Sep 26, 2021 • 28M

Blockchain, NFTs & the Metaverse with Dominic Gluchowski

Dominic Gluchowski is the CMO of one of Australia's most trusted and long running crypto-exchanges, CoinJar. In this conversation we talk about the current NFT interest and the emerging metaverse.

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Nick Byrne
We interview people working at the edge of technology, society and the next economy.
Episode details

I had the pleasure of speaking with good friend and CMO of CoinJar, Dominic Gluchowski. We had great conversation covering NFTs and the emerging metaverse. We hope to make this a regular conversation, allowing us to go deeper into the specifics of blockchain next time.

If you’d rather read the conversation then listen to it, the full transcript is below.

The highlight of the conversation for me was the realisation that the metaverse isn’t just a buzz word. In fact, it fits Clayton Christensen’s Innovators Dilemma theory perfectly. It has emerged from the fringes as something that looks playful and commercially unattractive to the incumbents. People tend to overestimate what we can achieve in the short run while underestimating what we can achieve in the long run. Going by this, metaverse progress in the short run will mostly disappoint and lead to people pointing out that it was just a hype cycle. But, a new model for the next evolution of the internet is being incubated by those working on the metaverse, the seeds are being sowed for the next shift in the digital experience.

About Dominic

Dom Gluchowski is the Chief Marketing Officer at CoinJar, Australia’s longest-running bitcoin and cryptocurrency exchange. With more than 20 years of experience leading high-performance marketing teams, Dom is responsible for developing and executing CoinJar’s brand identity and marketing strategy, from planning day-to-day communications through to the establishment of major partnerships with some of Australia and the UK’s biggest sporting teams.

Links from this conversation:

Interview transcript

Nick Byrne 0:00

So thanks, Dom. I'll let you introduce yourself in a second. But this is just a bit of a conversation that I'm hoping to include in the newsletter going forward.

I’m interested in introducing some people that I enjoy talking to and take a lot of inspiration and knowledge from, so thanks for agreeing to jump on a zoom call at the last minute.

For those people that don't know who you are, do you want to introduce yourself briefly?

Dominic Gluchowski 0:29

Sure. And yeah, always great to chat with you as well. And thank you for the kind words.

I'm Dom and I look after marketing for CoinJar, Australia's longest running cryptocurrency exchange. We have over half a million Australians using us to buy and sell Bitcoin and other cryptocurrencies. And I've been with CoinJar for about almost two years now. So it's been an amazing journey. A lot of fun.

Nick Byrne 0:59

When you say “look after marketing”, you're underselling yourself obviously. You’re the CMO? Right?

Dominic Gluchowski 1:06

I am, I am. We’re a small company, so you know, you tend to do everything just like everyone else. Which makes it more exciting as well.

Nick Byrne 1:18

Awesome. Well, there's been a lot happening this year in the crypto markets and I’m keen to talk to you about all of that. But I guess to jump off with, there's been some really interesting deals that CoinJar has been announcing recently, with some football leagues across the world coming on as partners. So I thought a topic we could start with would be to help us understand, first of all, what what are those deals? But also what is it about this year that's triggered conventional organizations to start to move into crypto and take an interest in the sector all of a sudden, after many years of everyone being dismissive of Bitcoin and crypto?

Dominic Gluchowski 1:59

Yeah, so when I started with CoinJar my marketing budget was fairly small, which means usually means that you spend most of your budget on performance marketing. So you know, you spent $10 on something and you're trying to get $20 out of it, right. Trying to turn turn it into a profit.

I guess, because of the bull market that we had back in March 2020 and then from September 2020, till today, a lot of people started to trade a lot more, and we do charge a fee based on the trading volume. So as as our revenue grew (with these bull markets) it allowed us to invest in our brand. Investing into the brand is not something you're going to get a return on straightaway. It's something that might take maybe three or four years. It's going to be very slow improvements, you know, in how you acquire your customers, how you retain your customers, small improvements in getting new corporate partnerships and getting it's just a little bit easier to do everything over time and it compounds.

