Bored Ape Yacht Club, Comic Con & Mistaking Identity Expression for Community Formation
NFTs are necessary but not sufficient for community, and the more likely destinies of PFP collections are media companies or fashion brands.
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For those of you not following the Crypto world close enough, profile pic NFT collections are all the rage — Apes, Punks, Kitties and more, these are collections of often around 10,000 images, iterations on various characters that people buy, trade and show off on their profiles. Bored Ape Yacht Club is one of the biggest, and they did more resales recently than the entire movie industry.
Originally, buying one of these NFTs came with a community — if you put a Bored Ape as your profile pic you got a bunch of follows, felt a sense of kinship with all the other crypto enthusiasts, were invited to Discords and parties and made new online friends. All things that you can be forgiven for mistaking as a real community.
But as the hype has grown, this community has started to fade — as Apes and Punks exchanged hands and the new owners didn’t have as much in common with the old owners even the biggest enthusiasts have told me the camaraderie isn’t what it once was. Most will recognize you are not in a “community” with Stephen Curry because you own the same JPEG collection now. And the troublingly high price of community entrance has led many to ask what they have in common with many of the new owners anyway . . .
But these PFP (Profile Pic) NFT collection owners were simply misreading what type of community they were building, and didn’t realize their place in it — NFT collections resemble brand identities more than real communities, and the most likely future of these brands are as media or fashion brands, with early NFT adopters as the Comic Con enthusiasts to the Web3 Star Wars of the future.
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PFP NFT Collections Are Brand Identities Not Communities
In the real world, no one deludes themselves into thinking that once you become part of the BMW drivers club you now have a real community of friends. You bought the BMW because the brand speaks to how you view yourself as a person, and broadcasts it to the world through its logo. Another car enthusiast might strike up a conversation with you because you have a similar car, just like there are chat rooms and people slide into your DMs on Twitter if you have an Ape as a profile pic, but those are cursory benefits — you bought the car because it’s a BMW, not because of friendship.
And you buy a Bored Ape Yacht Club because you want to show the world you were an early Crypto enthusiast. Or have a lot of money.
BAYC is the BMW of the Metaverse. Or the Porsche.
This is the first generation of NFT “communities” – brand communities that enable identity expression.
If we want to be pessimistic, these aren’t REALLY communities but audiences. And if you want to be REALLY REALLY pessimistic these aren’t really communities but fashion brands — a sort of digital Louis Vuitton bag or Maserati, a way to signal one’s status in the online community, but instead of a bag or car, owners are showing off their NFTs in the one piece of digital real estate people pay attention to, the profile pic.
But I digress. Brand communities primarily curate in two ways . . .
Proof of Knowledge and Proof of Funds
Only people in the know will know that the black dog on that hat you got came from a shop in Martha’s Vineyard, subtly signaling to people that you are of the social class to vacation in such a posh location.
Supreme, exclusive shoe brands and more curate their communities by making purchase knowledge hard to obtain, often on special email lists, drops and pop-up locations.
And layered on top of knowledge is pricing strategy, or Proof of Funds, which is used to curate who a product is for — a Birkin bag costs $30k+ and helps curate a clientele of extreme wealth. A Rimowa suitcase is priced to curate only to extremely wealthy travelers.
(Sidenote: it’s super interesting to think about how Supreme’s strategy combines these techniques— a thriving resale market where the insiders with high Proof of Knowledge but lower Proof of Funds can sell at markup to those with lower Proof of Knowledge but higher Proof of Funds . . . but that’s a completely separate article)
Crypto has followed this pattern – to buy a BAYC NFT at the beginning you needed to 1) Know what an NFT was 2) Know enough about crypto to believe that it would be worth something and wasn’t a fraud 3) Know how to set up a Metamask account 4) Be wealthy enough to have bought Ethereum at some point and 5) have enough money to spend thousands of dollars on a JPEG and be ok losing it.
At the beginning this was a decently high curation threshold, which led to everyone who bought these JPEGs to actually have a lot in common.
But Proof of Funds and Proof of Knowledge by themselves are incomplete and a recipe for eventual community breakup.
“Undesirable communities,” as a brand, not me, defines them, could decide to take a brand into their own hands and create their own identity. The most famous example is when working class Brits in Essex reclaimed the Burberry pattern as their own:
But this isn’t one directional, luxury brands being “sullied” by the hoi polloi, it happens in the other direction too . . .
Carhartt & Influencer Moms
Carhartt is the best illustration of the precarious nature of all brand identities and why they can never really evolved into real genuine communities.
“Carhartt was founded in 1889 as a workwear brand, and still is one today, outfitting primarily ranch hands, farmworkers, and other outdoor laborers in its signature heavy coveralls and bibs. However, over the past several decades, the brand has become “cool,” first becoming beloved by hip-hop artists and skateboarders in the 1980s and 1990s. In 1989, the spinoff brand Carhartt Work in Progress was launched to appeal to this more artsy, less handy clientele.”
