IlluviTalks #17 - GameFi: Web3 Killing Retail?, Tokenizing The World & Apple’s NFT Tax (GizmoSlip, Hitha Herzog & TSG)

How can digital and physical retail co-exist?  NFTs?  Digital add-ons? Why did GizmoSlip sell your $700,000 house for crypto (and stocks)? Apple is taking 30% tax from Web3… will this work or fail gloriously?

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Hitha Herzog - https://www.hithaherzog.com/ + https://twitter.com/HithaHerzog
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TSG - https://www.youtube.com/tsgilluvium

ABOUT THE GAME
Illuvium is an exploration looter and collectible autobattler game built on the Ethereum Blockchain, releasing on PC and Mac in 2022. Play and earn in a graphically-rich, vividly-realized sci-fi adventure and conquer the wilderness to help your crash-landed colony flourish.

Race across stunning alien landscapes on your quest to uncover the cause of the cataclysm that shattered Illuvium. Hunt and capture Illuvials, powerful creatures who have ruled the land unchallenged until your arrival. Train and fuse your Illuvials into powerful evolutions. Build your ultimate Illuvial team to take into battles and tournaments in PvE and PvP Arenas. Use your creativity to build unique synergies to outsmart your opponents and progress to the top as become the most legendary Ranger on this planet.

Illuvium’s collectible NFT games feature crypto token assets with functionality and a gaming use case, interoperable across the Illuvium universe and the larger DeFi metaverse. The decentralized NFT collection offers players a user-maintained custody never before possible in mainstream gaming.

#illuvium  #gamefi 

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Transcript

foreign [Music]

[Music] all right let's do this everybody welcome to illuvatox the show where we lead the conversation about the crypto nft and game fight Industries my name is Andrew wall host and executive producer at eluvium in today's episode is going to be mind bending it's going to be mind-blowing we have some of the smartest people on the internet here with us today web 3 is it gonna is it killing retail we're going to be tokenizing the world and Apple's got a 30 nft tax holy moly Med has gone a 50 tax how do we move forward as an industry those are the topics we're talking about today and it's very important that all of you understand that nothing we discuss on the episode today is financial advice this might be a part of your research listening to incredibly good looking and smart people like me and my guests sure you're a genius for doing that but it didn't Financial advice but you already knew that because you're watching the show which means you're smarter than the average person speaking of smarter than the average person a dear friend of mine I've worked with for years let me just line this up for you Heath and then I'll bring you in here Heather Herzog have you seen her on CNBC maybe have you seen her on Fox maybe is she a professor at Parsons in New York who knows wasn't she on the cover of some magazine you've seen her on she's a finance analyst for Tech talk top tech companies and finance companies you cannot believe everything this woman has done and she's here as retail expert and finance expert to drop bombs on us today heat the Herzog in the house what's up my friend hey my friend it's so good to see you and thanks for having me here I'm excited to discuss all things web 3 and what retail is going to be indeed I'm very excited to discuss that with you we also have a couple other really exciting guests including Brandon from gizmoslip you may have seen his videos on YouTube 600 million times Brandon on the show what's up buddy I'm glad to be here uh thanks for having me on the show looking forward to discussing the topics today perfect and also we've got our maybe the most enthusiastic person there is in the defy and gaming space I have to bring him in these conversations can get maybe too serious we need his youthful energy he's a ray of sunshine for the gaming and defy space obviously eluvium's influencer managers who I'm talking about tsg in the house what's up buddy yo what's happening it's your array of sunshine I take it I'll take it I appreciate you um I appreciate you having me on man and I'm really excited to have the the chat with with the with the other people with the rest of the panel I feel like it's gonna be a good one it it better be a good one otherwise I'm booting you guys off the show permanently viewers I guarantee you will learn at least two new things on this episode about technology if you don't never watch the show again so the first topic we're going to talk about today is is web 3 killing retail okay well perhaps it is perhaps it's not let's just give a little bit of context here and then we'll bring in the retail expert on the show so some headphones some headlines not headphones headlines you may have heard is some headlines are saying e-commerce hasn't killed physical retail in fact it's more important than ever says this piece probably by someone who has a stake in the retail industry check you might have seen physical retailers like GameStop launch a nft Marketplace understanding that they're obviously their physical gaming business needs to be complemented by this new digital web 3 space and we're seeing basically a grappling of digital sales and digital platforms eating into the profits and the revenue of physical retail we've all seen it in our own lives how many times have you ordered stuff on Amazon or digital retailers versus physical a lot more as each year passes so heatha I gotta kick it over to you you study this every day you are maybe the world leading expert on on retail with web 2 players like Amazon coming in taking business with kovid coming in taking business now web 3 coming and taking business is digital technology gonna just straight up kill retail what do you think you know I don't think retail will necessarily die right we always need things we need to purchase items we need products I think you are correct though when the pandemic happened there was a real bifurcation between the the consumer that goes went into stores that were even allowed to go into stores here in New York we were under a serious lockdown everything had to be sent to our homes um I know other places in the United States and around the world it was a little bit looser uh but you know those people that had to get everything sent to their homes we kind of got used to that and that you know setting that that infrastructure and making that happen seamlessly so retail didn't lose business took a lot of effort and to dismantle that why why fix something that isn't broken right so suddenly we're seeing the consumer buy differently and even when you see this it's not just the Giant Stores it's not like the Walmarts or the Amazons of the world it's also smaller businesses so I'm sure a lot of your viewers out there probably run their own small businesses uh you know I'm a also a fellow at a think tank in DC called the data Catalyst Institute how do you have time to do all this you're in these think tanks you're a professor how the heck do