So I think, why we seeing a lot of a lot of different cryptocurrency exchanges trying to invest into brand building is because the budget allows it, and they do recognize it's important for the future of the organisation.

Nick Byrne 3:41

So just reminding what, what are the recent deals the CoinJar has done? There has been some with European sports leagues and Australian sports league, yeah?

Dominic Gluchowski 3:50

Yeah. So we've partnered with Melbourne football club as it's a cryptocurrency sponsor, and also with Brentford Football club, an English Premier League team.

There’s a bit of a journey behind why we've chosen these two. We obviously operate both in Australia and the UK markets. In Australia, we didn't have a budget to sponsor all of the AFL, but Melbourne just has the best demographics for us. We don't have 1000s of different niche cryptocurrencies, we just have you know, over 30 main tokens with everyone wants to buy and we find that the Melbourne football club demographic was the right one for that because they are generally more interested in protecting wealth and investing rather than gambling everything on some random coin that's probably going to go to zero very quickly, but it could go to the moon first as well.

I guess with English Premier League. It's, it's you know, we are new to the UK and they just qualified for the English Premier League. It's a great club, it's a bit of a Moneyball story, if you if you watch the movie with Brad Pitt, so use technology and statistics to choose players and you know, the people love Premier League, and then they train them. And, you know, they go into different clubs, so they make money on transfers as well. So we just thought this story very much aligns with how CoinJar runs as well, it's all very science based.

Nick Byrne 5:30

Well, you've done well with the Melbourne Demons partnership. Let's see how they go tomorrow in the grand final. So for anyone who's listening to this, for those outside of Australia, the Melbourne demons are in the AFL grand-final which is playing tomorrow. So these partnerships are more about marketing CoinJar than a sign that those leagues are looking to invest in blockchain technology or do something with it themselves?

Dominic Gluchowski 5:59

Well, yeah, it is more of a branding exercise, basically partnering with really strong, recognizable brands. And at the same time, you know, we also have to be accepted by them. And they did a lot of due diligence to make sure that, you know, we’re not some dodgy exchange that is going to take the members money and run away, as well. So it was the proper due diligence, just like you do when you get a big corporate partner as well.

And, you know, I guess moving forward, we'll be looking at diversifying outside of sports as well. So looking at into partnerships with community organizations, charities, arts, and a lot of different verticals as well. Right. So that's part of what brand building is, I guess the reason we started with sports is, it's basically where our audience is. So maybe, maybe even as long as six months ago, 90% of our customers are male. And when when we looked at where our customers are online, they tend to be with AFL and EPL websites. So that's why we we've chosen that sport vertical.

Nick Byrne 7:23

Interesting. Well, if there's anything to take away from it, then at least those conventional businesses has somewhat deemed crypto is no longer the wild wild west or something to be scared of, and that they're happy to partner with the right brand. I mean, CoinJar is clearly one of the more stable and trusted brands in Australia. So yeah, there's still crypto out there that they wouldn't partner with. But the fact that they have is, is a good sign.

Dominic Gluchowski 7:50

So there are challenges, Nick, in that as well. There are, you know, all of the clubs players are thinking about getting into crypto themselves, including AFL, I think AFL had a tender out recently. And you know, they will probably start with merchandise, digital merchandise to start with. But eventually, they would move into, you know, ticketing, VIP tickets. And by having it all done over blockchain, you know, everyone can see what everyone else is doing. So it's really easy for you to identify and reach out to your biggest fans, your biggest followers and offer them special packages and reward them with it. And that's really just amplifies, you know, amplifies your followers voice as well and gives the opportunity to reward them. So, you know, they have certainly surrounded themselves with the right advisors to make it happen. But it is a bit of a journey. They still old school traditional businesses, but they are very much aware of what's happening and moving in a direction to make the most of it.

Nick Byrne 8:58

So that's probably a good segue into the NFTs, and commenting on the cycle that we have just gone through. Other than AFL, are there any other sports codes around the world that you're seeing making these sorts of moves? Investing in digital merchandise and ticketing, leveraging NFT's and other blockchain technologies?

