How To Structure A Cultural Operating System

Introduction

If only Marshall McLuhan were alive today to see networked media integrate into the crypto economic stack via NFTs. Top down broadcasting is over. Tribal ownership of culture is back. It’s a transformative upgrade whose true power and possibility are barely understood. We could use McLuhan at a time like this. He’d have a field day exploring the technology and theorizing about its impact on society.

Here at the Starholder Institute we’re devoted to the study of emergent phenomena with the potential to reorient society. Crypto's breakout expansion beyond the economic realm into governance and culture hit our radar hard last year, setting off a firestorm of interest among researchers on the Exploration Team. Why people were so into apes, punks and squiggles went from an engrossing dinner table discussion into a vortex of full academic obsession.

As we listened, learned and debated, we found ourselves moving beyond the basic topics of number go up and is this a bubble. What we came to realize is that an open cultural operating system was being constructed by a decentralized community in an organic process of rapid iteration. A hivemind was operating with tribal intensity to usher in a revolution on par with the printing press, the television or even the internet itself. Networked media was about to change everything yet again.

Like so many others who’d gone down the rabbit hole only to find no bottom, we were overwhelmed by the endless directions to investigate. The institute could drop all other areas of study, expand its staff tenfold and still only scratch the surface. Instead of going broad, we decided to go deep on a single subject that hasn’t received much attention, storytelling. 

Why storytelling?

We started on this path one night after dinner in the cactus garden with the wine and mezcal flowing. The apes were at it again. No one can remember if it was dogs, or hoodies or mutants, whatever it was, their community was bursting with hyperbolic enthusiasm bordering on hubris. Hollywood awaited them. The tweets were flying, calling for a movie followed by a video game. Their aspirations struck us as incongruous. Why create this new cultural operating system full of potential, then settle for making yet another movie or game? Why break out of crypto into trad media when those mediums are so limiting relative to what was being built? 

We decided that it was a failure of imagination caused by short attention spans coming up with the obvious. Yet, our alternative wasn’t all that more inspired. World building from our normie point of view originates with fiction. Before there was fiction, there was myth which really is just community owned fiction in the oral tradition. Why not reconnect this tribal energy of NFTs into lived stories owned by all? Why not tell an epic tale on the Ethereum network?

Having established the superior snobbish position prone to postdocs a few too many cups into the night, we lounged smugly under the stars until someone realized that there is very little intersection between fiction and NFTs. The talent level in web3 is off the charts. The creativity is overflowing in abundance, but no one is doing long form storytelling with plot payoffs and emotional resonance in the NFT ecosystem. Everyone is too busy flipping penguin JPEGs to put in work at the root level of culture, storytelling. We decided that was going to be our project. Starholder was going to examine the systems, theory and opportunity space to cook up the right recipe for successful storytelling in web3.

Too bad we were too drunk to realize what a hard problem we’d settled on. 

How To Structure A Cultural Operating System

NFTs are network adapters that allow culture to plug into the crypto economic stack. Let’s unpack what we mean for a moment. A token is a tradeable unit in a global, permissionless, 24/7/365 marketplace. A non-fungible token is one that represents a unique asset. When you point a non-fungible token to a file and write metadata onchain describing that file, you are creating a representation of a cultural artifact that is now interoperable with the crypto economic stack. 

This link between finance and a discrete unit of culture is relatively simple to conceptualize because it has an analog to the traditional art market. A piece of art has value. It can be bought and sold. A receipt can represent the transfer of ownership from one party to the next. All we’ve done so far is digitize this process. We’ve established that NFTs are network adapters which allow art, culture and entertainment to interoperate with crypto economies.

What we’ve all learned in the last couple years is that NFTs plug into more than just marketplaces. They plug into an open source operating system called web3. NFTs are being used to represent membership in communities. They are being used to govern those communities. They are being used as distribution mechanisms and ways to bootstrap new social networks. They are acting as a form of identity where the ownership endpoint is fixed, but the application uses are plastic, upgradeable, and most importantly permissionless. Anyone on Ethereum can decide that an NFT is a key to their door.

NFTs are switchblade adapters that can plug into many application layers at once. Their superpower is that they can transform an unaffiliated collection of crypto protocols into the programmatic foundation of a cultural operating system. The metaphor of NFTs as network adapters for software is grounded in utility. One can see them in action and understand their power, but this is only the base layer of the cultural operating system which establishes how media can operate within a networked architecture. 

