts of transition from Instagram to then Tik Tok in 2018. And they lost a lot of their edge, there’s stickiness. And then there was a new class of craters that emerge, maybe that’s good, maybe a refresh is healthy, you know, from time to time.

Aaron McDonald: At the application layer, so we can have that, we can have the reef fish at the application layer, and people can bring new functionality to the social graph. But you can move your social graph between those applications, you know, and actually, I think one of the reasons that was appealing to me in the early days of web three was like building a startup was becoming harder and harder, because even if you had, especially in the consumer space, if you had a really good idea, and you had capital, let’s say, and you had a really good team that executed really well, you could do all of those things. And then one of the big social networks could just add it as a feature and businesses did. They used to acquire those things.

That’s what’s happening with Be real right now, the new social app, they just added that feature, right.

Aaron McDonald: Exactly.

Yeah. 

Aaron McDonald: And so, this innovation, especially in that consumer and social app space was being killed because these big guys could test your whole business on more users than you’d acquired and figure out whether it was gonna be successful or not. And if it was, it’s a new button, right? And bang your businesses did. Whereas if the social graph is portable, then those innovators who come up with these new things have a better chance because the network effect can move at the speed of that feature becoming relevant and give them a chance at winning. It’s good for competition. Competition is good for consumers.

What Does Ownership Really Mean In Web3?

So, on that thought then okay, can you talk more about what ownership really means in web three then? So, there’s the element of being able to co-own a network via the tokens that you hold, right now on chain say, right, in terms of like how that network progresses, but I thought it was just like, some networks. Of course, some networks others are just.

Aaron McDonald: No. So, Bitcoin and Eth at the moment, although Eth close to switching and in ripples network, no. Any network.

Strategies for Using On-chain Data

I guess by network, I meant like, Yeah, okay. I guess I meant more on like the applications that are built on the network, right. So, through the governance tokens, for example. But that’s even, that’s a better example, right? Like, you can’t really do that right now. And have a say over the network itself, right, that everything’s built upon, which is a whole nother conversation. But in web three, when you think about ownership, okay, I still think it’s a very fuzzy term. And for my audience, the creator audience, right? The people, the musicians, the artists, the PFP creators, etc. Understanding what ownership means. And while you’re building a web three, right, I think that’s like that’s the secret unlock in my opinion, yeah, having access to a level of data to understand who your users are, that you otherwise maybe wouldn’t been able to have in web two is like the gold over here, as a project founder yourself, how do you think about on chain data in the context of owning your audience? And what does that really mean to you as an entrepreneur in the space?

Aaron McDonald: Yeah, I don’t even think, so that’s a very web two way of looking at things. And audiences is probably the right word to use in that context. So, in web two, you had audiences. And you had and they called them communities, but they weren’t, they were audiences. And you had ownership of your audience through these, you know, through gated, through the gated, the gated that exists on gated infrastructure, you track them, and that was your goal. And in web6 three, to be successful as an entrepreneur, you actually have to think about what community means. And communities are different audiences. And in really interesting and exciting ways, communities are participants in the thing that you build. And they influence the way that you build them. And they have control of certain elements of what you’re building, namely, the data that they’re contributing to the system. And so, ownership in web three is about me being able to move my identity, move my currency, move my content assets, move my social graphs, with me between applications. And at that point, you never own a consumer, you only have the privilege of them being in your community. And so, the notion of owning a user in web three shouldn’t exist, because the paradigm flip is that users are in control. And we went on an interesting journey to kind of, I went on an interesting journey to figure this out, we were trying to get businesses to work together to share common infrastructure for things that applications often build repetitively, over and over again. 

So, if you’re investing in a portfolio of companies, let’s say, you put a million dollars out, you know, to those companies and early stage, they’re going to spend 30% of that money building the same things, a login system, you know, a customer management system, all those kinds of things that every application needs. And so, we’re trying to get people to like, share those things. Because if you did that, then your cost of capital, the capital would be more efficient. And perhaps they could like work together to, you know, onboard customers and overcome some of these chicken and egg market problems that exists when you’re starting a new business. And then we got into this kind of contention of like, who owns the customer? Like if I onboard this customer, and it’s on this common infrastructure like what, you know, why should I give it over to the next guy? And then, like, collect, it’s like, no one owns the customer, the customer owns themself. And if you have to go into it with that mindset, then you open up all these efficiencies that can exist at the application layer. And so go going into web three, the idea of ownership of audiences, I think, is a bad way to approach it. build communities, don’t build audiences and users own themselves, keep those things in mind and then you’re on a good path. 

