Lets Talk NFTs

Grab your drink and get ready. This is the caffeinated hustle, the best place to learn about entrepreneurs and FTS and life expert advice and guest interviews to launch your business and NFT journey further than you ever imagined. Now, here's your host, entrepreneur, coffee fanatic and founder of the NMT project, caffeinated creatures, Ben Carson. Hi there. Welcome back to the caffeinated hustle. I'm your host, Ben Carson. thanks for stopping by sticking with us continuing on this journey together. All right team. Today we're going to talk part one of a two part episode all about NF Ts. The first part is going to be about the history what they are. Maybe some things you haven't heard of before, even if you know what NF T's are, I suggest you just stick with it. I think this one's going to help. Part two is going to be all about the caffeinated creatures and what our specific project is. So let's dive right in and talk about one NF T is an NF T is known as a non fungible token. Basically, anything can be an NF T through blockchain technology. But we're going to talk about realistically things that are digital that have value that have utility that have purpose. And it's just it's a very unique technology. It's very new. First off, one of the newest, or one of the oldest NF T's is crypto punks. And that came out in 2017. There's a few projects before that. But one of the first mainstream ones is only four years old, five years old. It's not ancient technology. It's just it's, we're very early in the entire process of NF T's. By but some form of NF T's are here to stay. Now, this could be 1996 1997. And a big, massive, massive bubble is coming and it's going to pop and it's going to bring down everything with it. But some form of these NF Ts, this technology is here to stay forever. It is just it's a game changer when you truly understand it. So let's talk about what an NF T is. I think the best way to describe it is through a hybrid of sorts, but non fungible token. The best definition I've heard of that came from a podcast, Tom, Billy who was on he's the guy that started Quest Protein Bars, really established entrepreneur, check them out if you don't know who he is. But he basically said an NFT is non fungible. And that means that if I have to $10 bills, and you have a $20 bill, we can exchange and each of us still ends up with $20. And there's no harm. It's a fungible transaction. If, however, I don't know if this part came from him or something else, but basically, I've heard this said enough that I'm just going to quote it through him. And if not, I apologize. But the same goes if you go to see the Mona Lisa. And afterwards, you go to the gift shop and you buy a replica for $500, even just a really high end replica, and you go back to the museum, and you try and switch the Mona Lisa out with a replica. It won't happen. People will not allow it. It is a non fungible transaction is a non fungible piece of artwork. The Mona Lisa is rare, it is one of a kind, it cannot be exchanged for a replica. So when you hear about NF T's, you hear all these people saying Why would I bother spending 1000s of dollars on a piece of artwork, a digital image, when I can just right click save and have the exact same thing. So the thing is, is if you believe that an NF t is non fungible, then it's not able to be replaced with something else. Okay? If it's fungible, it is. So if it's a fungible token, it's just an image. That's all it is. And so, yes, if it was a fungible token, you could just right click save, have the copy of the image that was screenshots or saving the picture. And you could have the exact same thing that the original person has, if it's an NFT, a non fungible token, it's one of a kind, it cannot be replaced, and its value is legitimate. And so when the project board ABR club came along, they meant it out in about 12 hours, they sold their entire collection out raised about two and a half million dollars. But they started to gain hype, they started to gain some really unique perspective and celebrities, athletes, all sorts of people started to jump in. And now because the project minted in April of 2021, and we're currently at April 2022. In about a year's time that project that company has done a billion dollars in sales on the open market, because it's it's just an insane appreciation and insane growth rate compared to most companies, but the value was there for the SP Because NF T's when you have them truly designed properly, and NF T is a one of a kind piece of art, a one of a kind thing that offers a utility with it. If it's just really high end artwork, then maybe that's enough. And the utility is the artwork for most NF T's. However, the NFT grants utility beyond just the artwork. And so in the board APR club instance, the artworks decent, it's not super high end, but it's unique. It's one of a kind, and it started to get a following. And as it got that following more and more people that interested you had celebrities, you have athletes who had high net worth people buying into this thing, and the utility became the exclusiveness of the community. Now they have real life events that you can go to if you hold a board of Yacht Club, if you do not have one of those tokens, if you cannot prove ownership through the blockchain, that you are actually part of this community, you have no access to get in, in real life events, digital events, the ape coin, all sorts of things going on all through access of this original NFT. And so in that case, you can't just right click save, because even if you have a copy of the image, it can be proven immediately. So let's think about fake Rolexes. Let's think about fake designer bags. If you make it really well, the best of the best can tell that it's fake. But most people can't tell the difference between a fake designer bag and a real designer bag. On the blockchain, it can't be faked. So you can prove ownership within seconds. And you can't fake it like you can. In Web two, which is basically the real world we're at right now. You can't fake web three and blockchain technology the way you can everything else. So these designer Rolexes that are getting copied and the initial Rolex cost $20,000. And the fake costs 200. If you make it well enough, it's hard to distinguish, you can't have that issue on