It's no secret people love to collect: shoes, watches, cards, cars, tinder matches? In some cases, countries. This year, Covid turned some of us into toilet paper collectors.
Nearly all of us have some kind of collection. Most notably for me growing up, were cards, Football, Pokémon, Digimon, Yu-Gi-Oh, Magic: the Gathering. Trading in the playground was a daily routine. Some of the earliest recorded collected cards were baseball cards found in cigarette packets! Intended initially for advertisement, smokers quickly began collecting them.
Below is considered to be one of the rarest and most valuable baseball cards ever produced. It depicts Honus Wagner, one of the era's greats. The card was issued by American Tobacco Company from 1909 to 1911 as part of the T206 series. He refused further production, either because he wanted more compensation, or didn't want children buying cigarettes to access his card, I'd like to think the latter.
In the last 90 days, the world has seen a huge resurgence in interest in Pokémon cards. Perhaps because we're bored at home, or perhaps a mania led by influential YouTubers and Superstars, maybe a mix of both.
Cards have made headlines, as YouTube and Music stars race to "open packs" on stream and on video - hoping for a valuable card. This drives further speculation, especially amongst young people, but adults are no strangers to collecting as we've explored above.
The record for the most expensive Pokémon card to be auctioned, an Illustrator Pikachu, went for $233,000.
It's a big part of all of our lives at some stage, it just evolves. Now we are witnessing a change in the
that we collect.
Collecting is (slowly) going digital.
With the evolution of technology we've seen many attempts to break through to Digital Collectibles. Digital Collectible Card Games was estimated as a$1.3bn market back in 2013. But they never really took off. People seem to prefer physical cards. But Digital Collectibles? Or 'Digibles' show more potential with the emergence of Augmented Reality.
Augmented Reality (AR) collecting saw it's first real boom in 2017 when Pokémon Go, an AR collecting game took the world by storm.
Reaching 60 million monthly users soon after launch in June 2017, 12 million of which were using the app daily. But numbers definitely dropped off slowly. A slow release of Pokémon meant it was hard or even impossible to fill your Pokédex, and you had to play consistently over a long time. As player numbers reduced, it became harder to find groups for "legendary raids" and therefore numbers fell more aggressively.
The most popular region remains extremely active in the world of Pokémon Go - Asia Pacific. Seeing year on year growth since 2016, with over 310 million users at present.
AR Collecting is alive and well, but Virtual Reality (VR) is lagging behind. Likely due to the fact VR is for the few rather than the many and we're very early in the technology. It's more immersive, but more expensive, and has a bigger learning curve.
We'll dive more into VR later as we go down the technology rabbit hole.
Blockchains and other Distributed Ledger Technologies (DLTs) - like Ethereum - set precedent for a new way of collecting and also tracking digital assets, they offer tools to create scarcity, prove authenticity, and offer the foundations for fair and effective collecting systems, and as we move forward, displaying & sharing systems too.
CryptoKitties are Ethereum based collectibles that you can breed. The below, named 'Dragon', sold for a record breaking $170,000, which, if you recall from earlier, isn't far off the the Illustrator Pikachu.
Assets like CryptoKitties that are issued on a blockchain are paired with a token that represents the item's uniqueness. This token stores important data like history of ownership, also known as provenance. Traditional collectibles don't benefit from this. These particular tokens, and in the following case, Kitties, are called Non-Fungible Tokens (NFT's).
CryptoKitties was likely an onset of the Bitcoin Mania and Cryptocurrency Bullrun of 2017, but we shouldn't ignore it. It had all the elements of a great collectibles game; a mix of chance & luck, and driven by a cost requirement. People love "unboxing" and "unwrapping" - and this is why breeding made the winning combo.
Unfortunately for Cryptokitties, Ethereum just wasn't mature enough - and the barriers to entry into cryptocurrency are still covered with razorwire. It was good for people comfortable paying a lot of money just to interact with Ethereum, and people who already understood cryptocurrency, but absolutely nobody else. As improvements are made to Ethereum, and onboarding and user experience becomes easier, we can expect another resurgence in CryptoKitties - but we're a way off.
Zed Run is another notable collectible ecosystem that recently migrated to NEAR Protocol (a protocol similar to Ethereum, with much cheaper and faster transactions) to ensure that when users do come, they aren't put off by a clunky experience. Zed still sits into that niche crypto-collector community, but I do expect it'll have its upside one day.
Zed allows the breeding and racing of digital horses. It's a game likely aimed at an older generation of players and gamblers alike, that offers large prize pools ($80,000 at the time of writing) and rare horse coats that can fetch tens of thousands of dollars, particularly during peaks in speculative cycles.
We've explored collectibles like cards today, but there are many other use cases for digital collectibles and NFT's.
If you understand even at a very high level of how a blockchain works, and I did a half good job of explaining what an NFT is, you should now understand that merely copy and pasting an image of the famous CryptoKitty, Dragon, (or any other image) does absolutely not give you ownership...
...Just like reprinting the Illustrator Pikachu card doesn't mean you can sell it for $233,000.
People love Scarcity. Certification. Clout. We explored that earlier, and it's at the heart of human history, since 12,000 years ago when we formed our first settlements, we've been collectors.
With the parabolic growth and evolution of the internet, there are new ways to provably track, exchange and monitor both physical and digital assets.
And it sets precedent for more blurred lines between the real world and the digital world...
Something that you should all find interesting is the emergence of the Metaverse. That's where you'll be collecting things soon, if you aren't already.
The Metaverse is a collective virtual shared space, created by the convergence of virtually enhanced physical reality and physically persistent virtual space, including the sum of all virtual worlds, augmented reality, and the Internet.