you do all this you're a finance analyst you run your her your H2 media business you do all the financial publishing stuff with me is there like do you have a twin uh I don't have a twin but I do have twins I have twin toddlers I have a lot of help people I've gotta say there's no way I could do everything that I do without a ton of help and very little sleep but I know that I mean anyone with small kids you know right but I was saying that the rule even rules sell sellers small businesses are getting on the bandwagon of e-commerce so this isn't uh this isn't something that that is going to go away anytime soon so I think it's not necessarily that it is killing retail but in one sense it's evolving it and we as consumers and people who are creators need to evolve with it so um and I think that's what's happening with definitely the people that are watching we're looking for new ways to to to make our craft and sell it so this is certainly a platform that you could do it on I'm going to give you the first crack on the follow-up here heatha and then I want to give it to our other guests on this because I'm sure we've all got opinions the follow-up on that is okay it's evolving retail is is what you're saying I agree but can physical and digital retail if you will co-exist uh and I understand we're moving toward that so when you talk about e-commerce you're talking about web 2 Commerce right now we're moving into web 3 Commerce which even more so than e-commerce takes out the centralization it takes out the middleman it makes things even more decentralized so is the coexistence of digital and physical retail moving forward is it nfts is it buying going into the store buying a pair of shoes and getting a digital add-on on top of that what is the coexistence scenario where web3 helps retail grow and doesn't just let's say demonetize it into Oblivion so as we know retail as a retail as we know it now and web3 right can they coexist as we know it now I would say no but again we're talking about the evolution of this right and we're talking about the evolution of the consumer so you know 10 years I mean how long has iPhone have iPhones been around for like what 15 years 18 years now maybe my math is off yeah it was like 2004 or so it came out somebody Google that so we're we're approaching almost 20 years right 20 years ago we wouldn't even think to to look at our phones to to have many computers in our in our pockets right the same thing is going to happen with retail and web3 we don't know that we need to go into an alternate universe to maybe get an add-on for a special pair of Nike you know Air Jordans if you're someone that wears those or if you're someone like me who really likes to buy a lot of Gucci items when I have the money for that um maybe I want something that's rare and a collectible um we as consumers don't know we need it until it's put in our face and it's easily accessible so right now when people are using web3 it's not accessible to everyone that's how technology happens it starts with people who are very very evolved and very very technologically savvy I.E the people who are watching the stream and us and then it becomes less and less difficult to access uh it becomes easier it becomes democratized and once we see that democratization that is when we're going to see that coexistence of web 3 and physical retail uh hang together got it let me ask uh there was a good answer tsg I got to kick this over to you so do you see a world where you go out go buy the things you like to buy do you see yourself um going to that physical retail store and maybe having a better experience or being incentivized to physically go somewhere because there's a digital add-on or because there's a digital tie-in or because there's an nft tie-in to the physical products that you're buying to your Digital Life do you see that being a boon or do you see that being dumb and gimmicky and what's the point I'd be curious to know what your thoughts on that are yeah so uh this is pretty funny because I didn't leave my house like I just don't um and I think I think that that's going to be the same but like a lot of people moving forward like time is the biggest city right now right like a lot of us as things go on we're just working harder and harder time is the most valuable asset so I'm not saying that it's impossible um but and maybe maybe like the people the two like super top tier of society where they have an abundance of time maybe that that does it for them but I think for the majority people for the mass uh for the masses that nft or that digital add-on needs to be hell of an add-on it needs to be like next level to incentivize people how often do you guys have uh what to you guys but how often do we know of people that say they they get invited to a party and they're kind of hoping on the last minute that it gets canceled or something like that right just because they don't want to leave their house so that's by hanging out with friends and now you're saying I want to go on bike I fit a lot and I even actually um I asked my wife because I I know I don't go out and buy things but yeah but legitimately I only go downstairs to buy some water every day like that's the only I go to the gym I go downstairs by water that's all I do but I ask my wife to prepare for this as well and I was like yo I I don't go out like that well and I don't I don't go shopping but what about you like out of like out of 100 how much of your shopping is online well you gotta delivered to you like clothes and everything like that and how much it like an actual retail store and she was like 80 80 is online and for a female to buy I don't know maybe uh you can tell me but for a female to spend 80 of her her purchasing online to me crazy just because I I would have assumed that they'd want to try it on and make sure is that normal yeah no it's absolutely normal I'm telling you the way that we shop um and let me just you know if we're gonna be gender specific I know that there's this whole idea of women like to gather their friends and Link arms and because through the mall and shop and drink and you know have a day uh you know it sounds like the 1990s I don't know I haven't seen that I haven't seen that this Century that's my wife though I'm not online that's why my wife said she doesn't go out yeah I can't get together it is I mean it's impossible to just get my phone my friends on a phone call how can I get them out of the house to go shopping and to be quite honest um you know and I'm gonna take a page from what you said it's just time consuming it's if you think of the return on investment leaving the house getting in your car getting yourself cute going outside it doesn't make a difference you could hang out with your friends over a nice dinner and get all of your clothes sent to your home now one thing that I think everyone should understand too is that retailers are realizing that people are getting all of their stuff sent to their homes we try them on in our homes and then we leave or are we excuse me we return them right so now retailers are going to start charging a return fee for those returned items it's called bracket