Working in crypto is hard. Product market fit comes and goes like the wind, and as we’ve seen recently the technology improves as prices increase. We wanted to put some thoughts out reflecting on the past year and the exciting year we have up ahead of us.

Our intent was to let what we are building speak for itself with no fluff. However, as we're approaching our one-year anniversary of the first ShardVault being live, this is the best time to reflect on what we've done, clearly communicate some of the decisions made, and what's coming up next in terms of what we're building.

As it is more than likely that some of the initial ShardVaults that we set up will get wound down via governance vote, this is the perfect opportunity to really dig into why we're building our new product and to explain why we decided to move away from the previous product that we built.

Thesis

With our new product, our goal is to create an on-chain game that enables users to win moonshots and cool opportunities from their favorite creators, communities, and brands. We want to create a user experience for winning on-chain value that's radically different from either trading or set-and-forget vault experiences. It's a real-time game that generates results in a provably fair way and is designed to be a fun, customizable gamba experience.

On one hand, users can win the exclusive, expensive, or otherwise unobtainable, while on the other side, accounts, and communities can list or create assets that users can win. It can be anything from an expensive PFP to an invite to a podcast or even a premium package from a content creator.

The experience is powered by $MINT. It's a token that people get every single time they play, and if you hold it, your $MINT balance increases whenever anyone else tries to win something on the platform. Right now, you can use $MINT to play for free, accrue yield, or swap out to ETH, but our vision is to make this into a stablecoin that denominates all of the prizes on the protocol and allows you to redeem for prizes (or, as Punter says, the Chuck-e-Cheese tokie of crypto).

ShardVaults

Before we dive into more detail on what's coming up next,  let's take a look at the past year and the thesis behind the ShardVaults. Our initial vision for the ShardVaults as a product was that it can act as an access layer to NFT finance - set-and-forget vaults that would allow users to get exposure to NFTs and NFT finance without having any trading expertise and without the need to actively manage their portfolio.

The plan was to build a Gearbox-style system where jpeg holders would deposit their NFTs to above-market returns, while shard holders would be giving those jpeg holders leverage through fractionalization. The ShardVault system was the first building block for that.

Recap

From a growth perspective, the ShardVaults were a success. During the depths of the bear market, we obtained over $2m TVL and gave our community the opportunity to get exposure to assets that they otherwise could not afford. We had solid collabs with artists who helped us generate the art for some of the initial collections that we launched followed by partnerships with some of the biggest NFT communities out there.

Bottlenecks

Our team loves talking to users. As a lot of our community members know, we take user research super seriously. The lack of choice, interactivity, and customization was one of the biggest pain points that we saw our users mentioning time and time again. Even if we had product-market fit for the base functionality of our initial vision and some of the ShardVaults launches went incredible in terms of community response, we were starting to realize that unless we radically change the product, we wouldn't be able to make the necessary changes that would enable the product to deliver the experience.

We were caught in a trilemma. If we wanted to provide yield-generation with NFTs via credit markets, we couldn't get a secondary market to function properly. On the other hand, any yield generation most likely would have had to be sacrificed to provide a healthy secondary market for Shards. Lastly, even if we somehow got the two to work together, in spite of all the integrations that we executed with lending primitives throughout the space, the borrow rates could not support passive yield generation except for a few collections.

The choice

There was an obvious choice. We could have changed our entire product and provided fractional exposure to art via fungible tokens. This implementation would have been very similar to NFTX or the novel Flooring Protocol. However, this would have been against some of the initial issues that we wanted to solve with the launch of our product - namely, can we build a set-and-forget experience that provides exposure to this asset class that does not require the user to be an active trader?

Fundamentally, that was so far away from what we initially set out to build that it didn't make sense. There is an amazing amount of great products on the market that enable their users to go long/short for specific collections - from perps (Nftper) to options (Wasabi), and even the previously mentioned Flooring Protocol, which has gained a significant amount of traction and is by far the most successful implementation of NFT fractionalization that we've seen.

Back to the drawing board

We knew from our user research that what our most engaged users ached the most for was an experience that had more variance. The lack of variance, choice and a sense of excitement when using the product was also a reason why we found it difficult to keep Shard holders engaged after the launch of a particular vault. Better yield and more collections would not have solved that design problem.

Our thinking changed about what we needed to deliver. What if we could find a way to allow people to get exposure to assets through variance and unlimited upside? What if we could find a way to deliver a system for real-time probabilistic auctions that could feel like a game? We knew that we didn't want to build a pure raffle or a lottery – that would have been boring.

We created prototypes, talked to people and started coding. Initially, we wanted users to receive fractionalized NFTs when playing, but a few conversations led us to believe that it would be awfully confusing for a lot of folks. Soon enough, we realized that we don't just have to be limited to art or NFTs entirely. The clearest solution was to create an (initially - wink) non-transferable token that users win every single time they play and where they get yield when others play, while also being to having depth to our experience. As Punter calls it, “The Chuck E. Cheese” token of on-chain loot boxes.  This is where the idea of $MINT came to be. Bit by bit, the pieces started coming together.

Getting it out

After revising the MVP a couple of times, we shipped it in about two months, with a pure focus on the demand-side. We weren't sure about PMF hence we wanted to learn whether it has potential as quickly as possible. A decision was made to keep it relatively low key as well - while the product is in a super early state, we didn't want people who didn't know about Insrt to interact with it and walk away with the wrong impression.

Our expectations have definitely been exceeded. In just eight weeks, we've gotten to six-figure gross gaming revenue with mid-five figures in protocol fees. People are messaging us telling us that they find what we're building addicting, but that they would like to see changes. Once we loop them into the concept of what we want to accomplish, they get even more excited. For our team, our metrics are better than anything we have done with the ShardVaults so far.

What's coming next?

We've learned a lot over the past few weeks and it's time to really double down on two things - making the product more engaging and complete, while really spreading the word around about what we're building and the value of $MINT. We have some exciting changes planned for the next several weeks that will provide more choice in terms of game modes for users, while also working on something particularly special.

Back when most of us started building in crypto, the idea of seamless onboarding to a consumer experience still seemed pretty far away. Our vision for the game is that anyone should be able to use it without having to connect a wallet or bridge between different chains, while being able to win prizes and accrue $MINT wherever they are. Stay tuned for an update on that.

On top of that, we're currently working on bringing in more prizes and assets on the platform - everything from art to some really wacky and fun stuff.

What about the current ShardVaults?

As many of you know, we've listed most of the ShardVaults up for a governance vote. Any ShardVaults that do not get liquidated - we will keep on supporting them, but we will not be actively developing or originating ShardVaults. We're a small team and spreading ourselves thin will mean that both products will stall. We're giving back all proceeds from ShardVaults to our community as a gesture of goodwill and have ensured that Shard holders have a path to get exposed to $MINT through the liquidation process. We encourage ShardVault users to participate in perpetual mints–it truly is a fun and novel experience!

Closing

From Insrt, we just wanted to say thank you to everyone who has been supporting us for the past year since the launch of the first ShardVault, especially those members of our community that have been providing us feedback on any build that we release and test out whatever we come up with. The next month is pivotal for us - we're closing the SV chapter and getting our new product out of an MVP state.