the blockchain. And that makes it different, it makes it technology that moving forward will be around forever, because the premium the real stuff can't get copied anymore. Like it could in the past, even though technically, of course, you can just save the image. And it looks like it's you've copied it and you have the same thing initially, no problem. But when you are required to show proof that you actually own that before you get access to whatever that NF T provides. Suddenly, it's a game changer, you can't do that. And that keeps you out. So NF T's provide all sorts of utility, that every project has a different utility, every project out there now these days, is trying to give you an option to make it stand out to make you resonate with the community to give you something unique. So NF T's provide, of course, artwork, of course access and of course utility, the best projects out there should have all three, access to a unique community of like minded individuals, unique artwork that makes you proud to show it off, and utility. That's one of a kind. Now, what's cool about NF T's is that, beyond just that, when you are done with whatever you wanted, whatever access whatever utility, whatever you felt like you wanted out of that NFT. What's different about NF T's and the web three technology versus anything web two, is that you can sell it back. And so let's think about like this. So caffeinated creatures, which we're going to talk about next episode. But they allow you access to education, to entrepreneurs, to events, things that can really change the course of your career if you're interested in it. But when you're done, if you've learned what you needed, if you've launched your own business, if you made the connections and you're no longer wanted, even if you spent a few $1,000 to get in. When you're done, you can sell it back to someone else. Now, it doesn't guarantee you a positive return. But if you spend $2,000, in education on web two, if you go to any of these course creator websites right now and spend that money, that money is gone, it's an expense to write off, if you have a business, you're not getting it back in web three, you have the potential to sell this to someone else. And that's a game changer because it allows the people that aren't looking to take advantage of their community. They're just looking to provide real value and offer a way out if you want. Web three lets you do that. And so that's what attracted me and my team to web three to allow us to do this because I've had the ability to do a course on finance or a course on print on demand for quite a while but I've never wanted to go down that path because selling my information and my education and my experience. And of course that cost someone else $1,500 And when it's done they have nothing to show for it but more knowledge is really a downfall if people are trying to go all in and it takes so much just to get through the Door with the NFT, you can get through the door, learn what you need, and then sell it at a potential profit, breakeven or loss, but get something back in most cases and use it to keep going. So the only thing left when I was considering this approach was if we're going to do NF T's, are they securities because if you're doing something where you're basically allowing someone to sell something on an open market, it has similarities to a security. And so I looked into this heavily, because the biggest differentiator between web two and web three is the fact that you can resell it. If you have a QR code, you can gain access to a membership site, you can do all this education stuff, but you can't sell your access to someone else in web two, it's only possible through NF T's. And so the downside of that is, well, if you're doing something like this, where you're selling something for profit, is it a security. And so I went through the SEC, because I used to be a traitor. And I made sure without a question without a shadow of a doubt that if I'm going to do this, if I'm going to put my team through this, the SEC has not ruled against NF T's, it cannot be a security or I'm not interested. And I found a very unique document that really explained everything for me, and I will link it in the description. But basically, it talks about NF T's and the Howey Test. And if you don't understand what the Howey Test is basically, in the 30s, how he was a guy that was trying to sell orange groves, he was trying to sell a passive income project. And the SEC shut him down. And he was trying to sell it to people that probably shouldn't have been invested in that. I mean, you have accredited investors for a reason. If you're putting your entire life savings into a company that has no chance of actually working out, it's a high risk. And if you don't have the ability to do that, you probably shouldn't be doing it mean, the SEC is not out to hurt you, they're trying to help you to a point, I totally agree with everything to a point, I get frustrated by the red tape along with that stuff. But it's just it's the world we live in. So you got to play by the rules. But in those rules, there's a lot of gray area and case in point with NF T's. Because straight from this website, which is in the description, they use the Howey Test to determine if an NF T is a security or not. And to make it a security, you have to have three things, you have to have an investment of money in a common enterprise, with the expectation that profits will be derived from the efforts of the promoter or a third party. And so the thing is, is that you could probably classify quite a few things under the Howey Test. If you really thought about it high end Rolexes or high end watches in general, designer, bags designer, almost anything probably. There's always a secondary market that lets you excuse me flip these for more than you put in. And at what point do you cross the line between just trying to get your hustle on and buying into something that if there's enough of them, does it become a security. And what it all comes down to is part three of the Howey Test. And they take this further and I'm just going to read this directly from this paper for you. Basically, the third part of this is that the expectation the profits will be derived from the efforts of the promoter or a third party. Basically, if someone