So that path.

Aaron McDonald: It’s not just on chain as well, I want to, like I think we try and solve too many problems on chain, there are other really good ways to build infrastructure that are not on chain, the ends that can be user owned. So, a big part of the future this data interoperability and acid interoperability is built using the dead standards, we’ve extended the standards to work as a kind of SKU system or an API for content as well, not just human identities. And so that data doesn’t have to live on chain. And it probably shouldn’t, because you want it to be able to scale massively like internet scale data across, you know, billions of assets. And users probably shouldn’t live on chain, but you can still build it in a way that the users own the infrastructure without going on chain.

Interesting. I’m curious how that sort of applies into you building, fluffed world in that entire community. What a great project. And so many, like sub communities sort of branched out from that, whether it be in the music NFT space, and the art space, movies, sports, the list goes on and on and on. And what a cool way to sort of just like create this movement and allow so many people to find alignment within it, and then create their own sort of what they imagined it to be right? Out of their own sheer creativity and their own sheer will, talk about that for a minute. Because it’s not easy to do, right? People go on Fiverr and try to create these PFP projects. But you’ve built a family, like an online family, right people sort of, also what’s interesting curating their own definition of what this could be and making it a reality. Talk to me about that.

Aaron McDonald: Yeah, I mean, first of all, I don’t want to say I’ve built it, we planted a seed, and the community built it. And that’s really important. Like, if you look, if you go and spend time in the future versus ecosystem, fluffed world altered state machine, party beers, the seekers, Adam Car Club, you’ll notice that what drives those communities is the members themselves. And we’re in this really magical position where we can plant a seed, they take it, and they start to be creative with it. And we can look at what they’re, you know, doing creatively, and then reflect that back to them in the next version that comes out. So, you’ve got this kind of co creation that happens with us, as we evolve the journey, you know, memes or fractions or community built, content will pop up that inspires the next evolution of that experience for those members in the community. And they’re out building it, they’re recruiting new people, they’re bringing them in, they’re welcoming them, making them feel at home, they’re introducing them to the content, they’re building wikis on how it all works. And so, you know, we’re lucky, we’re fortunate enough to plant some seeds and shaped the early stages of that environment to allow people to feel safe to come in and be creative, and to bring others into that environment. 

But from there, that’s something that community does, and we keep re-energizing it with their inspiration. And if you can keep that going, then then that’s going to change the world. Because like, people see that layer of what we’ve been building, because it’s the thing that is easy to get your head around in grass, but we’ve been building the infrastructure that sits below that iceberg for five years now. In order to get those outcomes, we talked about changing society. That’s really hard work, you can’t go on and you know, be part of a high phase, and get on Fiverr and make PFPs and make a billion dollars and hope to change the world next year, to build all that stuff takes a lot of time. And there’s been you know, dozens of people working behind the scenes before we introduce content to the equation, to make sure that when we go to that next stage, everything underneath their works smoothly, and we can reach more people and we can bring them on, and it’ll be a good experience for them. The content layer is the funnels to bring people into infrastructure. And so, gamifying with three infrastructures through content is really what the metaverse is about.

Taking Web3 Mainstream

So, when we caught up behind the scenes, you basically talked about like you have this thesis as a builder and an investor and it sort of falls under the category have one, how can we make it easy to access web three tech, and two, what are the funnels that bring in consumers into web three? And you brought up this interesting point of like, we got to move from infrastructure to content. And I want to dig into that for a minute. Because you’re right. I think a lot of the focus, if I’m understanding your thesis correctly, it’s like a lot of the infrastructure plays like people focus too much on the web three this, NFT That, right? And less about, like the benefits of what it can actually unlock. Right? Are you feeling the same way? And can you talk more about that?

