We started the week with our customary Sports Slice report, which included all of the latest sports and cryptocurrency news. We mentioned Ocavu and their new deal with BYU Athletics in last weekend's report. We spoke with Jon Cheney, the CEO and founder of the Utah-based organisation, about BYU Athletics, sports and NFTs, and other topics.
Breaking The Big Stones: Cheney Discusses The Current Situation
Bitcoinist: Thank you for taking the time to speak with me, Jon. Can you give us a high-level overview of Ocavu and your general thoughts on Web3 and NFTs for people who are unfamiliar?
JC: With Ocavu, we've taken next-gen technologies and tried to make them easier for companies, influencers, artists, and anyone else who wants to delve into these technologies, and we started in the XR space: all-immersive technologies, AR/VR, metaverse, and all of that wonderful stuff. We began shifting toward Web3 about a year and a half ago. This morning, I read on LinkedIn that one week on Web3 equaled one year in real life. When it comes to Web3, the space moves so quickly, and we've established an environment that allows anyone to launch their own community, to bring real-world utility to Web3 – whether that's your own crypto token or NFTs, or simply using generic Web3 concepts to create a decentralised community.
So there's a big response, but the short version is that if people want to start NFTs with their community, our team at Ocavu can help.
Bitcoinist: It's fantastic. If possible, let's look deeper into NFTs in particular. What do you believe is the most difficult difficulty in the talks you've had this year about NFTs, or even with influencers; what is a common thread that you're seeing surrounding challenges with NFTs for newcomers?
JC: One thing I frequently hear is, “didn't NFTs already have their run, didn't they crash, aren't they done?” And the truth is, they're done in the way they've been used for the last couple of years. A lot of individuals attempting to get rich quick by selling jpegs for a million dollars – I think that's done. Now is the time for NFTs to really dig in and ask themselves, ‘OK, what can this technology be used for, why is it better than Web2 technology, and what other methods to achieve comparable things?' It's really simply a matter of teaching people about the true purpose of NFTs, which I believe is a more efficient, transparent, and decentralised way to represent ownership of anything. What we've discovered that people love at our location is the ability to generate experiences, tickets, and ownership of various items, as well as having a nice, transparent, straightforward, and trustless manner to trade them amongst individuals. When you look at it in that light, where we say, “hey, let's focus on what Web3 brings to the table here,” it's a good way to express ownership and a trustless means to transfer and move assets between individuals.
Today, if you buy a football ticket, you can transfer it to someone else. However, in most cases, a third party is required to keep the ticket, and they charge you 40% of the ticket price in these exorbitant fees; with Web3, I can buy the ticket from you, you can say “hey, here's my ticket,” and I pay you, and it's all done on a blockchain. That enables for a trustless relationship – they don't have to know or trust each other to make that transfer happen – and offers up all kinds of potential for communities and businesses want to get involved.
The Sporting Impact: Ocavu, BYU, And Web3
Bitcoinist: Tickets are a great example. Sports and entertainment are my bread and butter, so I'd want to learn more about your BYU Athletics partnership, which apparently came to fruition in the last month or so; I'm sure things are fluid and growing, but are there any specifics you can share with us about that sports partnership?
JC: The NFT and web3 project I'm working on with BYU is called Cougs Rise, and you can learn more about it at CougsRise.com. We debuted a new feature called Collections over the weekend, which is very exciting. NBA Top Shot motivated me to assist BYU on this road. One of the first times I saw anything that made sense in the NFT realm was NBA Top Shot. That's digital trade cards that are stored on the blockchain, and I completely understand it. Scarcity exists because only a limited number of each item is produced – I understand. So we set out to develop something similar for BYU, and we said the whole time that we wanted it to be more than just trading cards. We don't want folks merely chiming in for the sake of conjecture; we want them to have a better fan experience as a result of this platform.
Working with BYU and our internal team, we can do a lot of really exciting stuff. For example, if you walk in today and buy particular NFTs, you can complete collections – and when you finish collections, if you're one of the first people to complete it, you get to redeem that for an experience. You will be given an NFT that will serve as a ticket to some sort of event. For example, BYU is hosting Baylor this weekend. That will be a big, enjoyable football game between two top-25 teams, which is very exciting. If you complete that collection, you will gain the experience necessary to enter the tunnel where the BYU players will emerge – right in the middle of the action. You can be on the field during warm-ups, meet players, go golfing with the squad, and do a variety of other activities by collecting these collections.
