Ornella Hernandez

<div id="highlights-block_628b5d4acb361" class="highlights">
 <ul>
 <li>Mainstream adoption of GameFi has significant hurdles to surmount</li>
 <li>Users need better information and education around Web3 promise and pitfalls</li>
 </ul>
 
</div>



The three-day Permissionless conference, co-hosted by Blockworks in Palm Beach, Florida, brought together developers, business leaders, policymakers and builders within the crypto and blockchain community. Alongside panels about institutional investing, liquid staking and stablecoins, were discussions about NFTs, the Metaverse and gaming. Here are some of the highlights.



<h3 class="wp-block-heading">The promise of GameFi&nbsp;</h3>



The GameFi space, referring to blockchain games that offer economic incentives to players such as play-to-earn, is a nascent environment where the goal is to attract new crypto users via gaming. According to Angela Dalton, chief executive officer and founder of Signum Growth Capital, most traditional AAA game publishers are “too scared” to get into GameFi. Those publishers that have experimented with NFTs in their existing games, like Ubisoft, have <a href="https://cms.blockworks.co/ubisoft-nft-efforts-are-off-to-a-rocky-start/" target="_blank" rel="noreferrer noopener">received considerable backlash</a> from hardcore gamers.



“I think that the traditional game publishers are analogous to CBS, Viacom, Disney when Netflix came along, and they&#8217;re just holding on to their IP, and scared to enter this space,” Dalton told Blockworks.&nbsp;



Ken Timsit, the managing director of the layer-1 blockchain protocol Cronos, echoed the sentiment. “If you take a group of random people, and you try to give them a blockchain, or force them to eat blockchain, and they&#8217;re not hungry, it&#8217;s going to be tricky,” Timset told Blockworks.



In light of the rug pulls and scams that gamers have been subjected to, some backlash and skepticism is warranted. However, Mirko Basil Doelger, the chief executive officer and founder of UniX Gaming, pointed out that the current gameplay and infrastructure builders are “pioneers” and it is up to them to set the pace.



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">“How fast we make progress. How smooth is the entrance? How much do we attract our new audience?” </blockquote>



<h3 class="wp-block-heading">Web3 brands and their communities’ needs</h3>



Since launching the <a href="https://cms.blockworks.co/coinbase-unveils-its-social-nft-marketplace/" target="_blank" rel="noreferrer noopener">beta version of its NFT marketplace</a> in April, Coinbase has revealed its vision to be a social entity marketplace. According to Coinbase’s chief marketing officer Kate Rouch, this means combining elements of a transaction platform like OpenSea or Rarible with the social aspects of a social network like Twitter or Discord.



She added that Web3 creators are in need of better tools to communicate with and market to their audiences and communities, and Coinbase hopes to fill that need.



Coinbase was one of the presenting sponsors of Permissionless and celebrated its 10-year anniversary as a company this week.



Similarly, Jeff Carvalho, co-founder of the Highsnobiety brand and the Web3 consultancy Burrata, agreed that “as much as we chase floor prices” when it comes to NFTs, better marketing campaign experiences are necessary to onboard more consumers into the Web3 space. Especially as fashion, music and art culture converge, “keeping that community engaged is evermore difficult,” he added.&nbsp;



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">“There have to be better rails or on-ramps to get the average consumer to come in here where they&#8217;re not worrying about a smart contract or getting exploited by it,” said Carvalho.</blockquote>



<h3 class="wp-block-heading">Sovereignty over our digital identity&nbsp;</h3>



Another theme that came up throughout the conference is the idea of having true ownership over our social graphs and control over our digital assets. According to Evin McMullen, a ConsenSys alum and blockchain advisor, “consent is really important when it comes to our autonomy, and only an enthusiastic yes means yes to interacting with my data.”



Ethereum co-founder Vitalik Buterin and others have <a href="https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4105763">argued</a> that so-called “souldbound tokens” (SBTs) — NFTs that cannot be transferred once received, and are held in a wallet forever — are essential to Ethereum’s future because they “establish provenance and reputation.”