editing So when you buy a ton of stuff and get it sent to your house and try it on um you know to quote Taylor Swift hi I'm the problem um that's what I do too and uh and and I send that back and and right now retailers because it is so hard to deal with the returns they can't quite seem to get the back end you know ahead of the front end with the selling uh they're gonna start charging people so that's one thing that's a little bit annoying but yeah no one goes who goes and shops with their friends anymore I I certainly don't yeah and wow I mean maybe we're a unique group here of uh you know try hard work from home self-employed type people and so we're a certain type for sure all three of us right uh I want to kick this over to Brandon uh so do you see I haven't thought I had a thought on tsg your question asked you asked tsg there about the add-ons you get from like say an nft add-on to something that you buy in in retail um I think the key there is is really like uh when we reach Mass adoption we with web3 technology and say everyone gets a web 3 identity the same way you have a driver's license maybe it's even a officially government backed or certified at that level of adoption I think is when we're going to see real advantages to the web 3 technology and integrating web 3 products with let's say luxury purchases you buy a Gucci purse or a very expensive car you might get access to some VIP lounge that's specific to an nft or it comes with digital asset ownership as well but there's going to be way more levels of integration in the future if web3 is fully adopted especially on a governmental level on an identity based level um which we may or may not see in the near future right it may take a long time but eventually well I gotta I gotta cut you off there and and I got to cut you off really quick and just show you uh what's happening already today look at this shot so and I just visited Australia on a business trip they are already have a digital identity system in place so when you go to Australia they don't use pieces of plastic or cash or checks to interact with each other everything's on your phone so you go create if you're an Australian citizen a digital identity for yourself it's on your iPhone and you just Boop your identity everywhere you boop your payments everywhere no one inserts a credit card into anything you just Boop with your phone so digital's identity is already here this is not necessarily on the blockchain but it's already here right and it's adopted by tens of millions of people in one of the most significant countries and economies in the world so this is I just want you to know this is already here and it's already working and this is not some fantasy future uh I see this thing the way it's going would we say that that's web 2 or would you say that that's web 3 though right that was probably web 2 technology versus web3 that's the key difference I think there and the level uh that it's a centralized identity versus a decentralized one or at least ties into a decentralized network or interface which is going to be I think the key to integrating with other web 3D products and Technologies so we'll have to see how all of that plays out but it's really cool to see Australia doing that full digital online identity because that's key right to being able to integrate all of these digital products um and integrate them to the real life physical um yeah I would say something that web 2 Tech you're seeing there is a bridge I think to the web 3 version in the future I think the next step for governments around the world is have a centralized digital identity then eventually there may be a decentralized digital identity maybe maybe not uh governments obviously don't want to let go of that power let's move on to the next topic because you know we're talking about people uh spending all their time in their homes going all digital well you want to talk about somebody who went all digital with their homes Gizmo slipped Brandon here sold his home for 700 000 says your thumbnail I'll pull it up right now and uh you sold your home for seven hundred thousand dollars for crypto and stocks you're freaking crazy bro so you got to tell us why did you do this why are you funneling your resources from let's say a physical assets over to crypto this is a you know this is kind of a crazy headline type of story but it happened in real life and who you are so so why did you do that so primarily I would say the the number one factor was trying to time the market as best I could and also in combination with I wanted better diversification of my assets um of course I have a 401k I have a retirement funds I own stocks uh but I also wanted some higher risk investment um in my portfolio and uh and I do plan on buying another house so give it back that the interest rates were skyrocketing with the FED that it was pretty easy to predict the housing market decline which is already declined 10 to 15 percent in most of the United States so when you're looking at um the housing market basically I sold right at the tail end of the bull market for the housing market um right before the interest you nailed the time good job yeah so um that was the key part of it and then I wanted to be able to buy the dip and I wanted some some liquid uh cash to be able to buy that dip and I have been buying the dip and so I have been buying the juicy ilv dip as well notice my alluvium background here so you do have the coolest Studio out of all three of us I got it so so you want it so you convert it to your physical property you're looking to convert it into digital property and there's more and more stories about uh this going both ways I also follow a YouTuber it's called digital asset news and he went the other direction in the crypto bull market last year he sold toward the top his crypto so that he could buy real estate so obviously yeah we can see this going both ways so I want to bring this up because this begs the question of the tokenization of assets in the future you I just went through the process a couple years ago you just went through the process and I bet a lot of our viewers have gone through the process of working with multiple middle Mana deed companies some legal company a mortgage company a realtor the government there's like 7 000 third parties coming in here charging you tens of thousands of dollars for you to just sell your house that you own so is there a better way well some of the ideas out there include uh What uh folks like Digi shares is doing uh basically tokenizing real estate is what they're aiming to do I'm not saying they're pulling this off and I'm not recommending them but they're looking to tokenize real estate so that you could sell it on the blockchain you could avoid the third parties and potentially you could split one piece of real estate let's say multiple ways and have multiple owners and this has been an idea that has uh captured the attention of many people out there but my understanding based on my research is cool idea we could see this happening in the future fractionalized real estate that type of thing but you need the government to buy in so the question I want to ask you guys uh and I want to kick this over to heatha First is Will governments allow the control of things like real estate Deeds uh to become decentralized wouldn't they be putting themselves out of a job and to my knowledge all government workers and politicians want to do is expand their scope and expand their jobs that's how you succeed this seems like this would put a lot of governments local and state primarily out of business what are your thoughts on tokenized real estate a thousand a thousand percent and you know I'm part of your group we didn't really sell we had didn't we didn't sell a home but we bought our apartment you know almost 10 years ago and then I had to completely gut renovated so you could see this beautiful Studio that I'm sitting in that looks like uh um you know it literally is a room that I'm sitting in sorry about the background but uh but uh but it's a beautiful gray wall remember I was going through all of