Aaron McDonald: Yeah, I think, like, our job is to make the technology feel like magic. You know, like, people know, 99% of the world doesn’t actually know how email works. And that’s cool, because that’s the way it should be. And in web three, we kind of shove it in your face. You know, I was talking with a game studio today. That was they had gone through a backlash they built, you know, building this game out, and we’re starting to market it and they, you know, the gamer, the anti NFT gamer fraction, on their latest, you know, social justice cause came in and start to torpedo this project, really great team of people, building with really great motivations, actually building cool stuff. But because NFTs and crypto was in you know, in the face of those consumers, it became about that, not about the cool things they were doing. And we get like super zealous about infrastructure in a way that I think it’s unhealthy for mass adoption, it was useful in the early cycles, because that you needed that zealotry to get past an inflection point where this became and went from an idea to a thing, to a reality. We’re at that point now. And now we need to start making it invisible to consumers. 

And so, you know, when you onboard into Netflix, or whatever, no one knows what cloud infrastructure sits behind the scenes here. And you know, whose data scenes they’re using, and, you know, all the protocols that go into making payments work and user, you know, user logins and profiles where, no one cares, and they shouldn’t have to, and our job as technologists, is to make the technology invisible to them. And that’s been the focus of our work over the last five years, is how can you make the technology feel like magic and give consumers an experience that they couldn’t have before, make them, surprise them in that process. And then slowly, you know, like a Trojan horse, educate them about things like personal property ownership, okay, now you can do these things that you weren’t able to do before. And that means that you can try these new experiences, or you can have more control over you know, your information online and those kinds of things. But just don’t like shove it in their face, like give them something cool to play with. And then expose the infrastructure over time, as opposed to going in and saying, hey, web three, NFTs blockchains, smart contracts. Well, fuck off.

Current State of UX in Web3

Yeah, I think that’s, I think that’s a solid way to put it, I think on that too, is the second point is how can we make it easy to access web three tech, and that sort of falls under the category of how to solve the UX problems. And this is sort of the next conversation I want to have with you is, understanding the current state of like UX in web three. And what are the biggest mistakes that you see people making today? And some of the best practices you’ve seen sort of happen in real time?

Aaron McDonald: Yeah, I think like the personification of this, I think was when Game stop launched their NFT marketplace, and set out this, buying an NFT and eight easy steps. And I couldn’t tell if it was ironic or not, because we’ve had one account for like, 20 years with Amazon, so the idea that that’s what it takes to onboard a consumer is just eight easy steps. Cool. Let me book a day out in my diary to go do that. So, I think that’s the biggest thing is we need to make those initial onboarding funnels simple. And feel like you know, signing up to, you know, signing up to Amazon or whatever. And there’s two ways that that is being done currently. One is through centralized exchanges. So, they have a kind of a, you know, web tuition experience. And the other way is to build some cool protocols that you can do it natively within web three. The first way is a valid way to onboard people into the space. But I think it’s not flowing through to the real outcome that we want with web three, which is users are directly interacting with infrastructure themselves. And so, if you look at the number of people who own cryptocurrency, this is the number that have interacted with defi. And we say like, you know, crypto users who own cryptocurrency or early adopter mindset people let’s say, they’re risk takers, probably more than the general population, less than 5% of those people have interacted with the defi application. 

Crazy. 

Aaron McDonald: So, an early adopter set of a risk-taking set, we’ve managed to convince less than 5% of the users to actually migrate to interacting directly with web three infrastructure. And so, content has the opportunity, if we do it right to change that. I think if you look within our ecosystem, the way that silo is gamifying the underlying infrastructure of that communications protocol, is a really good example of how it should be done. And since launching the seekers and gamifying, the first stages of running a node in the network, we’ve seen 400%, more individuals running nodes in the network. And so, turning participation in web three into a game, I think, is a really good way for us to get more people involved with participation in the infrastructure and directly interacting with the applications on these networks. And that’s super important. Because if we don’t get everyone, we’re a large portion of society interacting directly. And we’re just going to create new middle mens. And those problems we have today, which has been a hand of a new set of people. So maybe the same set of people.

Understanding Adoption Funnels

Yeah, one thing you keep bringing up the keyword of funnels, right? Can you sort of elaborate more on what you mean by funnel as like a  podcaster? I have marketing tendencies, I think of like a marketing funnel to convert someone, right? That’s the first thing it comes from, are you defining that as a similar way? Or because you’re linking user experience with a better funnel, which very much in my definition, sort of links as well? Can you elaborate on that as well?

