GM frens,

In today's edition of The Ground Floor we will be breaking down the biggest battleground in the Web3 World — building trust with consumers.

Building Trust in Web3

Breaking down the biggest battle ground in the Web3 World...

Trust is the most valuable currency in Web3.

Building applications on blockchains codifies this social currency into the applications we interact with thanks to blockchains enabling consumers to easily verify claims such as who created, who owned, & who possess ownership of digital assets on chain.

Expectations

Despite this breakthrough, the level of trust many consumers are currently placing in the applications being built on blockchains is arguably reaching all time lows.

Why is this the case?

The core problem we will be examining today is the mis-management of expectations. 

Such mis-management of expectations are easy to explain in the case of crypto exchanges such as FTX who misused customers deposits, and apps such as BlockFi who promised incredible interest rates on customers funds — only to declare bankruptcy last week. 

In the case of NFT projects, this mis-management of expectations is much more prominent, and albeit customers haven't had their deposits stolen, many many many NFT collectors have purchased assets that have lost upwards of 90% of their value.

Building Trust

The trust consumers place in a brand isn't based on any single action or interaction, rather it's the sum of all interactions we as individuals, and the people we trust have with a brand.

When a consumer purchases a pair of Nike running shoes, this purchase comes with a set of expectations that the shoes in question will fit their feet & many more expectations Nike's marketing materials will have helped shape.

Nike's ability to build trust in these interactions to create repeat purchasers is based on their ability to match or, better yet, exceed expectations.

When a consumer purchases an NFT, this purchase also comes with a set of expectations. 

The Hype Machine

To understand the expectations consumers have when purchasing NFTs, it's important to understand the expectations creators create to successfully launch an NFT project.

As we mentioned in last week's edition of The Ground Floor, the most important milestone an NFT project must overcome is minting out a collection.

To overcome this obstacle, creators are often required to invest in their "hype machine" whereby they explain all of the amazing benefits of holding their NFT, many of which won't come to fruition for weeks, perhaps even months post mint.

Unclear Timelines

The lure of future value creation isn't the problem that's currently plaguing the Web3 World and plunging consumers trust in Web3 applicants — rather it's Web3 projects inability to effectively communicate clear timelines for consumers realizing such benefits.

Consider this, how many NFT projects have promised play to earn games to their token holders vs how many projects have actually provided their holders with such games, or at the very least a clear timeline on when they can expect to have access to such a game?

Personally, I could count more than a dozen projects that have made such promises, and have provided almost zero updates on the progress being made.

Today, consumers simply have to trust progress is being made.

Opposing Philosophies

One of the foundational features of blockchains is verify, don't trust.

In a world whereby consumers cannot check on chain to confirm when a project will deliver on the promises / expectations they have created — how can we verify the validity of the communication projects are using to create hype?

As an active collector of NFTs, I've personally adopted the following two-pronged approach of allocating trust based on track records.

1) Have the leaders of the project built successful businesses in the past?

2) Has the project delivered on the promises they have made up until this point?

📡 Looking Forward 

The Web3 World consists of both buyers & sellers, or said differently creator & collectors.

While it's crystal clear that the innovations blockchains have brought to the table to improve digital goods are here to stay, it's also clear that the Web3 World has much room for improvement when it comes to creating realistic expectations for consumers as to the value they can expect to receive from owning an NFT.

While I don't expect these changes to occur over night, this is both the biggest problem, and the greatest opportunity in the Web3 World as any good, both physical & digital is only as good as its ability to match & exceed consumers expectations.

An all too uncommon occurrence in Web3 today.

3 Things You Need to Know

1️⃣ CloneX Companions

Nike's premier NFT collection, CloneX has been hinting for months that they would launch a CloneX companion collection.

This week, the team leading the project airdropped CloneX holders an "Animus Egg" that will hatch an unknown entity in the New Year. 

To understand what to expect when these eggs hatch, we put together a timeline of the Tweets describing this companion collection for Clones.

2️⃣ ZenAcademy's PFP Collection

Web3 educators are in short supply. 

To fill this void, Zeneca, a former professional poker player turned Web3 content creator created a discord for people who wanted to learn about NFTs. 

In the months since, this discord has morphed into ZenAcademy, a successful Web3 education company that recently announced it's plans to release a PFP collection.

To understand how you can participate in this upcoming profile picture collection, we outlined the requirements to guarantees your participation.

3️⃣ Uniswap's NFTs Strategy

One of the primary benefits of NFTs is the ability to re-sell these digital assets in an open market without requiring the permission from the protocol to do so.

That said, for the sellers seeking to sell an NFT in 2022 it can soon turn into a waiting game due to the unknown amount of time it takes to sell an NFT.

To help buyers & sellers, Uniswap, the billion dollar decentralized crypto exchange is launching an NFT aggregator to provide consumers with NFT listings across each of the major marketplaces & aiming to provide sellers the best liquidity.

To learn how Uniswap is seeking to expand its reach into NFTs, we broke down its strategy to beat its competition from companies such as Blur.

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See you next time! — OB1 👋