Redline DAO Hotspot Analysis: Where Will "Web3 Hollywood" Shibuya Go?

Written by: Baker, Redline, Redline DAO

Interactive Videos in Web2

Interactive videos are a popular emerging content medium that has gained traction in the past two years. The biggest difference between interactive videos and conventional videos is that viewers can make choices at branching points in the storyline, allowing them to navigate through a story line according to their preferences. If you are a fan of interactive videos, you must have heard of the Bilibili creator known as "Da Ni Ni," who has over 2 million followers and has produced popular interactive video works such as "The Bikini Bottom Serial Killer Case," "The Death of Grey Wolf," and "The Murder Case in Ice and Snow Manor." The essence of interactive video content presentation is to shift some of the content decision-making power from centralized producers to the audience, which aligns with the decentralized philosophy of Web3 to some extent. Today's protagonist, Shibuya, is a pioneer in bringing interactive videos into Web3 (or bringing Web3 into the interactive video space).

Founding Team: The Master of White Rabbit in Shibuya

Let’s rewind to 2020, when Emily Yang (aka. Pplpleasr), who worked at Apple, received the unfortunate news of being laid off during the pandemic. In this dark moment, the visual artist, who had previously worked at Hollywood visual studios and Blizzard Entertainment, recalled the cryptocurrency she had invested in three years prior and clung to it as a lifeline. In 2020, during the peak of DeFi summer, Emily Yang keenly noticed the lack of vibrant artistic expression in a world filled with dull code and numbers, and she transformed into Pplpleasr, bravely diving into the crypto rabbit hole. She created an art documentary titled "x*y=k" for the launch of Uniswap V3.

"Funding in Hollywood is like dealing with politicians; a career in visual arts in Web2 feels like a roller coaster," Pplpleasr said. Despite this personal pain, the harsh reality did not extinguish Pplpleasr's love for anime visual art. After successfully incubating pleasrDao, fragmented concepts such as "Decentralized Hollywood," "merging Black Mirror, anime, Love Death + Robots with crypto," "building an A24 studio in the crypto world," and "allowing users to participate, invest, decide content direction, and become owners of long video content" flashed through Pplpleasr's mind and coalesced into the prototype of the Web3 video platform protocol "Shibuya" (Shibuya, a commercial district in Tokyo, Japan, is an important hub for youth fashion culture and a place where culture and ideas converge. It aims to have many screens and content that everyone can see). Among them, the film titled "White Rabbit" is the first streaming media work released by Shibuya.

Investors: Well-Connected Backers

Shibuya raised $1.5 million through NFT sales shortly after its establishment to fund the early construction of the platform and subsequent video production. On December 8, 2022, the Shibuya project team announced the details of its seed round: $6.9 million in funding led by a16z and Variant, with notable investors including Joe Tsai, Kevin Durant, and Paris Hilton. Notably, this is Joe Tsai's first investment in the Web3 space. The official disclosure stated that the funds would be used to incentivize new IP creativity and creators to join the Shibuya platform, as well as to expand the engineering team and hire professional UI/UX designers, among other things. Source: Joe Tsai Twitter pinned content

Token Economic Model: "Producer Pass" & $WRAB

The Producer Pass is essentially an ERC1155 token. It represents a form of participation in voting/staking, which is also a necessary tool for users to engage in creative decision-making. When participating users hold this pass and stake it on the Shibuya protocol, they can cast a crucial vote in the NPC interactions at the end of each chapter to determine the direction of the video storyline. "The design inspiration for the Producer Pass comes from movie ticket stubs," Pplpleasr explained. "They can serve as a physical record of all the episodes you've watched." Shibuya officially sold a total of 5,000 Producer Passes for the first chapter at a price of 0.08 ETH each and released 5,500 Producer Passes for the second chapter at the same price. For the upcoming third chapter Producer Pass, the Shibuya project team adopted a combination of airdrops (1:1 airdrop for holders of the first two chapters' passes) and mint sales. Currently, there are 2,800 third chapter Producer Passes available for sale on the NFT trading platform Opensea. Meanwhile, the Shibuya project team created a Telegram privacy community through the DegenScore protocol, allowing only members holding the Producer Pass to participate and discuss the content and form of new chapters to ensure confidential content is not disclosed.