As the joke goes, we are in it for the art, so let's turn our attention to what an NFT represents. We acknowledge that an NFT is simply a file format and can be used to represent anything that is discrete from another object. NFTs can be financial instruments, they can commemorate attendance at an event with a POAP, they can be used as a ticket. For the sake of this topic, we  are excluding those use cases and are only focused on NFTs as cultural artifacts used in media and entertainment. 

NFTs consist of two components, the metadata and the media. Metadata describes properties of the media and are most useful in the cultural operating system as hierarchical sorting functions which give structure to the media’s placement within a larger networked project. The most familiar use of hierarchy is rarity within scarcity bound projects. 

There are 10,000 Cryptopunks. They are sorted by types (Alien, Ape, Zombie, Female, Male). They are further distinguished by the attribute types each punk has (hoodie, purple hat, mole, wild hair, etc…). Combining the type and the traits together reveals how rare a punk is within the collection. This rarity produces a multiplier over the floor value of a punk. It also and more importantly, describes the look and feel of a punk. 

While rarity is the primary use case for metadata today, it’s perhaps the least interesting when viewed in the context of a cultural operating system. Hierarchies can be better used to nest objects in collections. Properly done, metadata can dictate roles, location, group relationships, specializations and interests in a way that defines societies and organizations in worlds. This use of metadata allows an object in a networked media collection to establish connection points to its place within the world building IP of the project.

If you think of an NFT as providing access into a collection of crypto protocols moving downwards. Think of its metadata as providing its placement within the context of the creative world it lives in. 

Here’s an example of what we mean. Frodo is a hobbit. He lives in the Shire. He belongs to a group called the Fellowship. His role is the ringbearer. Each of these can be represented as metadata attached to a Frodo NFT. That attachment then conveys value, purpose and access downwards from the LOTR story universe onto Frodo. The book trilogy never needs to come on chain. All the Frodo NFT needs to inherit the cultural significance of the world’s IP and his place within it is to be minted by a wallet with an authoritative claim to the LOTR legacy. 

Now on to media which is the visual attraction point our brains need to contextualize an object. A picture is the preferred way for our mind to be introduced to a new thing. First impressions are often visual and we can imprint an entire range of associations with an object simply by seeing it. Is it friend or foe? If friend, what benefits can it offer us? If foe, how big a threat are we looking at?

Most media NFTs point to an image stored on the internet. There are billions of dollars in value trading through crypto marketplaces today based solely on the aesthetic properties of an image. This is the most common way NFTs are visualized, but also the least interesting because it is static and fragile (does not live on chain). 

Code is a more powerful way to generate the look of an NFT because it is extensible. Code generated NFTs and especially those stored on chain can be upgraded through accessories or morph their visual appearance in reaction to events taking place within a networked project (i.e. a story or game). This dynamism allows NFT holders to go from being passive collectors of a told story with a fixed endpoint to being active participants in a lived story whose arc is evolving in a feedback loop between the worldbuilding organizers and the participants driving the direction through their actions in the world.

The NFT sits at the midpoint acting as an access point downwards into the crypto application layer and upwards into the lore and universe of a story. It’s a two-way adapter at a high level, but as we’ve seen above, it branches out both up and downwards hitting many touchpoints in both directions. This is a crazy powerful capability which has not been fully unlocked yet. We’re spending a lot of time establishing this framework because it is the bedrock concept that the rest of the cookbook will operate on top of.

Where it starts to get really weird is that there is human emotion which gets overlaid on top of both the application layer and the worldbuilding lore of a story. This component is the most critical in the cultural operating system, but acts as a sort of a  hyperobject influenced by the collective vibe of the community. The value of an NFT is directed by both the emotional reaction of the audience to what’s been created and by the economic factors of the marketplace which assigns monetary value to the NFT as a digital asset. When an NFT is both part of a networked project still executing on its roadmap and a discrete tradeable object whose value is relative to the entire universe of NFTs, it is at the mercy of human emotion.

The real currency of the cultural operating system then is not ETH or any token that resides upon it, but attention. Attention is king in the NFT space. If a project cannot capture and hold attention, then its value in ETH will fall. When number goes down, interest goes down. A loss of interest spills into a devaluing of the story universe. There are less people living the story and their emotional payoff is tempered because their economic stake in the outcome has been diminished.