and uh you know we had some bureaucratic I mean it was so ridiculous I had to pay someone 500 to just basically check like some sort of piping or something it was just so dumb and he had to keep coming back and it was more money so to answer your question I I think you know the government has a tendency obviously to want to save themselves and save their jobs and you know if tokenization meant the elimination of that definitely but I really am a firm believer in blockchain and in blockchain being the foundation for uh transactions like real estate and also not to take it back to the retail discussion but I just want to mention there's one thing when it comes to buying luxury goods and you know you could probably Loop real estate into this because obviously we're dealing with you know hundreds of thousands of dollars worth of of land at some point unless you're buying land in New Mexico in which case it's like 45 000 if you go out way out into the rural areas but um you know you're you're dealing with things that are worth a lot of money and yeah that blockchain is able to you know obviously it's still it's nice and staged but once we get there you are going to be able to see that provenance and I think that is what is so important about this and uh this is what I love so much about uh blockchain when it comes to luxury items uh you know I wrote my book Black Market billions and I followed the money trail of uh stolen luxury items and how that funded a terror cell in Latin America uh so when I saw blockchain kind of come you know emerge as something that people were interested in kind of having it be a little bit more user friendly I thought immediately here's a solution that makes sense and when it comes to real estate at the same time it really makes sense to do this again I don't think we're there yet I think this is a very very early stage but the fact that we're even having this conversation now means that something is brewing and I want to ask you Brandon did you sell your house before uh what's his name Blankman freed decided to go bananas with the FTX

fraud so I sold I sold my house in April this year so it was it was quite a few months ago like November yeah and I've been I've been putting my money incrementally into crypto over time as as the dip occurred so yeah so this wasn't an all-in hey honey trust me this crypto thing's gonna work out let's just sell let's sell the farm or whatever this was a calculated move that makes sense so this so thank you for bringing that up Isa oh go ahead go ahead and I was gonna say my girl was on board with it all actually she was uh she was 100 she she is also uh into crypto as well so it's kind of nice having a web 3 uh life partner as well um regarding your question right of uh will governments allow controlled real estate uh to become decentralized and would they be putting themselves out of a job I I do think that uh governments are probably not going to be very eager to give away control of property especially because that essentially makes up the land of their country um but I think that there will be integration between web through technology what web3 tokenized real estate and and centralized government entities but it's It's tricky in the United States there's actually been a home sold as an nft for 175 000 already in Georgia um and it happened through a company called roof stock which they they sell real estate um to reset retail investors already so they've got a lot of experience but they did a specialized deal where they did a kyc in depth with a specific person um this guy basically got special approval to do this deal and then they set up an LLC as a special vehicle to be able to handle the to manage the the ownership of the real estate property and then whoever owns the nft basically owns that house in real life the the LLC is legally required to basically transfer ownership legal ownership to whoever owns the nft so it's already happening here in America that happened last two months ago I believe here in the United States but but it sounds like the LLC is acting as the smart contract so if the LLC wasn't in place nobody would honor the fact that that nft gives you the rights to the deed and so the company is the Smart contract so it's not really on the blockchain it's just the LLC is pretending to be the smart contract in this example right am I misunderstanding well I mean it is technically you could the person who bought it bought it with one click you know um okay so it was kind of like buying it on the blockchain but not all the way it's like a it's a paired paired relationship between a real life entity and a web 3 entity and I and I think that that may be the short term for integration and then maybe we'll have a fully unified integration later on down the line because I think it's going to be a step step-by-step process I understand your question though Andrew I mean you know when you you there's a there's a side to the argument that says that we need regulation on this you know who's to say that you know when you're doing a smart contract who's regulating that smart contract I mean sure you can get a bunch of people that we trust and we say well they know what they're talking about and here's the group that has decided in in a sort of democratization way that this is what the contract looks like but um what's to say that you know Generations down the line uh you know let's take me for an example my great great grandkids decide to to sell a property that I had bought on the blockchain and that wasn't really regulated by the government that there were wasn't any sort of legal recourse for someone maybe what if someone what if someone Alters it you know what if there's a way that in some scenario it gets hacked and it's altered uh so I understand there's a there's a in one sense we need the regulation and another it's like well why you know let's just eliminate it I don't know I'm I'm on the fence with it yeah and one interesting item to what you're talking about the uh risk of having something like real estate or any property on the blockchain like physical property rights on the blockchain uh let's say you minted it on Solana and then Solana doesn't exist 20 years from now you're handing