Yat Siu explains the importance of protecting the property rights of the creators and developers. Failure to protect it might cause serious problems.
Read our notes below to learn more.
Royalties
NFT Royalty volume is up.
Royalties are effectively close to zero.
The network effect is that something like 18,000 worth of ETH plus has been lost to creators.
The whole point of Web 3 is that it aligns the network effects between the people who are using it. The creators, owners, and perhaps the platform.
Web 3
The whole point of Web 3 is that they get to share the benefit of the shared network that exists.
In the Web 2 world, that benefit is accrued to the platforms.
Nothing is free. When you use Facebook they will farm your data and generate value from it.
When they use Ethereum they will pay for gas as a mechanism to support the infrastructure.
Royalties to creators are essentially another kind of gas. It is the gas of the NFT world.
Yuga has made hundreds of millions of dollars in Royalties.
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Tragedy of Commons in Free Rider Effect
Those people who trade and don’t pay a royalty fee will affect the system because they are not paying for it and something happens like a market failure.
When market failure happens it is because there’s not enough value and money that goes back into the ecosystem to maintain it.
Back in the 80s and early 90s, music was a fairly thriving business.
Music piracy emerged with services like Napster and Pirate Bay.
It becomes normal not to pay for music and that created a problem when it comes to musicians.
A centralized version of protecting music right with the raise of Spotify and Apple music came next. They saw an increase in the revenue of the musicians.
Public Blockchains, Metaverse, and NFTs as the New National Economies
Free writing, public goods, and common goods are really important.
National Economies are actually driven very much by arts and culture.
In the U.S., art and culture rights are being protected, and that allows the economy to grow.
China is the number 1 piracy place in the world.
The serious effect of this in China is that there was absolutely no intellectual development that happened up until China started protecting it.
Today, China is the largest producer of patents even ahead of the U.S.
The point is, they need to protect the rights of the creators and developers otherwise they will destroy the ecosystem they are trying to build and defend.
Anomica Brands Approach
As creative commons, they issued multiple sets of licenses that provide a kind of legal protection framework for creators.
The license agreement is inspired basically on sort of the way the Digital Millenium Copyrights Act works.
Youtube Vs. Viacom
Youtube agreed to pay royalties on all the content that was used for other creators, not just Viacom.
YouTube probably didn’t want an actual court law.
Sustainable Profit
People are willing to pay a premium for sustainability.
People buy and invest in things not just because of value but because they want it to be sustainable in the long term.
Imaginative Thinking Test
Children at the age of 5 are basically genius-level creative people. 98% solve their problem.
At the age of 10, it drops to 30%.
When they are teenagers it drops to 12%.
And when they become adults, mostly around 2%.
People are born creative.
Conclusion
Animoca and creators are not just fighting for the rights of musicians or artists, they are fighting for the rights of everybody.
Creators are the backbone of their culture.
Culture is the backbone of every economy.
The protection of private property rights is what makes Capitalism work.
Royalties and fees are the property right of the creator.
The countries that have strong property rights have the highest GDPs in the world.
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