Nevermind websites, we're quickly entering a world full of webspaces. I wrote about that here. "Fortnite, Animal Crossing, and the Metaverse."
Web spaces, areas that make up the open metaverse, can be any area of the internet we connect digitally that might resemble the real world, or encourage behaviour similar to the real world. In the article above, I used the example of Animal Crossing & Fortnite. These are areas of the metaverse because they allow human like interaction and encourage us to behave similarly to how we would in real life. You collect skins to show off, instead of clothes.
Some webspaces are likely to replace websites - areas we can browse freely, and even purchase real & digital items while we do so. If you wrap in other areas of technology, like augmented and virtual reality, you create a really interesting way for people to connect with brands, artists, and eachother.
A remarkably successful example of a digital webspace built on Blockchain technology is Decentraland. The first ever world owned entirely by its users. When you buy land in Decentraland, you really do own it. The native currency to the virtual world is called MANA. A plot of land named "The Secret of Satoshis Tea Garden" was sold for over $80,000 equivalent in MANA tokens.
I hopped into Decentraland to explore, after heading over to the Museum District, I was naturally drawn toward this exhibition, for some reason.
Decentraland is by any standard, a breathtaking example of decentralisation in action - owned by its users, and highly immersive, It shows great potential in the ability to buy and monetise a world through NFTs. After raising $24m for it's native Ethereum based token, MANA, back in 2017, it's had an impressive climb and built a cult like crypto userbase.
It's extremely easy to log in and get started if you have a Metamask wallet (a web based wallet for interacting with the Ethereum blockchain) and very easy to move around in, but it feels overwhelming and lacks the tools to direct the users to the right place - but perhaps that's the idea? A vast, open, decentralised world to explore for the first time.
Where it falls short, however, is that it feels massively ahead of its time. While I expect it has the ability to mature like a fine wine, particularly graphically, it just doesn't get the love or recognition it deserves. Decentraland is also yet to support VR, and is failing to draw the real user numbers it needs to hit the mainstream.
Decentraland sits at that niche intersection between Virtual Reality and Blockchain, and will probably remain there, and there is nothing wrong with that.
The Evolution of Augmented & Virtual Reality is right now at a turning point - and largely accelerated by Covid19. It's also complimented exceptionally by other areas of deep tech that we've explored, like Blockchains and NFTs.
So where do all these concepts come together?
Terra Virtua (beta) is a Mobile, PC, & Web based Platform & Ecosystem for Digital Collectibles that supports Virtual & Augmented Reality. They're not the first digital collectibles platform to use DLT, or NFTs, but the way they uniquely combine elements of collecting, trading, fandom and merch with unique webspaces makes the potential for them to emerge as the global standard of digital collectibles very possible.
The Ecosystem itself is made up of a number of areas. A marketplace for buying and selling licensed assets, an art gallery, "fancaves" (that resemble a house for displaying your collections), the Terradome (that resembles an exhibition centre) and an AR mobile app that is not yet released.
The Terra Virtua team exhibit a deep understanding of the emerging Metaverse and virtual shared spaces; they've bought together collect, share and display, but in a way that funnels the users to the right environment. It also encourages mass market participation through standard dollar pricing models (rather than in cryptocurrency), and partnerships with big licensed brands.
Terra Virtua is built on Unreal Engine and operates in its current form as a Desktop Application. It feels smooth, offers a high definition viewing experience and feels like an immersive, first person game.
The Marketplace is a little bare in its current state, particularly on the collectibles side. That said, there are plans to add many more digital collectibles, and that is demonstrated by the awarded partnerships and licenses. For me to really want to build collections in Terra Virtua, there need to be more assets that really resonate with me, and I expect this is the key to winning the mass market.
One thing I did find, was a beautiful piece from Amrita Sethi, which I bought to display in my Terra Art Gallery (bottom right)
The Art Gallery does what it intends. It feels (and sounds) like a real life gallery, minus the glass of champagne. Soon, you'll be able to go and visit other galleries, and in the not so distant future, I expect real-world museums to be showcasing digital versions of their art in webspaces like Terra Virtua. I'm looking forward to lending out this piece.
The Fancave (pictured above) looks and feels like a house. You can decorate it with assets purchased in the Marketplace, when I entered, a movie trailer for Top Gun was playing on the Television - likely an indication of some upcoming Top Gun collectibles and memorabilia, I was a little disappointed I couldn't go upstairs, but I am sure that will be added in the future.
The Terradome is unique in that it's a much wider, open space, ideal for showing off your larger collectibles, that won't fit in the house (fancave). Think spaceships, aliens, and even sculptures. The AR mobile app isn't live yet, but I'll make sure I report back when I can use it. I expect it to work similarly to Pokémon Go in some respects, but replicable for any brand, artist or asset.
A world where you can collect on the move, unlock discounts, even secret flash sales.
The Fancave even had records on the wall, and I can't help but imagine myself rushing to buy a limited edition Kendrick Lamar album to play in the Metaverse.
As the world moves more online, so do all elements of our day to day lives.
From movies to music, the world, and our collections, are going digital. Now, you can even try shoes on in AR. How long before you can wear them in shared web spaces?
Terra Virtua feels like a unification of most of the technologies I've been exploring since I entered the DLT wormhole back in 2016, and I have no shortage of ideas on how it can scale.
The trick, of course, will be educating the mass market to this emerging asset class, and doing so by speaking to that part of us that creates, collects, and shares with others. It's a tall order, but one I can get behind.
Disclaimer: I am the owner of Pokémon Cards, CryptoKitties, Zed Horses, MANA tokens, and most recently a proud advisor to the Terra Virtua team.