down nothing now to your kids so where where does that property exist if that blockchain is no longer operational so that's another thing where we're so early in this space even big names could just vaporize and so that's another challenge with tokenized real estate of course now of course things like this can to be migrated and what have you and you would need humans to intervene to make sure that property is not lost but you know it's not impervious tsg I got to kick this over to you we've been talking about real estate most people can't afford to buy real estate yeah I mean other uh items there you go do you see other items um being popular or interesting to be tokenized other physical property to be tokenized for people to purchase for people like you that don't want to leave your home do you want to buy tokenized physical things and what might those be yeah yeah so um in regards I'll I'll talk about the real estate thing a little bit and then I'll move on to I think tokenizing smaller items like like you say because we are so I think it's going to take baby steps um tokenizing smaller items and then kind of working up as we as we as a space we as an industry become more as a technology become more mature something that I do want to address that you mentioned about um Regulators not wanting it to go forward because it's going to take jobs away if we follow that logic that would mean that they're very against AI as well and it's and we know this like being in that technology industry at some point they just like it's going to be way more efficient to do it with AI and people losing jobs than it is to not do it that way so we follow that that logic they might be against uh like the tokenization of real estate and things like that because a lot of the middlemen are going to lose jobs but at some point it's going to make so much sense that they can't say no to that so that's my opinion on that on that in regards to the actual tokenized uh tokenization of other objects I think collect like digital Collectibles not like pfps and things like that um but one thing that I I'm like a big part of like the not a big part but hip-hop is a big thing that I've been a part of and I know something like sneakers like like there's a huge sneaker culture collection there so and we also know that there's a lot of like uh fakes and also I live in China so there's a lot of fakes out here like you see Yeezys everywhere none of these are real so if you actually have like an nft or something that that's tokenized that actually verifies the validity of the authors like the authenticity of it I think that's probably gonna be the first step so if you do buy it you buy the nft you buy that peer-to-peer and then that gets sent to you and that verifies that it's a real thing I think things like that is probably going to be um where we really start to see adoption first and then it's gonna go up into like slightly bigger things and then there are other things yeah nfts uh yeah so there's already there's already a company my former boss created this one doing exactly what you're talking about for sneakers it's it's basically sneakers minted on like Solana or whatever blockchain they chose so that this is already happening for sure and it's easier to get something like this off the ground because governments don't care about stopping people from selling sneakers on the blockchain because that doesn't take away their jobs um whereas something like real estate would uh so exactly I agree the small ball items being sold with a digital tie-in is a much easier transition for the industry or what about something like this guys and this is what we were talking about in my class right as I was you know Andrew mentioned that I'm part-time faculty over at Parsons I teach a class on Technology Innovation and Innovation I should say uh but this case study that we were looking at was uh identifying this company that was basically putting a um this sounds crazy but a digital DNA into Colombian emeralds and diamonds so uh I'm assuming everyone here is married uh maybe if you're not or even if you're an audience member that isn't married I think at some point we are going to start seeing uh luxury items not just sneakers and collectibles but diamonds real jewelry have this digital DNA that is based in the blockchain that's what this company was doing and I wish I could I should have sent it over to you the screenshot it's okay that's a cool concept though that opens up your mind to the possibilities I didn't think about it injecting let's say uh digital identifiers or tags into premium items like gem gems and gemstones you could maybe see a similar concept with jewelry maybe even precious metals or other items of value right and and I think it it definitely when you start talking about the social implications of purchasing diamonds from a mine because you know when you think about oh well you know is am I having a good social impact where does that what do you mean by that I mean how was this diamond manufacturer was it was it were the people that were mining the diamonds taken care of how much were they paid these are this is all information that could lay within that that ledger of blockchain that you can then see or have a record of and that provenance when you obtain that that diamond or Emerald or piece of jewelry I mean I think of the way and I know none of us have ever probably bought jewelry from a Sotheby's auction but when you do uh at one point I was hosting a show over at sotheby so I know this but when you when you do purchase something whether it's art or jewelry they give you a long list of provenance who owned it before uh where has this this piece this luxury piece been and you know and who has owned it and I think uh as we evolve with the blockchain and when we think about that tokenization that is one thing that that really uh that makes me focus on that and especially too what happens if your house gets broken into and all of your your your sneakers get stolen your your Collectibles get stolen or your engagement ring gets stolen your your wife's wife's um you know girlfriend girlfriend or you know I don't even know um that big diamond ring gets stolen this is one way that you can be able to make sure that you're tracking that so tagging tracking and identifying similar I mean we do not a blockchain version but we do this with pets right now yes um by putting tags into the pet so you can identify the pet and obviously the whole tracker technology is in the caveman stage we now have mass commercial products like Apple Air tags that do something like this but you have to have a physical disk so having that embedded in all sorts of property is a brilliant uh way to potentially digitize physical items without I think that's the connection that maybe is tough for people to accept that you're telling me that this nft or this digital let's say receipt for this physical item is uh valid well it is valid if the digital let's say receiver end of the equation is embedded into the physical item so let's say your house you really opened up my mind here for things like tokenized real estate what if in the foundation of that