TL;DR: The “utility” & “network effects” valuation model for NFT’s undercuts their potential as digital cultural objects. Valuing NFT’s by attention capture incentivizes Clout chasing, creating toxicity between holder and founders. Culture is valuable because it creates new worlds by the patient work of community interrelation, shared experiences and collective imagination. Vital culture is rarely born online, it requires a high degree of context. As living memes, NFT’s can be the seeds of cultural > societal transformation, New cultures = New worlds. World Building is a value system that better realizes the value of NFT’s as cultural artifacts with the capacity to tell new stories about lifestyle, economy, and environments. World Building requires culturally embedded investment models, beginning with the reform of the VC model towards a “Medici” model.
How do we value culture?
Culture is the most valuable thing we have. We live by it, it structures how we associate. Our associational life is how we relate to the world, this ‘style’ for living is naturally applied to economic questions, we survive in the world according to how we associate with it and with ourselves.
Cultures represent our styles of living in the world, it is social and economic. It structures whether we simply survive, thrive, or fail at both. There is nothing more valuable. However, valuation of culture has long been insidiously contested, and confused paradigms for valuing culture have become prominent.
The centralized (web 2) valuation model for culture has naturally reigned supreme during era of global shareholderism. Simple as an assembly line, culture should be gatekept towards monoculture. This allows the owner of distribution and production rails to hoard the economic effects of a single culture upwards, maximizing profit by monopolistic control. Significant energy and cost is expended to maintain a firm chokehold on the cultural cash cows and to wrangle up and coming cultural movements into centralized distribution.
The stakes for how we value culture are enormous, this valuation is the incentive structure that determines whether individuals apply their time and talents towards culture building or take their talents to X corporate gatekeeper. it is the precise incentive structure for imagination- our human ability to influence our environment by our awareness. What gets valued gets measured, and what gets measured, gets done. In a society of gatekept culture, what incentive do we have to create?
If imagination is to have a real worth to us, it needs to have a practical, an economic, effect. It needs to establish us in our places with a practical respect for what is there besides ourselves.
-Wendell Berry
Ethereum’s decentralization of culture
Ethereum has taken the world by storm by creating a decentralized cultural value layer that is composable and successive. A digital reformation, It has removed the monopoly of middlemen profiting from the control of symbol- the building block of culture. Facing a brave new world of possibilities, most of us have not exercised enough creative courage, preferring to stay trapped in the skeumorphic, monetary obsessed paradigm of maximizing profit in valuing a new “cultural asset class”. What has democratized ownership and valuation of cultural objects enabled so far? 3-4 cycles of technical and speculative frenzy. Given the groundbreaking scope of cultural influence, it’s time to step up and develop a more imaginative framework for the valuation of decentralized culture, it’s time to set our sights on whats bigger so we can start aiming for it. We need a better framework for cultural value.
Utility + Hype = Network Effects
When we operate under the “attention driven” valuation of culture, we reaffirm the corporate philosophy that the cultural story is valuable because of the financial return that comes from dominating other stories. It’s a reductive regard for the dimensional nature of attention, and requires a consistent capture of attention by a bait and switch game we call “utility”.
The utility valuation of NFT’s as cultural objects seems borrowed from the way we value fungible ERC 20 blockchain tokens- “network effects” of adoption. The Metcalfe’s law “network effects” thesis touted by professional investors charts well, and very well may explain how to value Bitcoin. But we are discussing the “unique” tokens. In NFT land, utility has been the primary way a network has colonized attention to create exponential network effects by “engagement”, a low context and base form of association. This has resulted in BAYC, it also has resulted in a ecosystem of exit hungry VC’s, rampant Hacks, perpetual ponzis, rug pulls, and a ‘wen’ culture among holders that expects the world from founders in a digital space with very little context to moderate itself from extremity.
The framework’s economic effect creates few big winners and many losers in its excessive focus on linear financialization. Its associational effects endorse a “community” of mini corporations with many shareholders, operating under the same monopolistic financial paradigm (rate hikes go boom, nft get rekt). If we are being honest, the web 3 utility framework rewards clout chasing , not culture. It neglects to address culture’s influence as a living style by which we as multidimensional beings attend, live and work in the universe
Is Life a Network Effect?
While it is undeniable that digital living (metaverse) is upon us, embracing the utility-network effects valuation of culture inevitably endorses “life by subscription” which is by nature passive, and “speculative”. It only values attention insofar it is expressed in “engagement” , number go up, and hype. This is a brute valuation of attention that confuses profit with value creation. If we evaluate a place by what people do in that place, The metaverse will be a place where your life is reduced to a network effect.
It is more valuable for us to engender the worlds that engender our consensus structures of economies and societies, rather than capitalize on a short term bias of clout driven attention. We must understand cultural objects express socio-economic values, not opportunity for just financial profits. Thus, it’s incumbent on us to realize the whole implication of attention. If we only focus on the “growth” of digital networks driven by digital only network effects , we are stripping the same mine of attention as the corporate monopolies. Technology is developmental, it shapes people’s lives.