Aaron McDonald: Yeah, so a funnel. If we look at kind of the sets of funnels that may be exist within an ecosystem like ours, you’ve got the content itself as a funnel, people can interact with that, and just interact with the content, and then be pulled into interacting with applications and infrastructure. A funnel is the community. So, you know, people in the community can interact with other people, and they can pull them into, you know, into the infrastructure through those interactions. And then, increasingly for us, looking at audiences, so this is existing audiences that exist within the web two context for products or content that exist within the web two contents. How can we use those existing IP that have that audience and convert them into community members? By taking something, they already know and love and are interacting with and giving them a new experience with that. So, that’s when in my mind when I’m talking about funnels, it’s talking about using things that are less confronting, or more familiar to users as a way to get them into the community and then into being part of the infrastructure in application.

Got it. That makes a lot of sense. So, another thing we talked about behind the scenes is part of the funnel is it kind of splits into various categories, like there’s a mass market media funnel, the movie IP funnel, there’s the sports funnel, the music funnel, etc., all which sort of encompass the entire vision of the fluff ecosystem, right? And I think you guys have built such an incredible team just like doing just very brief research on who you guys are and what you guys have put together, you’ve sort of branched out to all these different channels and an integrated the IP in such an interesting way that it’s kind of hard to miss now. How have you done that? Like how have you guys managed to sort of tackle all those different angles, but also ensure that the community has a voice in it at the same time, without neglecting what people want, but also ensuring that, like, you know, what I mean, it’s such a, it’s a vehicle that’s moving in many different directions yet. I don’t know, I’m baffled. That’s all I can say.

Aaron McDonald: say that, like, every decision we make is the right decision. But every decision we make is with the right motivations, and you know, this is still highly experimental, and I can’t say that we’ve like, absolutely cracked the nut. But we have been thinking about it for a long time, and we’ve been thinking about it quite deeply. And so, what appears to be, you know, a short timeframe for a lot to happen actually isn’t and building up these kinds of networks of connections and people has taken years to achieve. And then those people are great people, and they can start to, you know, bring people and show them what we’re doing. And when we show them what we’re doing, they get excited, because it feels and looks different. And so that creates the opportunity to go and work with some of the world’s biggest brands, and each one of those categories, and start to say, hey, you know what? Despite what you’ve heard or seen about crypto culture, this is actually the future and there is a way that you can do this, that is authentic, and organic, and real. And when you have that conversation and show that to these people, they start to be believers, and then you can bring them on the journey with you. And take stuff they’ve been working on for a long time and give it a new age and give the ability for consumers to interact with that content in a different way. Your content is king is often a phrase that’s used. And it really is, if you’re talking about you know, bringing people into infrastructure always has been content, you think about, you know, those different hype cycles along the way. You know, starting from the internet, like content drove uptake of the Internet, content drove uptake of social media, content drove uptake of computing. Content is driving consumer interaction with artificial intelligence; you’re seeing this with mid journey and daily. And now, you know, thing is on the way, like all of these mediums, for engaging consumers or content driven experiences. And so, we picked the content buckets that we think are important to the future and gone out and got the world’s best partners, and each one of those to work with them to come up with ways to pull those users in.

Yay or Nay on CC0?

It’s actually quite fascinating. I think on that topic, too. I know we only have, we only have so much time left. I wanted to ask you a couple quick rounds and ask you some things from Twitter that people kind of commented on when I tweeted that I’m interviewing you. Okay, so the first thing is, yea or nay on CC zero community Commons license? Are you for it? Are you against it? What are your thoughts?

Aaron McDonald:  I mean, so our view and the view we’ve taken is that for any content that we produce, that’s our first party content. If you own the NFT, you own the content, and you can go and use that and monetize it. The only caveats we put on that is, don’t be a Nazi, don’t be a pedo. And, and as long as you’re not doing those things. And it’s another piece of the magic of web three in the metaverse because ownership. We talked about this right at the beginning, ownership is the thing that defines the metaverse, is being different from what we’ve had in web two. So, without it, then you can’t create the open Metaverse effect that we want. And also, as a creator. There’s a, the thing that drives these collections forward is the community’s activity and they wouldn’t be invested in doing it if they didn’t own it themselves. Angel baby would never have existed if Hume couldn’t own Angel baby. And so, if you don’t, if you don’t take that approach, I don’t think you can be calling yourself part of this movement, you have to give users control of content, so that they can go and create the community around it. In the olden days, in order to be successful in content and IP, you had to be a monopoly. Because it’s difficult to wrangle contracts and collect money and do all the things that are necessary to make it worthwhile investing and building that content in the first place. And so, you then tend to only contract with a small number of parties. And that can constrain your contracts the industry into a small number of people who control it. smart contracts, open the door for you to put content out there for others to take and build on top of it. And that monetization process that happens in the background, keeps feeding your ability to make more content without having to be a monopoly. And so, we can scale down to the, you know, the types of people that can participate in the content economy and make it worthwhile because of ownership, because community wouldn’t be involved in it if they didn’t own it.