property in the concrete you have an F and nft transmitter whatever it's called baked into the building you know now now there's a physical connection literally to the digital world and that is an interesting concept it actually makes sense yeah happy to be here happy to be here Perfect all right let's talk about our next topic headwinds to all these cool Concepts actually happening what do I mean by that well let's talk about our friends uh Mr Tim Apple um that was one of my favorite names gaffes of Trumps uh Apple is charging a 30 percent nft tax my friends guys Post in the comments and in chat who's in favor of a 30 tax on nfts uh on your iPhone you guys love it I know you do I know you do and so the reason why I bring that up is that this is blocking a lot of the crypto industry nft industry and the game five space think about it on the game gaming side everybody if uh if apple is going to charge 30 in terms of gas fees on every nft transaction on phones what does that do that makes it drum roll please impossible to transact nfts through their Marketplace so what does that mean it's literally impossible if you know about gas fees to charge 30 gas fees the gas is transmitted on the blockchain so to get the 30 gas feed they'd have to charge 30 percent of that on top as an extra tax to then give to Apple that's dumb and Apple has shut down access to coinbase wallet because coinbase wallet was transmitting nfts and they said you can either turn that off or you can get out of the Apple App Store and so this is basically uh putting the nft industry or the blockchain industry on ice with apple providing no real solutions for people to transmit digital assets to each other on 50 of the phones in the world so let's talk about this because this is huge and this also ties into meta's move which we all saw with meta and this was people laughed about it but they were dead serious meta wants a 50 cut a virtual asset sales in its metaverse they don't want 30 they want 50 come on in we'll take half of your business and half of what you work so hard to create is this good is this going to help the industry let's ask our first question Apple taking a 30 tax from web3 is this going to work or fail gloriously tsg damn uh yo that's tough like for a lot of the other times I've been on here and and a lot of my feelings have been that it's good for them to have a um for us to have a centralized Medifast right because I feel like it's going to onboard a lot of people but with this it's like you're there putting multiple padlocks on the first doors even getting in so I don't know like a sane human being is not going to be willing to pay 30 or 50 that's just mental like it's just wild so I don't know what the play is here I really don't know what the play is here are they going to come up with something specific to them that has a less like lesser V and oh yeah I I honestly I think you're heading the right direction there you lot you went to the next logical step so if you're gonna make it impossible for people to do business in a particular sector on your platform why would you do that yourself so either number one you're maybe you have legal considerations right perhaps come on Apple can just Lobby their way into anything they want give me a break they're worth 2.3 trillion dollars or they are planning on getting a slice of the bat pie themselves so Gizmo slip do you feel like this is going to succeed Apple making it difficult if not impossible to transact with digital assets what are your thoughts my my thought is that these companies are going to find ways to bypass you know Apple Google meta tax in some way you may you may be able to play um a game like eluvium on an Apple device at some point but I doubt it will be going through the app store or alternatively there'll be ways to transact maybe in the Safari browser um you look at a company like Spotify they launched an audio book service recently and to be able to sign up for the audiobook service you have to click a link inside the app that then takes you to Safari browser where you do your payment system so it's it's like basically a way to bypass the existing uh payment system the Apple the Apple tax you might say so you may end up something like that it's like okay you want to do this trade and the luvium you click click this button then you go to the browser do the trade with your web3 wallet then you go back into the app where the trade has already happened in the background and you've got your new alluvial or whatever so I'm not sure exactly how it's all going to play out but I think there are developers are taking notes our blockchain team right now is taking notes they're like yeah

it's just it's not feasible for something like alluvium where the value is supposed to be baked in for the consumer because you're supposed to be able to buy an alluvial and then you you don't want to have to pay a 30 tax when you sell your alluvials that have a lot of value yeah and what if there's no gas fee so if you're on a near gasless platform like IMX what's the fee for Apple to take Okay so let's say it's a fraction of a penny we want 30 percent of that fraction of a penny it's like what so the technology is getting better and better gas fees are going away they're becoming a thing of the past so the whole model of taking gas fees as a way to tax the nft industry it just doesn't make sense on multiple levels he thought I've got one for you so Apple isn't doing this with stock transactions for example they're not doing this to Robinhood they're not doing this to Fidelity app they're not doing this to the multi-trillion dollar stock market industry they're not doing this to eBay they're not doing this to all sorts of marketplaces that are selling all sorts of things that are maybe like similar adjacent to the nft or a digital assets Market if you were to speculate why are they targeting this space and not those isn't there a lot more money to be made in the stock market what are your thoughts I think it is a double-edged sword when it comes to this and I'm not trying to speak in generalities but hear me out on one hand we don't want government regulation as nft creators or purchasers of nfts to come in and tell us what we can and cannot do right and on the other we want government regulation to put down their foot when our nfts get hacked and stolen and you know when we have to fight on who owns what so uh I think I'll answer that question first and then I'll answer the question about why Apple doesn't tax you know the financial markets but uh I think we have to determine as purchasers of nfts and creators whether or not that is going to be worth it especially now to your point Andrew this is a nascent industry for the most part I mean for us it's been we've been in it for a while so it doesn't seem that new but for someone like my mother who's 77 and she's like what's an nft do I need this there's people out there majority of the people out there like that so will this tax be less and less and less over the next five to ten years for sure but then we have to think about the philosophical question what role does government play in all this now Apple um and when it