NFT’s are living memes
The technical frontier of NFT’s is vast , like the discovery of the new world, it’s a territory plentiful for infinite elaborations. The notion of NFT’s as interfaces or digital objects is rising quickly to prominence
The existence of digital cultural objects necessarily creates a competitions (of memes) to seed winning cultural ecosystems, the scope of these questions is the scope of humanities existence in the world they are social, political, historical, philosophical. How can we pretend these seeds are for making fast cash via internet clout?
“Ideas are made of memes. The art community [should think of itself] an environment modeled after the natural environment where we are attempting to create memes which enter an environment of other memes, which are in competition with each other. Out of this competition of memes, ever more appropriate, adapted and suitable ideas can gather and link themselves together into higher and higher organisms.
-Terrence Mckenna
Art, Stories, are cultural objects which play a direct role in our associational life, they structure them and harness the economic power of consensus to meet our localized needs. The questions that remain are about us, not NFT’s. What ideas & subjects are most worth representing with these cultural objects? What higher organisms will be more successive, valuable, and adapted than our current organisms?
The best stories (memes) become environments, this makes IRL the elephant in the metaversal room. Because of culture’s social dimension, NFT’s will require an offchain bridge, or framework that applies these digital objects to real world subjects. After all, the IRL consensus superstructures of economy, society, and lifestyle are made possible by consensus on culture defining stories…. which are intangible cultural objects.
Lifestyles , Economies, Environments: “Stories we live in”
What is the TAM of culture? We all live inside of stories, tangibly and intangibly. Living stories justify why we live, who we are, and how we may be of use in a particular place. The power of stories is the social power of collective attention, which always carries economic implications (value), stories bridge us into the world- they define how we order ourselves (economy) and how we may be of use in the world. Just as text is inseparable from context, stories are inseparable from economic effects. They order us for consensus by social trust.
The Kardashian story is meaningful for some, and they orient attention towards certain economic effects . American Manifest Destiny, trickle down economics, and Bored Ape Yacht club were stories meaningful for some, and they each oriented attention towards certain economic effects.
If we are to fully realize the value of decentralized culture, we must return to stories about living, the stories which tell us how we as individuals live successively in the world. We must create and tell new stories of local adaptation and succession- the stories which deserve the full value of attention realized by the meeting of our intangible and tangible needs.
By the same process that soil collects life , death, organic matter and nutrients to build fertility from which new life comes, a human culture also collects life, decay, death by symbol and story to build a fertile memory of itself, from which new life comes. A “living” culture is enriched by the stories of how “life” succeeds , it preserves these stories and carries it forward towards innumerably abundant and diverse fractals of that same life.
The linguistic patterns of our stories shape our investments of attention and money at every scale with a repeating pattern (fractal). How much value is generated (financial or non financial) by the story of the United States? How much territory and manpower is commanded under its flag? The value of being able to compose and own these living stories is priceless and spans generations.
Decentralized culture also implies the decentralized ownership of the economic effects of stories. To fully realize the value of this decentralization is to put storytelling and its economic effects back into the ownership of those who live in the subject from where the stories were made. This imperative for cultural objects is for the world builders to be the world owners. A holistic imperative of representation of the living stories , histories, and memories of the ways individuals and communities live in their place, a myriad of narratives telling a new story of a new settling of the world.
We must look to the world and its infinite garden of cultural subjects to truly capture the potential of Ethereum as the infinite garden of cultural objects. The opportunity to build protocols that onboard off-chain societal construction into sovereignly owned networks awaits. The reality of living memes implies a new look at living stories, which require a new look at ourselves, and our environments as cultural proving ground. This is a transcendental imperative. The transcendental tradition focuses on the individual and the society born from his relations to himself, others, and nature.
For us to achieve a renaissance from NFT’s we need artists to have some creative courage about a program to reform society and art’s role in healing the soul of people by describing them and their world in a way that reconnects their life to the story they live within. Collective imagination led by collective symbol making is the only way that culture re-emerges to challenge the ideological stories that cleaaaaarly aren’t working for us. Art led the renaissance, but what was rebirthed was society.
The scarcest and most non fungible things are unique people in unique places. The symbol makers are the ones closest to the people and their living styles- they are like priests, translating the aesthetic and organizational language of people emergently elaborating into memes more or less representative, more or less helpful to that context, or more or less damaging to that context. It’s a supreme calling to be an artist and even more so in our era.
As associational life unfolds as a “New World”, we require World Builders working vigorously and particularly by the force of imagination. This force reveals the value of owning our culture, that we own the logic of our distributional and habitational structures. More simply, the value of culture is it allows us to become one with the world around us in our own, unique way, to fashion a new world by the power of collective interrelation and imagination.