Dominic Gluchowski 9:15

So obviously, European football, you've got baseball in America, basketball, FTX, which is one of our worldwide competitors. They tend to sponsor a quite a lot of different sports. Formula One, small categories in general. Poker is quite popular as well. Yeah, so it's, it's growing very quickly. And we definitely see that in, in arts as well.

Nick Byrne 9:52

So NF T is being applied across all those sports that you've just described? Can you give me an example of how it's being used in F1, or, or baseball?

Dominic Gluchowski 10:04

Yeah, I mean, right now with baseball, they just sponsored, the whole baseball league. So again, it's a similar partnership to how we sponsor Melbourne Football Club, for example. And, you know, with Formula One, it's a similar thing where we sponsor the safety car, but I guess some of the some of the English Premier League teams are issuing their own tokens, and it's still at the very early stages where they offer tokens, you can't really do much with it yet. But utility is coming.

Nick Byrne 10:40

That's really interesting. So sounds like the AFL, if they start to move in this direction (to use blockchain technology) could actually be ahead of the curve and do something quite interesting from a global perspective?

Dominic Gluchowski 10:51

Yes, certainly. So yeah, I'd love to see some digital merchandise. And I guess that the great thing about blockchain is that when when you issue some unique digital merchandise you can set it so there are only 20 copies, and there'll be only 20 copies of it in the future, you can't just add another million copies, like some of the baseball cards companies used to do, you won't be able to do that. So that merchandise can be very valuable as well. And quite special.

Nick Byrne 11:31

Absolutely. So one of the things you and I have talked about when the camera isn’t running is which NFT artwork and tokens and things like that we're most excited about. Can you give us a glimpse into what's been happening over the last few months from your perspective when it comes to NFTs?

I suppose there have been two sides, right? There has been NFT infrastructure, which has driven attractive token prices and there has been interesting stuff there. But then there's the NFT markets themselves and the art that's being traded. What have you found interesting, and the most exciting over the last three to six months on these fronts?

Dominic Gluchowski 12:05

Yeah, I mean, you know, this market only really exploded this year. And, you know, specifically probably since June, it has really gone parabolic, and different different types of art. So the one that excites me the most is, you know, a project like Art Blocks, which is generating profits, it's generated by a computer algorithm. And it's very popular, it's quite beautiful, you can paint this painting on the wall as well, you know, you can get it printed. And it does, it does sell for a lot of money. I can't afford this right now, I love the curated version, but you can definitely jump into different types of artworks projects, which are more affordable. And then, you know, what I see growing really quickly is, you know, kind of like a profile art, you know, something that you can put as a profile picture on Twitter, and then you can identify yourself with that project. And then obviously everyone who also have invested in the project, you know, you essentially become like a community and you have something in common.

So Crypto Punks, is a great example. You know, some of these Crypto Punks are selling for selling for 40 etherium now or higher, as high as million dollars for a profile picture, right. But also, what's happening with that is that people who own Crypto Punks and can prove it and (as a result) they are can enter nightclubs and get boots in America now. So you know, you get special treatment by being part of a community.

With other projects we're seeing that these profile pictures are turning into games and into metaverses where you can use your character to play in a game you know, and in the future, this character probably will be able to will be transferred between different games as well. So it becomes something attached to you as a person that identifies you in metaverses and that's why you know, it's becoming very valuable. And I guess from a from a perspective of crazy prices you know, you can you can buy a flashy sports car and drive around the town and maybe like 100 people see it. Or if you really want to flex and show off you can buy like a million dollar profile picture and the whole world, or at least a million people will see it on the internet, right? So it's just another way of basically showing off your wealth as well.