We're working hard to give these collections greater real-world meaning, but the cool thing is that once you finish them, you'll get this ticket that grants you tunnel entrance. Maybe you don't want to go there, but because you were one of the first to finish this, you can take that NFT and sell it to someone else who wants to come in and buy it. I believe that many of the individuals who are finishing the collections now want to use the experience, but the beautiful thing about NFTs is that you can then trade and let the market do what it does, have fun, and add more value on top of things. If you want to go to a Baylor game, going down to the field and hanging out with the players should be a valuable experience.
Bitcoinist: That always helps; I'd like to delve deeper into the broader aspect of that; you touched on a lot of it, but there's a lot of opportunity with live events in sports and in general. This is a cool connection, especially in sports, and it'll be interesting to see how it develops. Is sports in general something you view as a lever for Ocavu to use? Is this relationship the one you're really focused on in sports for the near term, or do you foresee more of these deals in the future? What is your general take on sports with Ocavu?
JC: Sports will be very important to us. We've negotiated several significant deals behind the scenes that we can't discuss just yet. Obviously, BYU is not small; it is enormous, even intimidating. It's quite exciting. It's a lot more work than you think; it's insane how much effort we put into this; it's like running a small business within our organisation. Running these mini-companies is difficult, but we're excited because it provides a model that can subsequently be pushed out to any team or organisation out there.
BYU is unique in that, when comparing a collegiate sports deal to a professional one, which we have numerous conversations with organisations in the professional market, the NIL component is absent. That, I believe, is what makes this BYU platform so unique. You can not only come in and buy experiences, but every time you buy an NFT or a digital collectible on CougsRise.com, a percentage of the proceeds goes to the player linked with that NFT, which is extremely fantastic. It's one of the first times fans can actually support their favourite players; if you just really like Jeren Hall as a quarterback, you can go buy one of his NFTs and know that a portion of that money is going to him, and you get a cool collectible and you might be able to have a cool experience, like going down to the field and meeting him and shaking his hand, or whatever it is. It's been incredibly amazing to be able to include the NIL feature into our platform.
Yes, sports are crucial; if you look at my board right now, you'll notice that I have this quadrant – or sextant – with sports, universities, artists, influencers, brands, and even just tech businesses. We have all of those different types of businesses collaborating with us to deliver an NFT marketplace and all of these other things to their followers. I personally see a bright future for all forms of media, such as television shows. If you were to create a Game of Thrones or The Office web3 community, where the TV show says, “hey, we're going to launch this thing, and you can buy experiences to hang out with Dwight, or to be able to jump on a Facetime call with the cast, or you're going to be able to get limited edition merch,” or whatever.
To be able to do those things, you have superfans who will take advantage of it and will gladly step up and pay money. It's another opportunity for these organisations to monetize while also providing enjoyable experiences and opportunities for fans to interact. What is the alternative now for fans? Look at what people are posting on Instagram and Twitter. That's all! The TV show Pysch is one of my favourites. I can send a message to James Roday, who plays Shawn Spencer. I can go on Twitter and say, “Hey, Shawn, what's up?” Is he going to answer me? No way, because there are a million other people trying to do the same thing, and it's not that he doesn't care – I'm sure he does – but he can't answer to a million tweets.
I believe that these web3 communities can create a mechanism through which you can say, “Hey, you know what, I do have the time to pay attention if someone is paying me $5,000.” We've built a platform that will allow any community to participate, but I know and expect that sports will be a huge part of it, based on the enthusiasm we've received and the initiatives we're working on.
Ocavu's Nuts and Bolts and the Power of Sports' “Superfans”
Bitcoinist: I appreciate your response, and your view on your verticals is interesting; thank you for sharing. There's a broad incentive alignment between fans and IP or whatever it is that provides a new level of connectedness. There are several clear-cut ways in sport or across skill, but one that appears more tough or difficult to crack is branding. You work with a lot of different brands, from different verticals at least, such as tech, social media, and apparel, so I'm curious if there are any common threads that you're seeing across those different verticals, or are the challenges that you're seeing with tech brands versus apparel brands, for example, very different?