McMullen disagreed. “The autonomy of these [private wallet keys] comes from our ability to separate ourselves from unwanted assets,” McMullen said, referring to SBTs.



In addition to autonomy and consent being central to the ethos of blockchain, so are privacy and security important to crypto wallet users. Ledger’s vice president of product Charles Hamel said on the Permissionless stage that Web3 is all about “decentralization and user choice” and that clear signing for NFTs and DeFi will be essential for wallet safety.&nbsp;



People want more than just cold storage of bitcoin and crypto from their hardware, explained Hamel, adding that there is a growing need for users to know exactly what they are signing when executing on-chain NFT transactions.



He presented the crypto hardware wallet manufacturer’s own browser extension, <a href="https://cms.blockworks.co/cryptos-future-is-self-custody-dealing-blow-to-exchanges-ledger-vp-says/" target="_blank" rel="noreferrer noopener">Ledger Connect</a>, which enables users to connect their hardware wallets to Web3 applications such as Ethereum and Solana.



<hr class="wp-block-separator has-alpha-channel-opacity"/>



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Angela Dalton

Permissionless Web3 and NFT Trends, Takeaways

Casey Wagner

<div id="highlights-block_6287b7c9b0ea0" class="highlights">
 <ul>
 <li>Ledger, predominantly known for its crypto hardware wallets, plans to add a cryptocurrency wallet extension on Safari</li>
 <li>Coinbase CEO Brian Armstrong, meanwhile, said he’s expecting users to more seriously consider taking their assets into their own hands</li>
 </ul>
 
</div>



As retail and institutional interest in digital assets grows, wallet providers are betting on crypto holders taking ownership of their assets.&nbsp;



Self-custodying digital assets is the “future,” said Charles Hamel, vice president of product at crypto hardware wallet manufacturer Ledger. He added that ownership is “really unique and esoteric to the things we are building.”



Ledger&#8217;s hardware wallets allow users to store digital assets directly on a USB drive while securely controlling their private keys, as opposed to web-based or software wallets. 



Exchanges are also starting to think about the role self-custody and ownership plays in the current digital asset landscape, Hamel said.



Crypto holders increasingly want to keep their assets themselves, often for fear of misplacing their private keys and losing their funds forever, he said. As a result, exchanges have started offering self-custody services, often for a premium fee.



Coinbase CEO Brian Armstrong said he expects users to more seriously consider taking assets into their hands. The exchange now offers self-custody wallets and soon will give users the option to do so directly through the app, Armstrong wrote in a recent <a href="https://blog.coinbase.com/embracing-decentralization-at-coinbase-7fa0e5d1084b" target="_blank" rel="noreferrer noopener">blog post</a>.



As investors become more comfortable with the technology, concerns swirling around possession and security are becoming paramount, Hamel said.



“The products that the most crypto-forward people are using today will be used by mainstream customers in a year, and by institutions a few years after that,” Armstrong wrote. “We need to start integrating them today.”



Ledger unveiled plans to add a crypto wallet extension, Ledger Connect, on Safari that will allow users to connect hardware wallets to Web3 applications such as Ethereum and Solana.&nbsp;



“We want to reduce the friction for ledger users to bring their keys to Web3,” Hamel said.&nbsp;



Security is likewise key when it comes to self-custody, he added. Ledger Connect plans to add a new security layer, “Web3 Check,” Hamel said, which intends to flag suspicious Web3 apps. Users will be alerted if an app is linked to past scams, hacked websites or fraudulent smart contracts —&nbsp;the latter are on the rise as decentralized finance protocols rise.&nbsp;



“Having something in your hand is essential for people — the tangibility of it is really important,” Hamel said.



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Get the news in your inbox. Explore Blockworks newsletters:



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<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha in your inbox. Think like an analyst. </li>
</ul>

Charles Hamel

Newsletter

Blockworks Research