On Proofing Value for Community & 777 as the Holy Number
PROOF, Live Casinos, and the war between ETH L2s & Alt L1s
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TLDR
The PROOF Collective, an overview of the highly successful exclusive NFT club
Live casinos bring new life to online crypto gambling
Ethereum layer 2s begin to roll out, how do they compare to alternate layer 1s?
The PROOF Collective: Bringing Value Back To Its Members
An increasingly popular trend rising in web3 is ‘Gated Communities’, in which access to the community is controlled or limited, generally by ownership of the project’s NFT or holding a certain amount of that project’s token. The most known example of a Gated Community is Friends With Benefits DAO (FWB), which is as much of a social club as it is a value add to its community members.
A well designed gated community can create a culture of in-depth and thought provoking conversations, alpha on upcoming projects and drops, and new connections formed from online chat and IRL events. The idea is that the barrier to entry incentivizes users to participate in the project’s activities more, and in turn that increased participation rewards the members through increased knowledge, early access to projects, airdrops (such as $APE coin drop to all BAYC holders), etc. Several of these communities have popped up in the past year, however, one making waves as a masterclass in gated communities is The PROOF Collective.
The PROOF Collective is a NFT community where membership is determined by ownership of one the 1,000 membership NFTs. Launching a little over four months ago the floor price for one of these NFTs has skyrocketed to a floor of 85 ETH, an indication of the high demand to join this exclusive community. Perks of membership include access to the private Discord, early access to the PROOF podcast, in-person events, and access to collaborations created exclusively for PROOF NFT holders. Some of these exclusive collaborations include the Grails, Emotes by Heartyou, and Moonbirds.
The Grails Collaboration included 20 pieces of art, created by 20 unique artists, where each PROOF Collective NFT holder was able to mint one NFT. What made this mint unique? Artist’s names were hidden during the minting process and it was not known who would mint which NFT, creating almost a game theory of who would mint which NFT. This information was only revealed after minting in a livestream hosted by PROOF. The floor of a Grail NFT is currently at 2 ETH with some being worth 70 or more ETH.
The Emotes by Heartyou Collaboration was another PROOF exclusive mint. The project markets itself as “a project of self understanding, love and acceptance of the whole self, including our shadow self” and boasts that it is “the first Proof + Artist PFP collaboration project featuring 1433 generated NFTs”.
The upcoming Moonbirds mint, was also a PROOF collaboration and also unlocks private membership to the PROOF Discord and additional benefits that release the longer you hold the NFT (they dubbed this waiting period nesting). Holding a Moonbird will also grant access to the PROOF-built metaverse project in which PROOF describes as “uniquely different” from any other Metaverse project.
Communities such as FWB, Crypto Packaged Goods, and The PROOF Collective create an exclusive environment where deals are made and personal and professional relationships are formed, almost like the web3 version of a country club membership. Successful communities who deliver great value to their members command a high price of entry.
Online Crypto Gambling Sees a New Twist
One of the first real use cases of cryptocurrency was undoubtedly online gambling. And it makes sense, listen to a few podcasts with early crypto adopters and when asked how they got into cryptocurrency you are bound to hear the response of “I was into online poker when my buddy introduced me to bitcoin back in 2011” or something along those lines. Naturally, with so many online gamblers, they found a way to combine their passion for online gambling with the emerging technology of blockchain. Fast forward a decade and there are dozens of online sites that offer online gambling denoted in cryptocurrency.
Using cryptocurrency as an online payment method for online gambling is not a new concept and it makes sense. Crypto offers privacy for the users, while offering fast and secure transactions for the casino itself. What’s missing from online gambling is the experience. The bright flashing lights, the ringing of the slot machines, and the human interaction between the player and the dealer. Enter 777s.casino, a website that features a “live casino” which is a casino that offers the ability to play with a real dealer without visiting a physical gambling establishment. 777s Casino offers users to gamble in 15 cryptocurrencies (including ETH and LUNA).
