Dapper Labs’ Network Enables the Future of On-Chain Interactive Content

Dapper Labs’ network enables the future of on-chain interactive content CoinFund’s investment thesis for Dapper Labs and the Flow blockchain Links: Dapper Labs; NBA Top Shot; Flow Primer; CoinFund Portfolio Thesis Summary Dapper Labs is successfully building the network of choice for games, collectibles, and other interactive content via its Flow blockchain and associated token, $FLOW. NBA Top Shot is already demonstrating robust social traction, user engagement, and setting new records regularly in total volume and on a per transaction basis for their licensed game highlights (Moments), validating blockchain technology as an incremental driver of revenue for content. The Flow blockchain itself is technologically impressive and offers improved consensus, fees, off-chain compute, and programming language accessibility when compared to other popular blockchains. Near term, we expect intellectual property owners to eagerly look for new ways to monetize their library and leverage the Flow blockchain for these new business models. While Dapper Labs first made headlines for creating and popularizing CryptoKitties in 2017, its future is even brighter today thanks to its pivotal position enabling the tokenization, gamification, and financialization of a wide variety of intellectual property. Near term, the accelerating momentum of NBA Top Shot validates the monetization potential of blockchain-native experiences and motivates other content owners to explore onboarding their properties to the Flow ecosystem using a similar approach. At the same time, we are also seeing greater network effects materialize from a bottom-up perspective as new developers, brands, and users enjoy the comparative user experience and incentive alignment advantage the Flow network architecture offers versus older blockchain designs. Even with the shift to on-demand viewing demonstrated by Netflix and streaming services, the traditional content monetization model has remained unchanged for a century as consumers passively watch their favorite stories. Thanks to the unique advantages of blockchain technology in offering digital scarcity and ownership, this model is finally shifting towards a more active, bidirectional relationship driven by interactivity and community. Instead of just watching an exciting dunk, block, or 3-pointer on TV, Dapper Labs’ officially licensed NBA Top Shot platform lets fans collect, share, and trade limited edition Moments based on these actions, thereby enabling a new paradigm of active participation. NBA Top Shot has continued to set new volume records almost daily, with some Moments regularly selling at for over $10,000 each, and the current single sale record standing at the then-platform limit of $100,000 — tied by Moments featuring Zion Williamson and LeBron James. We believe that this early success has set the stage for even more intellectual property holders to leverage the Flow blockchain and its associated Cadence programming language in the future, incremental to the already-announced public partnerships with top entertainment brands and studios that include the UFC, Dr. Seuss, Ubisoft, and Turner. Source: http://cryptoslam.io/nba-top-shot as of February 22, 2021In addition to the content monetization potential, the Flow blockchain is technologically impressive and tailor-made for the large addressable market we just highlighted. Flow leverages a unique multi-role architecture for nodes that enables massive improvements in speed and throughput without sharding, and at the same time preserves a developer-friendly, ACID-compliant environment and enables full smart contract composability. While traditional blockchains force each node to store the entire state of the network and process every transaction, the Flow blockchain allows nodes to specialize in different roles depending on financial stake and hardware capabilities, enabling more efficient performance versus cost. Flow accounts also have full smart contract capabilities, making it easy for developers to provide superior user experience for onboarding traditional users, including offering free-to-play models, prepaid fees, and access recovery. These features, while standard in traditional web experiences, have been historically difficult to implement in the blockchain world. Finally, we are seeing signs of a growing community choosing to build on or integrate with the Flow blockchain, which has historically been one of the biggest challenges to overcome for emergent blockchains, representing meaningful de-risking for the future of the token and ecosystem. For example, Flow already has an active dialogue with developers through the Playground, Flow Alpha program, and Open World Builders efforts. The Cadence team has also collaborated with Facebook’s Move language efforts to ensure compatibility and optimization when run on the Flow network. On the projects side, Viv3 is a recently-launched NFT marketplace that lists not only Top Shot Moments, but a

Dapper Labs’ Network Enables the Future of On-Chain Interactive Content
Dapper Labs’ network enables the future of on-chain interactive content CoinFund’s investment thesis for Dapper Labs and the Flow blockchain Links: Dapper Labs; NBA Top Shot; Flow Primer; CoinFund Portfolio Thesis Summary Dapper Labs is successfully building the network of choice for games, collectibles, and other interactive content via its Flow blockchain and associated token, $FLOW. NBA Top Shot is already demonstrating robust social traction, user engagement, and setting new records regularly in total volume and on a per transaction basis for their licensed game highlights (Moments), validating blockchain technology as an incremental driver of revenue for content. The Flow blockchain itself is technologically impressive and offers improved consensus, fees, off-chain compute, and programming language accessibility when compared to other popular blockchains. Near term, we expect intellectual property owners to eagerly look for new ways to monetize their library and leverage the Flow blockchain for these new business models. While Dapper Labs first made headlines for creating and popularizing CryptoKitties in 2017, its future is even brighter today thanks to its pivotal position enabling the tokenization, gamification, and financialization of a wide variety of intellectual