“Fantasy Hollywood” — Crypto and Community-Owned Characters - a16z crypto

Today, crypto technologies like decentralized autonomous organizations (DAOs) and non-fungible tokens (NFTs) enable a new model of character development and ownership that could not only unbundle creative media, but also lower the barrier to entry for online communities to bring new characters into the world.

Of course, it’s not all fun and games, either — DAOs, after all, are not just an abstract crypto concept, but systems of people. And while they create new models for human coordination around shared principles or goals, they also present new challenges for effective governance, day-to-day execution, and scaling.

Today, most successful characters exist as intellectual property owned by a single corporation. This means that fans don’t have any governance, let alone direct ownership, of these characters, limiting them to being only passive consumers of the products and narratives that the corporation decides to create. Even if fans buy public equity in the co... See more

How will DAOs convert revenue generated from character IP off-chain back into the on-chain treasury? The sale of NFTs enables an easy way to fund an on-chain treasury that can be managed by token holders. But DAOs may need third-party administrators that can provide payments and contract services at the direction of the DAO to bridge off-chain (e.g... See more

The next iteration of DAOs is therefore emerging around creative communities, to enable crowdsourced creativity and coordination (aka “creator DAOs” and similar).

The communities could distribute governance tokens to the holders of character NFTs, which in turn can be used to vote on key creative decisions. Such collaborative relationships between creator and community are already happening and will only increase as participants explore the possibilities, both creative (including governance) and financial.