"Interactive choice at the end of Chapter 2 of "White Rabbit"

$WRAB, short for White Rabbit, is essentially an ERC20 token. Its ownership represents users' fragmented ownership of video content. When the film is completed, the project team will mint the finished film as a video-form NFT on decentralized storage facilities and transfer its ownership to the community holding $WRAB. Users who stake the Producer Pass will receive a certain amount of $WRAB airdrops (70%). The earlier users stake, the more additional airdrop rewards they will receive (20%, calculated linearly by time). Additionally, users who correctly choose the majority can also receive a small airdrop reward (10%, which has been removed in the V2 version of the white paper) after un-staking. In the overall distribution of $WRAB, 50% will be allocated to Producer Pass holders, 40% to artists, 5% to the platform, and 5% to the project team. Meanwhile, the project team will evenly distribute all $WRAB tokens across a total of 7 chapters.

Source: CoinGecko

It is worth noting that the Shibuya official V2 white paper elaborates on the differences between the Producer Pass and $WRAB. The Producer Pass is defined as a formal voting/staking credential, with the possibility of being destroyed in exchange for an NFT; while $WRAB is clearly defined as the governance token of the White Rabbit DAO, with permissions including voting governance and ownership of the White Rabbit film.

Project Operations: "Endless" Airdrops

High-frequency, high-quality airdrops have always been a secret weapon for NFT projects to attract attention and drive market enthusiasm. In this regard, BAYC pioneered the way (by airdropping BAKC and mutation potions, allowing BAYC holders to enjoy wealth and prosperity). Recently, the 9GAG team has taken airdrops to the extreme in the Memeland project: the first-generation product "MVP" was sold at a high price of 5.3 ETH in a blind box format, representing a premium membership in the Memeland ecosystem, which will receive two Captainz airdrops, with the current Floor Price close to 40 ETH; the second-generation product "The Potatoz" evolved in phases through free mint, during which Memeland also provided players with numerous airdrops: NFTs, iPhone 14, whitelist spots, etc.

Source: Memeland

Shibuya has mastered the art of airdrops. As early as March 2022, in an article outlining the content outlook for Chapter 2, Shibuya explicitly stated that it would provide special rewards to loyal community members who collect all 7 Producer Passes. Meanwhile, in various corners of the first chapter of "White Rabbit," the Shibuya project team uniquely embedded 12 mnemonic seed phrases, allowing "Leidenfrost" level observers to receive fukubukuro (lucky bag) airdrops. The Shibuya project team also indicated that similar mnemonic pattern airdrops would appear in future chapters (greatly increasing the difficulty of viewing). In the explanation of the third chapter Producer Pass, the Shibuya project team clearly stated that users who staked the Producer Pass from the first two chapters would receive airdrops for the third chapter Producer Pass. Additionally, the Shibuya project team generously provided a certain number of third chapter Producer Pass airdrops to members of the Azuki and PudgyPenguins communities (to thank them for their casting collaboration). With the release of the third chapter, the project team also held an NFT lottery, giving players participating in the staking game a chance to win blue-chip NFTs (CloneX, Pudgy Penguin, Azuki Beanz).

Recent NFT prize pool from Shibuya

Although the current quality of airdrops is still lacking compared to predecessors, once the IP takes off, its airdrop value will not be underestimated.

Collaboration: White Rabbit X Azuki

In the official V2 white paper released on September 28, it was revealed that Azuki NFT characters would make cameo appearances in Episode 3. After voting by community participants, Azuki#3602 received the highest number of votes and will appear in the storyline of Shibuya's third chapter. In the Web2 world, collaborations between various fashion brands and trend cultures often create waves, where just the alignment of two logos can attract consumers. Collaboration is an extremely effective way to expand the audience, often achieving a 1+1>2 effect. The video works released on the Shibuya platform undoubtedly serve as a great collaboration platform, as showcasing static JPEGs in dynamic video content can greatly enhance consumer enthusiasm for purchasing. Recently, the Shibuya project team also airdropped third chapter Producer Passes to members of the PudgyPenguins community, leading us to boldly speculate that the cute little penguins may guest star in the fourth chapter of "White Rabbit." With Pplpleasr's personal influence and the Shibuya platform's strong technical capabilities, we can expect to see more collaborations between "White Rabbit" and well-known NFT projects in the future.