property. Near term, the accelerating momentum of NBA Top Shot validates the monetization potential of blockchain-native experiences and motivates other content owners to explore onboarding their properties to the Flow ecosystem using a similar approach. At the same time, we are also seeing greater network effects materialize from a bottom-up perspective as new developers, brands, and users enjoy the comparative user experience and incentive alignment advantage the Flow network architecture offers versus older blockchain designs. Even with the shift to on-demand viewing demonstrated by Netflix and streaming services, the traditional content monetization model has remained unchanged for a century as consumers passively watch their favorite stories. Thanks to the unique advantages of blockchain technology in offering digital scarcity and ownership, this model is finally shifting towards a more active, bidirectional relationship driven by interactivity and community. Instead of just watching an exciting dunk, block, or 3-pointer on TV, Dapper Labs’ officially licensed NBA Top Shot platform lets fans collect, share, and trade limited edition Moments based on these actions, thereby enabling a new paradigm of active participation. NBA Top Shot has continued to set new volume records almost daily, with some Moments regularly selling at for over $10,000 each, and the current single sale record standing at the then-platform limit of $100,000 — tied by Moments featuring Zion Williamson and LeBron James. We believe that this early success has set the stage for even more intellectual property holders to leverage the Flow blockchain and its associated Cadence programming language in the future, incremental to the already-announced public partnerships with top entertainment brands and studios that include the UFC, Dr. Seuss, Ubisoft, and Turner. Source: http://cryptoslam.io/nba-top-shot as of February 22, 2021In addition to the content monetization potential, the Flow blockchain is technologically impressive and tailor-made for the large addressable market we just highlighted. Flow leverages a unique multi-role architecture for nodes that enables massive improvements in speed and throughput without sharding, and at the same time preserves a developer-friendly, ACID-compliant environment and enables full smart contract composability. While traditional blockchains force each node to store the entire state of the network and process every transaction, the Flow blockchain allows nodes to specialize in different roles depending on financial stake and hardware capabilities, enabling more efficient performance versus cost. Flow accounts also have full smart contract capabilities, making it easy for developers to provide superior user experience for onboarding traditional users, including offering free-to-play models, prepaid fees, and access recovery. These features, while standard in traditional web experiences, have been historically difficult to implement in the blockchain world. Finally, we are seeing signs of a growing community choosing to build on or integrate with the Flow blockchain, which has historically been one of the biggest challenges to overcome for emergent blockchains, representing meaningful de-risking for the future of the token and ecosystem. For example, Flow already has an active dialogue with developers through the Playground, Flow Alpha program, and Open World Builders efforts. The Cadence team has also collaborated with Facebook’s Move language efforts to ensure compatibility and optimization when run on the Flow network. On the projects side, Viv3 is a recently-launched NFT marketplace that lists not only Top Shot Moments, but also original art drops and UFC collectibles. Chainmonsters is an upcoming cross-platform multiplayer online RPG inspired by Pokemon. FLOW-supported wallets are also on the rise, with Blocto and Ledger as two examples, while a growing list of exchanges already support Flow, and we expect more to follow. Similarly, we anticipate additional Flow-native projects such as new collectible issuance platforms, Esports tournament management tools, to emerge out of stealth over the course of 2021, which should further augment the network effects that are already starting to compound. Whether we’re following the Mandalorian’s efforts to deliver baby Yoda to safety or navigating the rough and tumble Western frontier in Red Dead Redemption 2, well-crafted narratives, rich worlds and believable characters are already table stakes in mainstream media experiences. In contrast, blockchain-native entertainment still generally lacks compelling content capable of elevating associated collecting and gaming activities. Dapper directly addresses this problem and has taken the lead in facilitating the engagement of existing, passionate fan bases starting with NBA Top Shot, although we anticipate its success to be a case study for additive engagement and monetization that other content owners are watching closely. We think of the near-term the opportunity set for Dapper Labs and Flow-based content monetization to be comparable to the $43B global film box office (2019 pre-pandemic), video gaming revenues of $140B for 2020, or the consumer products businesses of companies like Disney or Netflix, but the longer time value generation potential could be even greater if Dapper Labs’ technology suite and the Flow ecosystem continues to play a pivotal role in the transformation of our content and entertainment landscape as we move towards making the Metaverse an eventual reality. Disclaimer: The content provided on this site is for informational and discussion purposes only and should not be relied upon in connection with a particular investment decision or be construed as an offer, recommendation or solicitation regarding any investment. The author is not endorsing any company, project, or token discussed in this article. All information is presented here “as is,” without warranty of any kind, whether express or implied, and any forward-looking statements may turn out to be wrong. CoinFund Management LLC and its affiliates may have long or short positions in the tokens or projects discussed in this article. Dapper Labs’ Network Enables the Future of On-Chain Interactive Content was originally published in The CoinFund Blog on Medium, where people are continuing the conversation by highlighting and responding to this story.