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Published 21 Nov 2021
1/🧵On evaluating NFT influencers and investors by the projects they talk about, in the web3 context.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
I want to build onto @Loopifyyy's thread earlier ( https://t.co/6Z7lOEjvqN ) and this concept of "hot potato" projects.
Everyone in NFTs knows those highly desirable projects.
2/They're the projects that gets everyone on NFT Twitter talking about them, with a bajillion users on the Discord, where the hype is unbelievable, mint sells out in 2 seconds flat, and the price shoots up.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
The projects everyone hopes to be lucky to have minted or bought early.
3/Often, they are launched by anonymous founders. Maybe they have some hot "influencers" on board. "The art is great," everyone says as they pass secret recipes for whitelist spots around.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
These projects, somehow, do their marketing extremely well, and it pays off.
4/The mint opens, and the price rockets up. Who can resist? Who doesn't want to 10x or 100x their money in days? It's a dream come true. It's what we all hope to be lucky enough to stumble upon, right? WAGMI by buying one of those projects early some day.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
5/At some point, usually just before reveal or some other momentous, looked-to event, the project reaches a crescendo of hype and the price reaches the stratosphere. At that point the smart people with impeccable timing sell everything and pocket their winnings.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
6/A rags to riches success story of web3?
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
Hold on a second.
What about the folks who bought an 8eth Meka pre-reveal? Are they gonna make it too? After losing about $30k in a few days? They'll make it back on the next one, perhaps?
7/Most of us in this space hope to be lucky enough to get into one of those projects and turn 0.1 eth into 10 eth and give ourselves a well deserved pat on the back, but should we?
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
What exactly are we building here?
8/Anyone following my tweets know I'm convinced that web3 will change the world for the better in countless ways, and I'm really excited to witness and be part of that story.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
But you probably also know that I like to call things by what they are.
9/The latest hype train to leave the station is the Wolf and Sheep game. And it's brilliant, because it serves as a microcosm of what is happening across the NFT space, which @sxtvik observes in this tweet. https://t.co/nfkDTGxOkh
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
10/As beautifully dissected by @azfnft, this game is, fundamentally, just a redistribution machine. It's a mad overhyped casino where fortunes are made and lost based on rolls of the dice. And it's "the hot thing" in the NFT space today.https://t.co/SHleXpUp7r
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
11/But at the end of the day, those redistribution machines, as I've examined before, are unsustainable. They rely on the hype and constant influx of new investors to keep humming along. Money in = money out. https://t.co/4MUJJYCZ1Q
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
12/The reason these things are illegal (or at least tightly regulated) in the rest of the world is because inevitably, the hype runs out. And even if it doesn't, eventually you run out of people willing to pour ever increasing amounts of money into the redistribution machine.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
13/And the moment that happens, the whole thing comes crashing down. And then some poor sod just like yourself (or maybe, this round, it is you) is left holding NFTs they paid tens of thousands of dollars that rapidly plummet to zero.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
14/In Accelerando, @cstross described far-future civilisations as having become overrun by sentient ponzi schemes and other aggressive commercial entities, constantly fighting with each other for scraps of scarcity.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
Feels a lot like the NFT space these days, no?
15/Is this the bright future web3 promises to build for us?
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
Fuck no.
16/Web3 is about decentralising and distributing the economic/incentives layer of society, creating new models of collaboration and governance, enabling trustless collaboration on vast scales... and many other things both known and yet unknown.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
17/So, back to investors and influencers, and project builders, I guess we can lump them in there.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
One question I like to ask myself before investing, these days, is: what am I actually buying into? Where does this lead? Is it actually part of a possible future?
18/You might answer that scams and ponzis and pyramids are as much part of our future as any web3 thingamajigs. And you're right. But do I want to be giving more energy, more money, more space to those things in my and other people's lives?
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
For me the answer is no.
19/Now, I'm human (in NFT terms: degen). And sometimes I'll still ape into something stupid because greed or fomo gets the better of me or whatever. But that's not the best I can be. And it's not what I want to consciously invest in.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
20/I don't want to judge people too harshly, particularly when they do things unconsciously. But much like, as I mentioned before, you can guess a project's vision by their roadmap, you can guess an influencer's motive by the kinds of projects they push.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
21/You can guess an investor's motivation for being in the space by the sort of projects they invest in and talk about.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
You can guess a founder's intention by the sort of project they build.
22/The majority of the NFT space, right now, is like a giant version of that wolf and sheep game. It's a redistribution machine, that takes from the unlucky and gives to the lucky. Some element of skill is involved, sure, but essentially it just shuffles money around randomly.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
23/That's not web3. It's just good old human greed applied to a new set of economic primitives. It happened with scam ICOs. It happens with NFTs. It will happen with the next thing.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
Anything that can be exploited for a ponzi scheme will be.
24/But amongst all that dross there are people using this new technology in exciting ways, to build genuinely valuable things. They don't get it right, but I think you can tell when that's what they're interested in.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
You can tell by the projects they talk about, for one.
25/So, to loop back to the beginning and close the topic, that's the key metric I'd like to leave you with to evaluate influencers - and that applies as much to the "big ones" (Becker, JRNY, elliot, whatever) as to any fellow investor you meet on a Discord.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
26/What projects do they talk about? What projects do they think are good? If the projects they rate are fundamentally just hype powered cash shuffling machines... well, you make up your mind what you do with that.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
But personally I'd stay away from their investment tips.
27/Ideally, unfollow them. Stop giving them the gift of your attention. Shift it instead towards where there is real value being created. Projects solving real problems, building things of value to their owners.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
28/You might miss out on the next hot tip.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
You'll also miss out on the next FOMO disaster that costs you $30k.
Others want to play the redistribution game? Let them.
It's going to be peanuts compared to what we're really building here.
29/And in this future that we're building with web3, it is plausible to say that WAGMI. Because we're not just shuffling bits of the existing pie around, we're also growing the pie for everyone.
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021
TL;DR: Your attention is valuable. Give it to those who deserve it.
gm & gl
PS: If you think I'm being all negative about NFT projects and all that, please read my super-bullish thread about NFT clubs and why I like to invest in a well-conceived NFT club. https://t.co/kzuL1oQpmE
— Daniel Tenner (swombat.eth) (@swombat) November 21, 2021