JC: I guess the common thread is “wait, this is an NFT, but it doesn't feel like an NFT, this actually feels good!” People are terrified of that phrase, or acronym, because many people have been burned, and many news articles have said “NFTs are a joke, and they're a fraud,” but then a reputable company, team, or community comes out and says “hey, I'm doing NFTs,” and people go “wait what?” So, I believe that thread runs through everything, but there's no doubt that various techniques are required when you're a software firm versus a clothing company versus a TV show or piece of IP. You'll be doing a variety of activities.
For example, if you are a clothing firm and you just stated, “Hey, I want to do NFTs.” One of my first ideas is to create an exclusive club within your company where you have maybe 1,000 memberships and there will never be more than 1,000 – or maybe it's 100 – it's something small, but then you do limited drops of your clothing so that'superfans' of your clothing will buy those and have the ability to go into a'members only' merch shop where you can buy that limited edition whatever – create exclusivity. You can achieve the same thing with technology, but on a far larger scale. You could create more exclusive user groups of folks who wish to chat to each other and learn more. You must generate material that people will want to view, but it does not have to appeal to everyone; rather, it will appeal to your top 1%.
One of the things we've done with the Ocavu network, and I don't believe we're the only ones who do this, is that we can gate access to anything based on the contents of your Ocavu wallet. If you own one of these 100 NFTs, you can access additional content or even a website that may appear different to you because you own that NFT. Here's a crazy idea: let's say Facebook releases a million NFTs, and if you buy one of those – maybe they sell it for $10 – you have a bespoke skin to Facebook, and your Facebook experience is a little different, it looks cool, it has cool buttons and animations. But you can't get there by simply going into your settings and altering it; you'll need to acquire an NFT. So, a tech business can offer something as simple as that, where it simply makes things appear cool – it's distinctive.
How much money is spent nowadays on video game skins? Simply changing your Xbox's wallpaper or your character or avatar? There are so many examples of exclusive material, ways to express oneself in Fortnite, that can be unlocked and locked using web3 technology as we have.
Bitcoinist: That's a great example; we'll be lucky if they don't steal it. You took me exactly to where I wanted to go next, which was the Ocavu network, and you also had a utility token. Can you explain what that is, what it looks like, whether you've collaborated with a blockchain of choice, if you're utilising your own, and how these things tie into the bigger picture?
JC: Excellent question. For those reading at home, I'll clarify a few terms quickly: the Ocavu network is what I call the ‘utility layer.' It may be placed on top of any blockchain. It's designed to provide value by referencing an NFT or recording on the blockchain and saying, “Hey, whomever owns this NFT can unlock this utility,” and our engine can sit on top of whatever we want. We started with Polygon, and Polygon is the only network we're relying on right now because it's highly solid, it's built – I know there's disagreement about whether it's a true layer 2 – on top of a very stable ground, it has tremendous backup, it's environmentally friendly, and gas fees are incredibly low. So it had everything we needed to construct something at scale. We thought, what if there are 60 thousand transactions per day, how will this manage 500,000 transactions, 1 million transactions per day – and felt it might grow quite well. We do intend to construct a future in other chains like as Immutable X, Solana, Avalanche, and others that are cool for other reasons. We will prioritise based on the needs of our clients. So yet, no client has been able to provide an explanation for why Polygon would not operate correctly.
So the Ocavu network is basically this layer on top, it's own wallet, and if you go in to a site that has the Ocavu network on it, you put in your phone number, enter an auth code, and log in. It's quite simple; there's no password, no seed phrase, and it's a custodial wallet, so you don't have to worry about that. We will allow people who want to take control of their wallet from us in the near future. It will be a dual-system setup. The system we've created is intended for everyone. Not just for web3 fans like you and me. We can jump on Metamask, transfer files, and do all of these things and be fine. We've worked out how to do private keys and aren't concerned. Most people, however, are not. They'll be afraid of that; it's a traumatic experience. This was done with BYU in mind. If you take an overview cross-section of the 65,000 folks in this BYU stadium, what percentage, what slice of that stadium is comfortable managing their own private key and dealing with the word ‘NFT'? The answer is that it is quite little. So we decided to make a digital collectibles thing.