comes to taxes too you know alluvium is based in Australia so um are we talking about a global tax on nfts are we talking about uh you know a global tax on on uh transactions because uh from what I understand the tax varies from country to Country so uh you know why Apple doesn't tax the markets I mean that's exactly comes down to it uh you know the U.S government the the US markets are regulated in a totally different way than let's say you know the ftse in London and the Hang sang in Hong Kong so when you do transactions it's going to be very very different um it just comes down to Federal Regulations per country and then obviously we get down to state regulations I want to bring up the whole tax the Amazon tax per state that we talked about many many years ago when I say we we collectively as a country talked about because I was on air talking about this on television I don't know if you and I talked about this Andrew but I remember you talking about it when we were producing shows Amazon but yeah Amazon state tax that was going on per state so let's say you know we're in United States I know we're the show is probably being watched globally uh but if you have a tax-free holiday let's say at the beginning of you know back to school you go out there shop for things for your kids and you happen to be in Texas and you purchase items in California well you're not going to get that tax-free holiday so that there are a whole lot of factors involved here and that is why I think it is really important as creators and as purchasers that you understand what the regulation is where you are based because it's going to vary from country to Country and and Province to Province Province and and state to state so um it kind of comes down back down to the consumer and the Creator I know that's a very general answer that no that that is great insight to have I I just wanted to point out one thing though so they're saying apple right now at least to U.S uh vendors they're saying you need to use our payment system to be able to transact to get digital assets but their payment system does not support crypto yeah that's the part that isn't that it doesn't fit exactly in the narrative you're saying so if they had a functional system that could work and they're just implementing nft taxes based on jurisdiction cool but their system literally doesn't support crypto and so they're saying You must transact using our system but it doesn't work and if it did work we would take 30 percent sound good oh take your app off our store we're gonna shut you down well and and they also do this thing where they say well you know what we have the distribution if you want your app to be seen we will pump that up and we will make sure that everyone in the App Store sees that and you're going to get more uh transactions and more customers but hey those transactions to your point Andrew they have to be done in US dollars or whatever uh you know centralized currency you're using and um and then we're going to take that tax on it so you're absolutely right it's it's beyond ridiculous there's other platforms that you can buy and sell and create your nfts and have those purchased on with crypto but uh Apple has that that they hang that that that thing over Creator said they dangle that carrot we'll we'll go ahead and distribute that out for you you get the eyeballs but we're going to take that tax it's the it's the eyeball tax it's the gatekeeper model Brandon I want to kick this over to you and I want to ask you if you're interested in speculating about Apple's motivations uh so the reason why I bring that up is obviously there's rumors of their AR VR headset and that being in development and they have lots of patents that have been filed websites things like that it's obvious that apple is investing into this right exactly what they have planned we don't know for sure so I want to kick this over to you is this a part of the equation here with the Apple tax is that they don't want to be giving market share to other players in a space that they're planning to launch into hard I'll kick it over to you since you're so familiar with the technology side just I'll let you speculate I love I love I love VR and I think Apple will probably create the best AR VR headset because they have excellent camera technology which would make great mixed reality they also have excellent chipset technology um for their processors like like they're the best processors basically the most power efficient most powerful processor per watt compared to Intel and uh Snapdragon there's lots of advantages to these apple chips and so I think they'll make a great AR mixed reality or VR headset that'll be very high resolution um and probably have a decent battery life and comfortable ergonomic but it'll probably cost like two thousand dollars be very expensive that said um yes I do think that you're you're going to look at uh Apple is going to be looking to compete in a space I think the key here the key here for an app like Olivia and other web3 um companies trying to sell digital assets the key here is to try to get them categorized and not in that 30 Apple tax because obviously Apple doesn't doesn't charge a 30 tax if I sell my ilv on the binance app right the markets are not taxed with that 30 tax including the crypto markets uh Market apps but the but at the moment you start selling the nfts they start taxing it so that's that's the key and I think we want to Lobby Apple um maybe try to get some kind of a lawsuit going as a community or something because it's just it's not going to be feasible or realistic to have apple charging 30 tax when the rest of the metaverse is not on that tax so why would anyone be transacting on the Apple platforms they do all their transactions off platform and then come back are you trying to start a class action lawsuit live on my show that's that's crazy well I'm just kidding I'm kidding but I mean it's who's jumping in on this classic lawsuit who's coming with me uh I mean no I'm just I'm speculating but I think it is one of the only ways we might be able to get apple to change their mind on on this to reduce the tax to a reasonable Level under five percent is the I think the maximum that could probably realistically charge but um it's tough it's tough it's tough to get them to change it because when you have the users you have the power and unless the government steps in it's it's tough to get a company that has a monopoly on these users to change their mind right so that's I think that would be the key approach there do you guys remember that that's in uh old school when I forgot his name but he's running down the street naked and his wife is behind him he doesn't realize he's like come on if streaking I feel like that's what gizmos uh he just tried to do that uh legal he tried to do that in the legal space yeah uh Will Ferrell it was Will Ferrell running down the street Nate come on