Critics POV on CC0, Why Are So Many Not In Favor of the Model?

So, I remember when, what’s the project Moon Bots sort of announced that they’re going to CCO model, there’s a lot of backlashes around that. Can you share the critics point of view and why so many are not in favor of the CCO model?

Aaron McDonald: It’s a good question. What is the critic’s view? What do you think the critics here is?

I saw a couple tweet threads kind of talking about if everybody can use it, then it kind of loses 

Aaron McDonald: It devalues. 

Yeah, it loses its value. But on the contrary, though, I was in Cabo over the weekend, and there’s this model, old, old vintage model that people she has like the unibrow, I forgot her name, but everybody knows her for her unibrow. And people use that and commercialize that. And like, the more recognizable it is, the more it’s placed, right, the more it’s used, the more valuable it sort of becomes, right. But it builds brand equity. I don’t know if you could tie like financial value to it necessarily.

Aaron McDonald: It builds brand recognition. But I think, I mean, it’s hard for me to be a critic on the other side, and that is probably the only reasonable argument I’ve heard, which is does it dilute the brand value or the brand equity, might increase brand recognition but does its dilute value in equity. That’s the conversation the critics have. I just don’t even think it’s a starter. Like if you’re wanting to build an authentic web three way, to not have community ownership of the content, if otherwise just go build like something in the, you know, fortnight or some other like captured walled garden environment, it’s much easier, you’ll have more users able to onboard easily, you know, VCs, bucket of VCs that are invested as higher, like if you don’t actually believe in community ownership of infrastructure and in participation from a community perspective in developing IP, than just go build somewhere else. Yes, people are right, that there is only so much that can be done with that IP before it starts to lose some bit shine. You can’t be Lamborghini, and Toyota. Those, you know, you can’t be both of those things to consumers. And if more and more people are building on your IP, and it was premised on the idea of being Lamborghini, and it tries to transition being Toyota, that may be a bad path for it to go through. And so, it’s a viable criticism. If the goal is to create assets that are worth half a million dollars each. If the goal is to create Lamborghinis, then yes, you might have dilution because of community owners. If the goal is to create, you know, a thriving community of entrepreneurs that are successful in their own right, then it’s the only option.

What is the Size and Technical Capability of the Teams Working on the Futureverse?

Interesting, interesting. Okay. All right. All right. All right, next question. Okay, this one comes from trying to find it. All right, this one comes from Max poker 247. He’s like, ask him about the size and technical capability of the teams working on the Futureverse.

Aaron McDonald: Yeah, I mean, there is at least 200 people working on this and really, really great people, experts across protocol development, infrastructure security, you know, content engineering, content design, game development, game engineering, you name your favorite piece of movie or game IP. And we’ve got leaders from those businesses working for us. And it’s one of our superpowers actually, people kind of look at what has happened over the last 12 months and like, how the hell did you do all of that? Well, it’s because we’ve been around for a while, and we’ve managed to get this shit hot team that you know, is crazy good at what they do. So, the whole future this is powered by this engine of amazing minds and great people who are experts in each of those respective fields.

Outro

Okay, amazing. That’s all I have for you, Aaron, this was a really great conversation. Thank you for your time, before I let you go, where can we find you? And all the tags that you have in your Twitter bio, all the projects that you’re working on?

Aaron McDonald: Yeah, so just Aaron MCD in Zed, on Twitter is probably the best place to find me. It’s where I spend most of my time and you can reach out there if you want and follow along with what we’re doing.

Amazing. We’ll have to do this again soon. Thank you so much, till next time.

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