Some of the things the Ocavu network accomplishes, and the Ocavu network token contributes to, are providing an on-ramp and off-ramp for fiat; for example, if you go to CougsRise.com and buy something, you put in your credit card or debit card and you're done. We do not currently accept cryptocurrency, but we will. For the time being, we wanted to make things as simple as possible. So, the Ocavu network gives that on-ramp and off-ramp, a place for you to store your digital assets, and means for businesses to gate content. The Ocavu network token also serves as a liquidity pair for any communities interested in launching their own token. So we have various firms, one of which we have already disclosed is Mixtape token, and we have also revealed that BYU intends to create their own utility token in the future. We just didn't do it at the same time as their platform launch because it was too much all at once. As a result, we moved it back a little.
Finally, for those who are reading and are unaware, a new coin must be paired with something of value in order to create a liquidity pool. As a result, it can be traded on the open market. You have to pair it with something of real value, so we said, “OK, we can just come up and supply USDC as a pairing for all of these community tokens,” but that may be very expensive at scale. What if we utilised our own token as the liquidity pair, thus we'll take a million of our tokens and pair them with however many millions of tokens of this new coin there are. We'll couple them and put them on the market, and that new token may now be exchanged right away, which is extremely exciting. We don't have an infinite supply of Ocavu tokens, thus we don't want to continually emptying them, as this will devalue them. As a result, we built in a 2% repurchase of every single transaction within the Ocavu network. So, for example, when someone buys something on CougsRise.com, 2% of it will be used to acquire Ocavu network tokens, and the rest will go back into our treasury, replenishing our treasury and allowing us to continue pairing new tokens in new communities like that. As a result, it starts a loop that allows us to expand the entire network.
Bitcoinist: That sounds like it will keep you occupied, I'm sure. As we wind down here, Jon, I'll throw one more at you: this year has been difficult. The old adage is that those who can create and maintain difficult years like this can come out ahead when things start to improve and be an absolute tank. I'm curious about some of the challenges that are on your mind as we approach the fourth quarter of the year, and despite the broader headwinds throughout the year, maybe some things you're really proud of from your team this year – what's your overall status on how you're feeling about closing out the year?
JC: In general, there is a lot of unpredictability in the crypto market. There are a lot of headwinds, a lot of things going on, obviously interest rates, the FED, and all of that. The issue is that crypto is still, in my opinion, too closely linked to the broader market. I believe that, at some point, what is being referred to as the “decoupling,” in which the crypto market takes on a life of its own, will occur within the next 12 months. There's a major reason behind this. Some major groups, such as hedge funds, are beginning to establish channels through which they will be able to invest their money. When crypto becomes huge enough, it can pull away, and it is at that scale right now – a trillion dollars – but not by much in the grand scheme of things. When it reaches ten, twenty, or thirty trillion dollars on its own, it can truly begin to have a life of its own. I believe we will see significant growth in the next twelve months. Personally, I'm optimistic about the whole market.
To your point about how you deal with adversity… I enjoy the difficult times. Not because I enjoy the difficult aspects of difficult times, but because they compel us as builders to generate true value. You can see straight through all of these ponzi schemes, ponzinomics, frauds, and get-rich-quick schemes right now. People were saying a year ago, “this is wild, this is wonderful, everyone's making money.” People couldn't figure out why, and I'm telling them, “guys, there's no value here, it's not going to happen.” I was on the verge of rage. As many people were wondering about some of the NFT projects that were coming out, “why on earth are you buying it?”
It is during the downtimes that the good companies emerge. Because, as you correctly point out, if they can go through this period, it suggests they're offering something important that will only grow in value as the market recovers. Overall, I'm extremely happy; my team [at Ocavu] has been incredible; we're pulling things off with some of the schedules that we've done that are simply insane. I'll reveal something I don't think I've ever discussed with anyone: it took only 28 days from the moment we decided to establish the Ocavu network token to the time it went live. That was insane, so we created Ocavu.live, a staking platform for early adopters to provide liquidity. We had to design the token itself, as well as litepapers, other types of text, and the creation of a discord server, among other things. Our team at Ocavu was able to put together an unbelievable effort and launch that; we have a strong team here at Ocavu, I'm extremely pleased of them and forward to see what they can do in the next years.
Bitcoinist: I'm sure there wasn't much sleep during those 28 days. Thank you for sharing that with us, as well as some of your insights today. Thank you so much for your time, Jon. It is greatly appreciated.