During the pandemic, it apparently became a thing for influencer families and “cool moms” to wear.
By all accounts Carhartt the company is thrilled but I’m willing to bet there are a bunch of construction guys rolling their eyes — this brand that they identified with for decades and meant something to them is being co-opted by a bunch of suburban moms who (my theory) retreated to their country homes during the pandemic and decided to be just a little bit more “country” in their aesthetic . . .
And what happens when Carhartt decides to quadruple the price of the very affordable $16 beanie because they’ve now become fashionable?
A bunch of very disgruntled construction workers revolt, that’s what happens . . .
Proof of Knowledge and Proof of Funds are extremely weak curation mechanisms, and they open up communities built around them to hostile takeovers.
Another term for this might be “cultural appropriation.” It has been happening all throughout history, from African Americans and Jazz to Latinos and the Mission neighborhood of SF . . . ironically this probably happens MORE often in this direction as it’s a bit harder to stage a hostile takeover of Burberry than it is to decide that something affordable is now cool . . .
In a nutshell this is what is happening to Bored Ape Yacht Club — they are being Carhartted, culturally appropriated — a niche brand that meant something to a particular community is being taken over by the wealthy and privileged.
As crypto knowledge becomes more widespread, the Proof of Knowledge curation mechanism has become a lot less effective – more of mainstream society has caught on and Discords are crowded with get-rich-quick types hawking you a brand new collection of Giraffes, Rhinos or Possums who gamble or have zombie eyes or a drinking problem or something.
The Proof of Funds has become a negative selection bias — instead of selecting on people who believe crypto will be worth something one day, i.e. selecting on belief and a desire to invest in the future, it is now selecting on people who want to make money off of crypto — what started as a de-facto “Proof of Belief In Crypto” has become “Proof of Extreme Wealth.”
In the same way wealthy instagram moms have taken over Carhartt, wealthy investors have taken over BAYC.
How Did We Get Here?
I saw a quote recently that said Web2 was about building communities around companies and Web3 is about building companies around communities.
While obviously not universally true I get the spirit of the comment and agree it’s directionally accurate, but there needs to be a distinction — just because a Web3 company starts as a community that doesn’t make every Web3 company a community company.
Plenty of companies have thriving communities but aren’t community companies.
Like Star Wars.
Clearly a media company, there is a thriving community of Star Wars enthusiasts who literally dress up in Stormtrooper costumes and make a pilgrimage every year to Comic Con as part of a group called the 501st Legion.
Bored Ape Yacht Club is Star Wars or Marvel if it grew out of Comic Con instead of Comic Con growing out of Star Wars and Marvel fandom.
With Web3 it’s just happening in reverse.
And if I was a guy dressing up in a Stormtrooper outfit at Comic Con, it wouldn’t be ridiculous to mistake Star Wars as a “community” company and not a media company because from what I saw at ComicCon, the movies were such a small part of what Star Wars meant to everyone in that room. To me, it was really about friendship and belonging.
But while community may be where Bored Ape Yacht Club started, it’s not its destiny.
To BAYC’s credit, their biggest moves seem to indicate that they actually do have a more subtle understanding of who they are at their core as they mull getting into TV, movies and music.
And that is where I think most of these PFP communities will end up — their structures are built for distributed and participatory storytelling, and storytelling’s best scalable forms will be in games and media.
Real Communities Need Real Curation
So does that mean that NFTs are not good for community?
I don’t believe that. At Maxwell we’re obviously building a company that has NFTs at their core.
But we have a more subtle view — NFTs are necessary but not sufficient to build community in this new world.
For a real community to form you need more mechanisms than just Proof of Knowledge and Proof of Funds.
You need to do more than know that Harvard is a good school and be able to afford it to gain entry to Harvard, including Proof of SATs, Proof of GPA, Proof of Essay that all factor into a Proof of Admissions process.
Getting into any of the more exclusive British social clubs like 5 Hertford St, Annabel’s, Whites, Boodles or Brooks requires some combination of Proof of Accomplishment, Proof of Aristocracy, Proof of Social Connections/Class, Proof of Friendship, etc.
The simple fact is the desirability of being part of a community is directly correlated with how curated it is.
If Web3 is going to make the jump to REAL communities instead of simply brand communities, it needs a more robust curation framework that more closely mirrors real communities.
NFTs are part of the equation. But they aren’t the entire solution.
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David (@dlitwak), Kyle, Joelle
Great points here! I shared this with my friend and colleague Todd Nilson and this was his response: https://vm.tiktok.com/TTPdksDc2B/