NFTs Will Upend Nearly Every Industry and Category of Commerce: Unhashed #25

For the 25th part of Unhashed, I reached out to Jeff Gluck, the CEO of the NFT minting platform, CXIP. So, let’s dive in.

Q1. Welcome to Unhashed. What’s your crypto story and what led you to work on CXIP Labs?

Answer: I have been an intellectual property lawyer for around 15 years specializing in IP litigation. I have been focusing on representing creators and enforcing their IP rights against corporations who use my clients’ work without permission. As the NFT space began to form, many of my artist-clients contacted me with a variety of IP issues and confusion which prompted me to dive in.

I became fascinated with the space and saw a lot of ecosystem fragmentation that I felt could be solved. This is what led me to founding CXIP Labs.

Q2. ‘Own your smart contract’, how valuable is this proposition for a layman? And how can one leverage it (monetarily or otherwise)?

Answer: This is a crucial proposition. Owning smart contracts is an extension of how crypto shifted the true ownership of digital assets to the users’ hands. With crypto, banks or investment vehicles are no longer needed to provide safe custody of our money. Similarly, it is only fair that the smart contracts themselves are owned completely by the creators.**

This also reflects the difference between having true creative ownership or not. Creators using shared centralized marketplace contracts have minimal to no control or ownership over the contracts. This pseudo-ownership, at scale, has the potential to derail the creator economy and is effectively an antithesis for decentralization. Web2 disguised as Web3.

These shared Smart contracts held in unison with these marketplaces are always a gamble. Creators must trust the centralized marketplace to prove their creations are theirs, and are often left with undistinguished provenance and broken royalties. This is why we are emphasizing that users own their smart contracts, and we build functionalities which can be easily accessible by them and are supportive to them. Cross-market royalties and on-chain provenance are two real-life use cases that can be leveraged by users.

Q3. How do you think the NFT community should mitigate the growing potential of theft, counterfeiting, and data loss?

Answer: For now, the community has done a great job of self-policing and the collective moral high ground has kept the NFT market, relative to what we’ve seen in DeFi, away from any major unlawful activity. However, there exists a prominent need for security measures and provenance authentication in the NFT market.

I also believe marketplaces should take more responsibility and create better and more secure systems to deter and mitigate counterfeit works. With the general public joining the bandwagon, the need for these security systems grow in importance and relevance. Multi-factor authentication, on-chain querying and verification are features that need to be equipped to secure the NFT economy.

An often overlooked issue in the NFT space is that of impermanence. Contrary to popular narratives, when a user mints or purchases an NFT, they don’t own the NFT in its truest sense. They only own the HTTP URL metadata file or the IPFS hash which are centralized by nature. **

This can be mitigated by decentralized storage systems where the metadata can be encrypted and stored. They also can be referenced on-chain to reduce counterfeiting. However, this is a tough journey that the NFT market, as a whole, needs to endure to mitigate the prevailing risks and potential of thefts.  This is why we store everything with IPFS and Arweave, to create a redundancy layer.

Q4. How does CXIP Labs intend to provide a universal minting process and standard for NFTs? Is that a viable aim considering it can be a single point of failure upon mass adoption?

Answer: CXIP views minting as a public good. Minting is a foundational infrastructure technology that should be designed in a way that facilitates and encourages interoperability across the web3 ecosystem. Siloed minting efforts are effective, but, in the longer run, they prove to be futile as they remain distant from the more inclusive Web3 ecosystem that is being built.

With that in mind, we are progressively decentralizing CXIP’s minting protocol to the creator community. This will allow creators to shape their own minting technology and create a base-layer that can become adopted widely. This is also an effort to decouple ecosystem growth from the core team.

Moreover, this effort further empowers the creators and users of the protocol to take ownership and build sustainable solutions. The benefits of this can be the minimizing of minting fragmentation and cross-market inconsistencies like royalty collection and provenance. A universal minting process opens the doors for many utilities to be built on top of it.

Q5. Please share your thoughts on DAOs and their potential in democratizing marketplaces while stressing on the feasibility of DAO-styled governance.

Answer: I sincerely believe in DAOs, their potential, and their future as replacements for legacy governance systems. They are incredible vehicles to empower communities to govern and shape protocols and achieve goals. The NFT economy has reached its current state on similar lines of public acceptance and inclusivity. Similarly, DAOs truly can democratize the way in which societies and industries evolve.

However, DAOs require true dedication and meaningful participation to become functional and sustainable. The initial kick start of a DAO needs to be bootstrapped and with time, they progressively achieve true decentralization. This initial friction is mainly due to the limited knowledge of DAOs amongst the general population.

As, and when, more people understand DAOs, their working, and potential, DAO-styled governance will be more feasible and sustainable. However, this scenario is easily a few years away which means the current landscape of DAOs needs to be sustained on the collective integrity of those involved.

Q6. What are your views on the future of NFTs? Apart from just being an investment opportunity and the current use cases, how do you think they will evolve in the next five or so years?

Answer: I’m extremely optimistic about the NFT economy and its future. I believe the NFT technology will upend nearly every industry and category of commerce. The seamless integration of the NFT-based economy with the conventional financial system will dictate the future.

Also, brands and institutions are showing interest and are adopting NFT based merchandise, collectibles, and more. I also believe this is how NFTs will decouple themselves from being perceived as an investment opportunity only. The creator economy is booming and NFTs can act as a catalyst in their growth.

In the next five years, NFTs will become ubiquitous and commonplace and we will see fundamental transformations across various facets of business and society. NFTs will evolve to be a basic necessity for a brand or a business, rather than being an exclusive feature. We need to adapt newer styles of commerce and trade as we move into an NFT-integrated society and economy.

Disclaimer: The sole purpose of Unhashed is to unhash (decode) information about projects innovating using blockchain and cryptocurrencies and share it with the community. The writer does not have any vested interest in any of the projects covered herein. Not that this article shares any, but still, taking investment advice from strangers on the internet is not a wise thing to do.