We believe that understanding this dynamic is critical and the core reason why no one has been successful at long form storytelling using web3 yet. Attention derives from value. The easiest way to increase value is to reward holders by issuing derivative NFTs which expand the market cap of the project. The focus then becomes on creating more network adapters rather than pushing the existing ones deeper into the application layer while also cementing the creative universe above them.

NFT projects today start in the middle of the operating system and get caught there because attention demands number go up. Rather than giving the genesis network adapter more utility at the application layer and more value as a cultural artifact, projects produce more adapters. Genesis NFTs create child NFTs, making NFT family management the center of attention. The largest projects can scale their way past this bottleneck by bringing on more resources to build out the up and down just in time. This will work for well capitalized projects with strong executional leadership, but can limit where the story goes. By existing prior to the story, the NFTs take on a life of their own. Attention centers there and it demands tending to the health (value) of the family first and foremost. 

An alternative approach is to build the roots of the application layer and creative IP in parallel and then release NFTs once some threshold of progress has been reached. This approach centers attention vertically into utility and lore rather than horizontally into child NFTs. Value is accrued by making connection points from the network adapter into the software stack and into the creative world. This is healthier as it aligns attention to long term progress. Teams that ship reward holders by upgrading the power of the NFT. Smart projects are embracing this approach to build sustainably.

We see this as the correct model for long term storytelling in web3, but not going far enough. The difference is that the outcome is in the hands of the project creators. The endpoint is likely fixed. NFT holders are audiences, with great projects they will become participants living the story, but they will lack true agency because there’s a third leg which is needed to make crypto-native long form storytelling its own distinct form of art. That is governance. 

A lived story is participatory on every level. Ownership of the asset needs to extend beyond an NFT into owning the direction of the application layer and story arc as well. This is where the cultural operating system can truly distinguish itself as an evolved medium of storytelling. 

If the economy and politics were separated, society would have an outlet for meaningful expression in a post-God world. Instead, we are only valued for our labor & purchasing power. Consumerism is the only acceptable expression. Stories are sold to us as a means of escape from this reality, but in their current form they too offer only an imaginary alternative without agency. The ends are scripted. The IP is owned by corporations which means that the choices you are exposed to are weighted by the profit potential of the product, not the quality of the work or the importance of its message.

Web3 long form storytelling can change that by weaving governance into the design of the story arc and application layer it’s built upon. Crypto has a robust toolkit for communal decision making, having thoughtfully developed methods of achieving consensus, operating DAOs and voting on protocol decisions. A cultural operating system can plug into these tools and traditions the same way that it can plug into a marketplace.

NFTs became a phenomenon by combining cultural and economic interests into a single object that can operate in a network architecture. So far, there’s little you can do with them except watch number go up. That’s changing as utility gets built out, but much of that utility is embracing traditional models of entertainment which all have top down story arcs with fixed endpoints. “Here is an entertaining maze, go run yourself through it and forget your troubles for a while.” That’s what’s on the near term horizon. There can be more than that though. We can live a story together where we are the audience and the actors, but more importantly, we write the next act together as the story unfolds. 

The ownership model that NFTs ushered in triggered a wave of tribal intensity and communal participation that hasn’t been seen in ages. Adding agency to that mix is going to be a gamechanger. We can find meaningful expression within consumerism by participating in public life together. This may sound shallow on the surface, but where can one feed the sacred self and nourish the desire to create something of meaning in a world which neuters expression? The time invested in entertainment does not have to be passive. It can be used to communally construct an immortality project, to leave a mark that is remembered throughout the ages. Governance enables real participation in the construction of our shared cultural heritage. 

Entertainment does not have to be passive, it can be empowering. This is how the cultural operating system can break through and define itself as a new form of art. This is the promise of lived stories with emotional resonance and plot payoffs. Long form storytelling can break the economic stranglehold NFTs have on attention by adding purpose and agency to ownership.

We’ve outlined how we view NFTs as the middle point and most visible output of an emerging cultural operating system. We’ve added governance as a theoretical missing ingredient that will elevate this operating system and allow it to expand from the limited entertainment experiences offered today to an art form delivering purpose and deep emotional response. Next, we will turn to the ingredients for creating a long form story on top of a cultural operating system. It’s going to be hard to communally build an epic myth in an age when no one has any attention, but we want to try. It can be done with the right recipe.

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