by Patrick Mayr and Brett Sun
NFTs have played a central role in bringing web3 mainstream by proliferating the ownership of culture. Sports cards, digital art, metaverse land and the like, are now instantiated on public blockchains as NFTs, which are digital assets that are truly user owned and tradable across global and liquid markets around the clock.
The advance of culture as an asset class has created the opportunity for a new type of investment fund to emerge — Blackpool. Blackpool is a community owned investment fund that runs a variety of investing strategies in the NFT space.
One of Blackpool’s strategies is investing into play-to-earn (p2e) games through its scholarship program. The prohibitively high prices of NFTs required to participate in p2e games can become a barrier to entry for players. Blackpool levels the playing field by buying the NFTs upfront and lending them out to players. The players then use the NFTs in games, subsequently splitting any generated earnings between themselves and Blackpool (in favor of the player).
Blackpool started its scholarship program with Sorare, the fantasy football game, where managers were capitalized to build out their card collections and deploy them in weekly fantasy competitions. It has since expanded to other p2e games such as Axie Infinity, Cometh, Footium, and MetaSoccer.
Additionally, Blackpool has ventured into buying high-end NFTs such as individual Hashmasks and pieces of 3LAU’s Vinyl Collection. The strategy here is to buy a collection of increasingly valuable artefacts that become cornerstones of Internet culture.
At the moment, these NFTs don’t have any additional yield generating utility unlike the NFTs used in p2e. However, going into the future, we expect emerging protocols to increasingly unlock latent utility and yield generated opportunity for this asset class. For example, enabling an NFT to be used as collateral in a DeFi-native loan.
One of Blackpool’s distinguishing features, compared to classic investment companies, is its structure as a decentralised autonomous organization (DAO). DAOs are software-native organisations owned and controlled by their members. Anyone online can become a member of Blackpool and contribute their creativity, labour, and capital towards improving the larger organization.
By structuring itself as a DAO, Blackpool can harness the full power of the Internet to tap into global pools of human talent and financial capital. When investing into an asset class as wide ranging and distinctively human as culture, that is arguably the superior structure.
We’re excited to be partnering with Blackpool in their journey to build a category defining fund across the NFT space, that is both owned and run by its members.