Nick Byrne 15:00

Yeah, humans a status driven creatures for for some at least. There's a few things I wanted I thought would be interesting to touch on there. So I think it'd be interesting to jump jump into the metaverse conversation. There was a tweet that came out during the week by Chris Dixon from Andreessen Horowitz. And it was really a tweet thread I should say. But it started with his exclamation that tokens are new digital primitives, which are an angle analogous to the website. And then he goes on to talk about how technology generally go through two phases, a skeuomorpheic phase and a native phase. During the skeuomorphic phase we are just really copying what already exists in the real world. So early internet, websites are really just digital brochures or other things like that. But then, as it emerged out of that skeuomorphic phase, we had a native phase and this is where we saw experiences that were very unique to the internet so social media and Facebook and things like that.

So I thought it was a really interesting reflection. Since 2008 or so when Bitcoin came about it's been in a skeuomorphic phase. We've just been copying what exists what already exists in the real world. So money, obviously first and now NFT's has been digital art or digital baseball cards that's been the metaphor used (for NFTs).

But you've just picked on some things that are now signaling that we're transitioning into a period potentially where we have native experiences to the blockchain world. So I think this is the wrapper that's been called the metaverse. So I've even been guilty of like rolling my eyes a little bit at the metaverse comments, assuming this language is just another buzzword. But I actually think it's super interesting.

How would you explain metaverse to somebody that's not familiar with it?

Dominic Gluchowski 17:34

Sure, to me, it's an experience that you can have online, you know, you basically arrive at a website or a destination, we are a little bit limited by technology, I think when VR headsets are become become more accessible and better. And, you know, when the websites and online experiences can in general support VR, that's when we're going to see a huge influx into metaverses because you couldn’t really have that 3D experience, you know, with a website. Now, the 2D is not as exciting, but I guess it's just a space where you go to, and you can meet, you know, people on the player, so you can have an experience, or you can play a game. And I guess, you know, one of the examples is, you, when you when you buy some of NFT art, you can put it into gallery. And then you can invite, invite anyone you want to catch up with you online. And instead of just doing a zoom call, we can just, you can catch up in your gallery, you can play some music, you can show you know, they can check out the art and you can have a conversation there. And it's not just one on one, it can be a group of people as well.

You know, the other obvious use case, which I think is going to be you know what's going to drive everything forward is gaming. So there's some amazing games coming through and gaming as an industry: it's a bigger industry in Hollywood, the music combined, right? So it's massive. I said this already. So what what's different with blockchain is that with blockchain, you can play to earn money, and you can also play to own and when you own a spaceship or a character or a SWAT or a gun or whatever, whatever you buy or your win, you know, you own it, no one can take if off you. And in the future, you'll be able to use it in other games as well. And you can go and sell it as well. Where currently in most of the games, you know, you're either cancel it or you have to sell it on that special marketplace and company that makes a game makes most of the money from it. So yeah, so so that's a that's a difference. That's what's what I see being driving when it comes to VR for shopping, socializing. adds music sports, you know, for celebrities to connect with their fans, you know, that's gonna take probably a little bit longer. Just like, just like Internet took a bit of time to replace mail, right just because it wasn't easy the technology wasn't quite the same with printed newspapers versus online newspapers. Same with having to go to a DVD shop and rent, rent a DVD. And now you can just do it online. So it just takes a bit longer, but it's definitely coming in. I think gaming will drive it (the metaverse growth and uptake).

Nick Byrne 20:38

Yeah. I agree with you, the gaming will drive it. And so what I'm about to say isn't, isn't in disagreement. It's out of curiosity, because as you know, I've spent the last four or five years in digital identity and looking at blockchain digital identity. And the key thing, the key value proposition around blockchain in the digital identity conversation is interoperability. We have hundreds of identity, if not 1000s, of identity artefacts around the world today. And the lack of interoperability and standards in how those identity artifacts are produced, is why it's such a pain today to verify your identity online. And I've found that there's been a real lack of incentive or interest in any of those owners of those identity documents to want to come into this standardized, interoperable world. And so when I look at, say fortnight where a lot of these teenagers and younger are spending their money to create their, like, hyper personalised avatars. I'm struggling to see how we go from these proprietary universes where people have spent all the money in them to accrue their special things to a metaverse where all those special things and now interoperable across games and experiences. So I guess, yeah, I'm curious how about this transition. Any thoughts on how the transition might happen?