When I first heard of a ‘live casino’ I pictured some dealer sitting in a basement with a subpar webcam, dealing cards on a folding plastic table. After joining a reputable live casino, I found out I was wrong. Instead I found a well-dressed dealer seated at an actual blackjack table with multiple high quality camera angles. A chat box allows you to interact with the dealer and other players, bringing back human interaction to online gambling. The experience mimicked an actual casino as much as possible given the online nature of the activities.
The human aspect of a live casino can also reassure many users. For example when you roll the dice in a game of craps on a traditional online casino, you do so via a random number generator. This random number generator can be coded to work heavily in the casino’s favor. In a ‘live casino’ the dealer rolls physical dice to determine your number. Assuming the dice is not manipulated with, you are guaranteed the same odds of winning as if you were to walk into a casino on the Las Vegas Strip.
Online casinos that offer cryptocurrency as a payment method are a real world use case for cryptocurrency. Combine the user experience of live casinos with the pandemic and you can see why this form of online gambling has been on the rise lately.
Before running off to gamble on 777s Casino, please note that the site is only available outside of the United States or by VPN. Users should do their own research on the legality of online gambling sites with respect to their resident country’s laws and regulations.
Ethereum Layer 2s Vs Alternate Layer 1s
The long awaited transition from proof-of-work to proof-of-stake on the Ethereum network is set to take place by the end of Q2 this year. With that in mind there has been essentially a PSA that this transition will not immediately result in cheaper gas fees on Ethereum layer one. Instead those looking to reduce their gas expenditures should look towards layer 2s. But what will this landscape of L2s look like, and what are the benefits and risks of operating in such a system?
Looking at the blockchain trilemma, Ethereum focuses heavily on decentralization and security. It's the reason why so many investors trust their money on the network. An $80 transaction cost is worth the peace of mind when dealing with hundreds of thousands of dollars worth of assets. However, not everyone is investing millions of dollars into crypto, and paying high gas fees can really dig into your profits. Perhaps that is the reason we have seen the rise of alternate layer ones that brand themselves as ‘Ethereum Killers’ such as Solana, Avalanche, and Cardano.
Ethereum will look to improve as an ecosystem through layer 2s such as rollups. Those looking for more information on how rollups will improve the transaction speed while maintaining securities should check out Aric Chang’s medium article, An Investor's Perspective on Rollups. In the article Aric outlines how rollups would lower transaction fees but notes the fact that current rollup gas fees from projects like Optimism and Arbitrum are still higher than alternative layer 1s.
The Ethereum merge will aim to keep the security and decentralization of the ethereum layer 1 network while improving tps and reducing gas fees through rollups. Some may be wondering, wouldn’t the bridging from layer 1 to layer 2s expose your funds to great risk? After all, two of the largest crypto hacks to date (Solana Wormhole hack and The Ronin Bridge hack) happened as a result of weaknesses in a cross chain bridge. Vitalik doesn’t see bridging as a weakness in the Ethereum ecosystem, as explained in a reddit thread.
Simply put, the perfect project does not exist. Solana boasts of the ability to process 50,000 transactions per second (tps) but has repeatedly suffered outages lasting in excess of 8 hours. Avalanche aims to solve the blockchain trilemma but only has approximately one validator per Ethereum’s 270. Cardano has promised a lot but has only recently launched its dapps.
So does a world exist where the world operates on Ethereum layer 2s and layer 3s while other branded ‘Ethereum Killers’ fade into nothingness? Likely not. There will always be a market for healthy competition, similar to androids and iphones. There will always be the people who swear by iphones and vice versa. There will also be people who gravitate towards the better product for their needs.
Overall, there is not likely to be one ecosystem that solves everyone’s problems and we should view that as a good thing. Ethereum is currently the leader and many see it staying that way in the future, however that’s not to say that other layer 1s can’t coexist.
For those interested more in this topic, Chainforest along with members Aric - @AChang_888 and Markxu will be hosting a twitter spaces on Rollups. The Twitter space will be on 4/20 at 8pm EST.