Imagination, amply living in a place, brings what we want and what we have ever closer to being the same. It is the power that can save us from the prevailing insinuation that our place, our house, our spouse, and our automobile are not good enough.
- Wendell Berry
Building on the technical model for valuing hyperstructures, I propose that World Building is a framework for cultural value that will allow us to value (thus create) social protocols to go with our current technical ones for the purpose of elaborating culture that makes one whole thing of the world and ourselves through the vectors of lifestyle, economy and environment. World Building by networks will enable networks to create fractal , successive and cyclical value by owning their own narrative.
New Cultures, New Worlds
Culture is not a new asset class, it is a structurally new asset class. It is closer to part ownership of a village than the whole ownership of a stock. These villages in the form of networks are alive, and are constantly co-constructing symbols that represent their interrelation with each other, with the village overall, and with themselves. By the distributed ownership of these networks, interrelation is valued, since each member creates, curates and owns the digital cultural objects which represent these forms of interrelation. Simply put, the practice of human and ecological interrelation by collective imagination creates new shared worlds , ripe for the building.
World Building is transforming our stories into our environments, and the conviction that we ought to own the stories we live in. It is the call to imagination and the imperative that society itself is up for grabs, it is the chance we’ve always been waiting for. The imperative should form a banner covering a scope broad enough to address the restructuring of living stories- principal are associational, media, developmental. World Building requires a cultural template of collective imagination, intelligence, and storytelling , resetting artists and symbol makers in a context of cultural production. A diverse environment producing ever better fitting memes of a particular place and particular people. The only way our symbols will be precise is if our knowledge is precise, which usually comes by experiential knowledge called wisdom, we require embodied thought in context, which is action. Living is a communal action.
We must embrace the slow work and philosophy of gardening , which is at once seasonal and patient, enriching itself by collective nutrition and coherence. The production value of a garden is not all fruit, it’s the discipline, virtue, and wisdom gained by the gardener. Gardening prepares us to properly value and enjoy the fruit. By seeing the bigger picture we realize that maximizing profit is exhaustion, and it’s better to dance in rhythms of rest and creation. When we work together there is always enough, we must embrace the fact that “some things, though limited, may be inexhaustible”.
VC’s > Medici’s
Updating the valuation model for cultural objects requires updating the entire apparatus of network & enterprise production. First should be the mechanisms for investing and developing in cultural projects using decentralized stacks. It is impossible to invest in world building with the same venture structure, timelines, deal flow term sheets that propelled web 2 and currently propelling web 3 (into another version of web 2). This is because new cultures and new worlds are both associational* & *economic, implying a role for character and cultural embedding. Further, it requires a balancing of economic interests with cultural vitality by the knowledge that the prosperity of the investment should be a result of the prosperity of the community. A knowledge that in a shared context, trust begets trustworthiness.
While abstract interest in a growing culture and community may make you rich, it is the local optima. Ultimately, it is holding new cultures and new worlds back. It remains true that “no community of medieval bandits ever led a more unlovely life [than those] who solely elevate the materialist ideal”. and “The merely commercial idea, is in its very essence debasing and lowering, it is as true now as ever that no man shall live on bread alone”. [1]
The difference between simply rich people and great people are that great people understand the value of human life beyond its productive capacity and fight for the contexts which may not be financially measurable yet are vitality indispensable. New worlds will require a nobility of character. What nobility is in colonizing the attention of your neighbor which is owed to their subject? Without the paying the attention that is owed, our subjects become endangered, endangering us.
The VC might be reimagined as a “founding father” or “Medici patron” archetype, moderated and informed by the same localized context which other members of the community are informed. Most of all, the Medici should understand that economy (among other things) comes from culture, not the other way around. Investment parameters will need to be restructured by the knowledge of the value of the gardening virtues necessary to nurture new worlds. Cultural embedding is the only manner for capital to gain the restraints of humanity. By valuing culture as that which structures economy (and subsequent ventures), the Medici learns to view ROI in terms of legacy, a legacy that by being culturally intact is able to prosper itself from the inside out economically. We must leave hype, abstraction and short term exits and embrace seeding sequoias. Learn to seed the genesis growth of a forest, one whose logic is to successively expand and sustain life from the inside out, forever.
Far from being unprofitable, this model will benefit from not only the success of a venture, but the success of an entire economy and legacy of ventures all framed by the culture it seeded. The value proposition of new cultures and new worlds is thoroughly human, and its harvests are not only material, but also in the priceless value of hearts and minds, memory and legacy.
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Cultures are the stories from which worlds are built. Which stories deserve to become worlds? Time will tell, we have been working on one worth telling, it’s called seasons.
[1] Roosevelt, Theodore. American Ideals: And Other Essays, Social and Political . Kindle Edition.