Dominic Gluchowski 22:12

That's a good question. I think, hopefully, because it is already built on a blockchain. So everyone connects to the blockchain for a specific use case, for example, to buy a starship. So maybe because everyone is connecting to the same type of blockchain, it makes it easy to also, you know, be able to use that spaceship of character in different games, because of this working over the same protocol. Graphing, you know, with identity, everyone has a different database. They don't want to connect each other's databases because of number of reasons from privacy to security, and regulations legislation, right? So I think, be running on the same blockchain and being connected on it already will probably make it more seamless. But you might be right. Maybe some won't want to do it. And then eventually, I reckon the ones that will win are the ones that will be most open to it.

Nick Byrne 23:19

Yeah that’s it, I was thinking that so maybe Epic Games, becomes incumbent in this conversation. And the new generation of metaverse gaming companies, for lack of a better word, don't yet exist yet. And I will be there'll be building experiences, which are native to this idea that your digital artefacts should belong to you and then portable across experiences.

Dominic Gluchowski 23:41

Yeah, and I'd love to see, you know, identity on the blockchain. I know you were working on the project. Identity in general has been such a difficult thing to sell to corporates right now. But I think, you know, where I see it, accelerating is, if legislation changes and makes transacting through cryptocurrencies a lot more difficult. Like, for example, you have to identify who you're sending money to, I think that will drive a lot of innovation in identity as well.

Nick Byrne 24:21

I see government as the customer of this digital identity conversation, because they're the ones that are producing the identity artifacts. I mean, corporates could become a notariser in that system. So once they've done the initial, classical identity check, they could issue a portable identity document, which, you know, we may one day see in the open banking system in Australia. But ultimately, I think we need like more Estonia type governments around the world to be thinking about what is a digital first government experience look like. And maybe that's when we would start seeing some more Interesting approaches to this problem.

Closing question: Are there any good books, be it nonfiction or fiction that you would recommend to somebody who has just heard the word metaverse and is like, what the hell is that?

Dominic Gluchowski 25:14

No, I haven't read one. However, Real Vision, it's like a YouTube channel, they also have a subscription service that covers the metaverse really well, you know, from an economic point of view, and where it's heading in the future. So Raoul Pal, does a really good job explaining it. I tend to listen to a lot of podcasts on YouTube. If you want to, you know, get into a crazy world of NFT's then Up Only it's a really good podcast. They do have quite a lot of episodes about NFTs. So as Bankless, and I really like Real Vision.

Nick Byrne 25:57

So Real Vision, Up Only and Bankless. I'll type these up so that people don't need to capture them. Well, thanks very much Dom. Maybe we could we'll try to make this a semi regular thing we can jump on and talk about all the fun crazy stuff in blockchain. Yeah, so yeah, thanks very much for joining us. We'll do a debrief in a sec. But this is where I'll hit hit pause. Is there anything else that you want to like what's happening in your order and coins as well that you'd like to follow up?

Dominic Gluchowski 26:24

Yeah, I might just mention, you know, you obviously have an amazing following. Especially in product I really enjoy your blog. If anyone hasn't read it highly I recommended it. I guess at CoinJar we do have a B2B offering and we are helping a number of different ASX listed companies. Some in ASX200 but also smaller businesses in you know, getting into blockchain or into cryptocurrencies. And there are quite a few hackathon projects that basically won. And they're coming to us and saying, Hey, can we make this happen? And we can. So just reach out. We'll be happy to chat.

Nick Byrne 27:04

Awesome, thanks, Don them yeah, I'd encourage everyone to do that coin jar is one of the more trusted if not the most trusted brand here in Australia, and I've been a happy customer for a long time, mostly because my joke with people was that if I ever lost my Bitcoin, I knew who to go on my attack!

Dominic Gluchowski 27:25

I might have to go and move my house!

Nick Byrne 27:28

That's right!

Nick Byrne 27:28

Thanks Dom!