else is making you money for you, it's more or less passive income. And that's what they're talking about. So let's take this further and read this directly from our website. What they're saying, if an NFT relates to an existing asset and is marketed as a collectible, with a public assurance of authenticity on the blockchain, it should not be deemed as a security. If an NFT promises a return on investment from the efforts of others, the NFT could be deemed as security. However, as noted by the SEC staff and its 2019 framework, price appreciation resulting solely from external market forces, impacting the supply and demand for an underlying asset generally is not considered profit under the Howey Test. So here's the takeaway for this, anything could probably be considered a security, but the SEC is not in the business of trying to handcuff you. They are not trying to shut you down and prevent positive gains. They're not they're not in that type of business or trying to just shut down the bad people. There are a lot of scammers out there that are trying to take advantage of you. If you are investing in a project that is offering you passive income you are buying into a business if you're buying into a business, it needs to be regulated by someone. The SEC exists to regulate businesses to ensure that they do not fraud investors. If you're buying into an NFT project to have some sort of utility, whether that's education, whether that's access to someone or a group of people, whether it's the artwork anything like that, then if the price of the entire project the floor price which is the cheapest price available for this for any NFT in that in that collection. If that floor price raises so the entire collection goes up in value and you make a positive return on that. That is due to supply and demand that is due to the market conditions no different than buying a watch going out there. Basically getting a watch from a shortlist or waitlist, something like that, and then walk into the door and go into a building across the street and selling that for double what you paid for it. That's possible almost constantly buying 100 pairs of shoes and flipping them overnight and making substantial profits. That's possible. But that doesn't make it a security, the market, the supply and demand determines what that price is, you are not buying passive income, you're actively doing something to make it work. And that the supply and demand justifies a profit for yourself. It is not a security, the Howey Test is very vague. But the SEC has clearly decided that without passive income, you're okay, don't buy into the passive income projects don't bind in the projects that are paying you simply to hold it that are paying you parts of the profits of the business that is no longer gray area, you are now clearly breaking the rules. And if your project gets caught, it gets shut down. Don't do it. I mean, you're allowed to do it's your money, do whatever you want to do. But just think about the fact of why you're getting into NF T's. And if you get the right one, it's going to provide education, it's going to provide access, it's going to provide some phenomenal things that could really help your floor price, long term increase due to market supply and demand without giving you a guaranteed return passive income, anything that blurs the lines, the caffeinated creatures is doing just that. And we're very excited about what we're going to do. And we'll talk about that in the next episode. But I want you to understand that we went about this in a specific way. For these very reasons. We're looking to help a lot of people we're looking to offer, education, utilities, things that you can't get any other way. And we're looking to make sure we do it in a way that keeps the project going long term. And FTEs are here to stay whether you like it or not, the technology in some fashion will be here in the next 20 years, it's not going to go away because web three has opened doors that weren't possible before. It's brought in potential for new people to do things that that weren't around last time, you don't want to take advantage of people. And this gives you the option to not take advantage because people now have a way out, they aren't stuck sitting on something they can't get out. They're not required to be part of this, if they want to leave, they can leave open see is the biggest platform out there. And it does millions of dollars a day. It is a unicorn company it was founded only a few years ago, and the amount of transactions is done is astronomical. But it's because it allows an open marketplace for everyone to buy and sell NF T's anytime they want. And when you have the ability to buy and sell in the open market, and you're not required to wait an X period, you're not required to be stuck into something that if you made a mistake, you will never get your money back. There's of course channels like that. But the marketplace allows the option for the everyday consumer to do what they want with their money, get in enjoy and get out. And that is what's special about NF t's the ability to get out. You can't get out in web two, you can't buy into a course, you can't buy into a mastermind you can't bind to anything and get anything back. In Web three, you can get your access, get what you want. And if you're done with it, and you no longer need it, there's a chance to get out and it changes the game for everyone. It makes everyone more efficient. It makes the best projects rise to the top and everything else fall to the floor. And we're very excited to be in this because we are going to rise to the top. So with that I look forward to explaining what caffeinated creatures are in the next episode. Or very shortly if we decide to split this up a little longer, but I appreciate your patience and a little longer episode than normal. But I hope I explained NF T's in a very unique way. And I look forward to talking to you soon. Bye. Thanks for listening to the caffeinated hustle sponsored by caffeinated labs LLC. For more information or to connect with Ben, check us out online at caffeinated labs.io. Or email us at support at caffeinated labs.io. Be sure to subscribe so you never miss an episode, or give us a follow on social media by checking the links in the description. We'll see you next time.