Risks: Some Disturbing Numbers

Data in black and white will always reveal some harsh truths. Based on the prices of Producer Passes and minting fees publicly released by the Shibuya project team, we can roughly estimate the amount that the "White Rabbit" project team can "crowdfund" from each chapter. In March 2022, the total of 5,000 Producer Passes for the first chapter, priced at 0.08 ETH each (approximately $240 at the time), amounted to a total income of $1.2 million. However, as the crypto bear market set in and the price of ETH halved, the revenue from the sale of Producer Passes for each chapter sharply declined. Additionally, since most of the third chapter Producer Passes were released as airdrops to pass stakers, this undoubtedly added to the financial strain on the "White Rabbit" production team. Meanwhile, let’s carefully review the timeline of "White Rabbit's" growth. We do not know the production time for the first chapter (the project team may have started production before the IP was released); the public release date for the second chapter was June 9, 2022; and the third chapter went live on January 10, 2023. Based on the interval between the announcements of the second and third chapters, we can roughly estimate that the Shibuya project team takes about 6-7 months to produce a chapter. Coupled with the fact that each chapter of "White Rabbit" is less than 2 minutes long (the duration of the third chapter has slightly increased), this inevitably raises doubts about the production progress of the project team (even though the $6.9 million funding in December 2022 primarily aimed to accelerate the film incubation process). Time is running out for "White Rabbit"! Furthermore, data from the NFT trading platform OpenSea shows that the number of holders for the first chapter's Producer Pass (total of 5,000) is 1.0k, while the number of holders for the second chapter (total of 6,000) has plummeted to 484, and the number of holders for the third chapter (total of 2,800) is 203. The issue of excessive centralization caused by investment-oriented concentrated holdings must ring alarm bells again, which may contradict Shibuya's philosophy of "making community members creators."
TL;DR: From the perspective of production relationships, transitioning from Web2 to Web3 is undoubtedly a significant paradigm shift, moving from a point-to-point model to a networked structural ecosystem. In the Web2 world, over 90% of production relationships are point-to-point models, where individuals often play a single role in a singular commercial environment. For example, in a consumption scenario, consumers are often passive recipients of goods or services and cannot simultaneously play multiple roles such as owner or investor. However, in the Web3 world, the roles of each individual will be further subdivided, and individuals within the same commercial ecosystem may play the roles of consumer, producer, content owner, and investor. This multidimensional role model subtly enhances the quality of Web3 products, as each role does not merely think from a single perspective but integrates multidimensional thinking, leading to more exciting sparks of thought. Shibuya's business logic greatly aligns with this production relationship, as users holding the Producer Pass can experience the storyline before the release of "Squid Game" and indirectly decide the direction of the film's content through staking votes, indulging in the role of "director." Imagine lying on the couch watching a drama, and when the content reaches a climax, you suddenly feel inspired to add a side quest to the story. At that moment, you open your device, connect your wallet, purchase a token, and cast a vote to determine the storyline direction. Does this Web3 application scenario make you particularly excited?

From the perspective of artistic content production, the conflict between efficiency and fairness is a perennial topic. The creation of art often involves a high degree of individualism; looking back at outstanding works of art, drama, and literature throughout history, they have almost all been achieved through individual artistic accomplishments. While collective democratic voting methods can ensure fairness, the majority's choices often lead to mediocrity in the artistic realm, and too many noisy voices may cause artistic inspiration to get lost in the jungle of creation. The Shibuya model may contradict the rarity of art. Finally, the ultimate monetization model for Shibuya's content is also a sensitive topic. Whether through IP creation or NFT sales, the Shibuya official team has not provided any explanations or hints. This may leave community members who staked Producer Passes wondering: Did they just spend money to observe a cultural commercial experiment? Despite various doubts, with Pplpleasr's exceptional talent, the project team's dedication to quality production, and the backing of numerous influential figures, we still hope and believe that Shibuya can make a significant impact in the Web3 video IP space. Standing at the colorful intersection of Shibuya, illuminated by neon lights, do we hesitate in place, or do we follow Elon Musk to pursue "White Rabbit"?

Elon Musk's recent tweet about "White Rabbit"

References:

1. https://twitter.com/shibuyaxyz

2. https://medium.com/@shibuya.xyz

3. https://shibuyaxyz.substack.com

4. https://www.coindesk.com/business/2022/03/01/nft-artist-pplpleasrs-new-project-shibuya-brings-long-form-animation-to-web-3/

5. https://fortune.com/crypto/2022/12/08/paris-hilton-and-a16z-back-nft-artist-pplpleasr-in-7m-fundraising-round-for-web3-video-platform-shibuya/