no one wants to take on Apple's legal Team all right here's everybody's chance to provide your final thoughts on these topics and I'll give it to tsg so two-parter buddy give me your final thoughts on these topics and then tell everyone where they can find you on the internet if they want to hear more of your Genius thoughts that only come from your home and not from The Real World not from outside yeah I know what's happening outside um yes so my final thoughts regarding I'll kind of hit them all off so regarding the real estate thing I think there's real value and real Merit to what's happening I think we're just very very early um and I think we will get there it's just going to take time and it's going to take smaller chunks in regards to the tokenization of items I'm actually more excited about the tokenization of our communities and and like membership cards I brought this up with you before Andrew on this podcast I think things like that are actually going to onboard people more than like specific items I think you're referring to like Starbucks stuff the the yeah gym membership Starbucks I feel like things like that um they just make a lot more sense to onboard people um fast that's my thought there and in regards to the whole Apple thing yeah I I still believe that they're kind of just doing this to kind of keep everyone else out until they get their things ready and in line for them to take that shot so that's kind of where I'm at um I don't I'm most interested in in the the the two topics of tokenization and and what apple is doing I'm not looking at real estate I'm just interested from a an outside perspective uh but it will be cool to see how how that works I think that will change the fabric of of like how we do things like in regards to society cutting out middlemen like that I think that's just one example of of how that could work uh but anyway yeah I'm not gonna take too much more time a way to find me I've got a YouTube channel obviously uh link is going to be in the description tsg alluvium oh there you go you got it I've been going pretty pretty crazy with the concept recently but yeah otherwise dude look at these thumbnails man you got the one star review here you got the YouTube face over here Snoop Dogg and alluvium click bait I mean seriously man well done I mean that was that was uh the Komodo dragon that was you I mean I went off your words did you not say this was heavily Snoop Dogg and inspired I blame you for that one man I said Snoop Dogg and uh inspired I didn't say Snoop Dogg was in a movie but you know what you're playing the game and I'm proud of it I'm playing the game well done thank you Brandon Gizmo slip I heard that's a thing you have the logo in the background where can people find you and what are your closing thoughts on this topics so my my tech Focus channel is gizmoslip Tech which you can see here it's just youtube.com gizmosliptech um where I do tech reviews on computer products um and then my main Channel gizmoslip I haven't been posting as much content there but I probably will in the future um my main closing thought on uh on this topic is that any any industry that has heavy uh fees heavy annoyances to them like buying and selling a home buying and selling a car I think these are probably going to be the most heavily incentivized markets for uh web 3 adoption eventually but the integration is still far off and I hope that it it does happen eventually but there's so many there's so many there's a complex issue and so there's so many issues to address regarding home ownership recovering a lost asset um smooth transitions government tax uh pay making sure that any dividends that the property earns are being paid out in in tax liabilities for all everyone that owns the token there's so many different layers to the cookie and to the onion if you will that it's going to be difficult to unwrap this and make it a thing in reality but I think people are highly incentivized to make it a thing and so it will eventually happen most likely I think it's just going to take time great thoughts heatha where can people find you other than literally everywhere and what are your final thoughts literally everywhere well I think the best way to find me is on Twitter I am fairly active on there although I haven't really updated today so you can always find me on Twitter or you can hit me up on my website heathaherzog.com uh I am there yeah see oh that's a that's me there we go yes that's me uh correspondent and my shoes wow fashion able in parentheses look at this branding New Yorker look at you thank you thank you yes um when it comes to retail I want everyone to think about this statistic this is from a recent study I worked on with Oracle called the happiness uh research report this actually came out a couple a couple months ago but 45 of people uh in the last two years haven't experienced happiness so 45 of people that we interviewed so with that said people are going to try to make themselves happy any way possible and there's a whole thing about retail therapy people when people go shopping it makes them happy but also when people hang out at home and with their Creature Comforts it also makes them happy too so do I think that web 3 or web 2 or digital uh Commerce is going away anytime soon definitely not this is just going to add to the happiness of people and how they basically make themselves feel better we are experience a lot of Economic headwinds and just emotional headwinds um so I think that is definitely not going to go away again rural sellers small businesses here in the United States on average are making about 65 000 from digital sales and third-party marketplaces this is from the other study I worked on at data Catalyst Institute so this is again not going away anytime soon so I think that aspect of retail is here to say uh when it comes to tokenization I told you about these luxury items um and for someone that has researched investigated and uh you know followed criminals that steal luxury items and sell them on the black market this is a real solution that makes a lot of sense is the technology there yet no but will it get there yes and then of course when it comes to taxes it's that age-old uh you know this double-edged sword that we deal with you know do we want government intervention do we not again we're at a nation stage of this whole thing so will I do I think that tax will eventually go away for sure is it painful now for sure her that's such a good point you know all of the rhetoric over the last two years since I've been following crypto on the regulation side is uh we want the government to stay out but we also want them to provide regulation and then now uh that the FTX debacle happens Celsius Voyager they're like where were you at well in one one side of your mouth they're saying you're saying stay out of my wallet not your keys not your crypto and Libertarians go go I've got guns in my home and my safe and all that type of anti-government rhetoric and the second something bad happens it's like somebody fired Gensler because he effed up so you can't you can't have it both ways and I think that's a really good point and the thing I want to tell everyone oh go ahead I was gonna say the key there I think is you want to protect the users and Empower them well not restraining them with regulation that's kind of the approach I would try to recommend um for for crypto regulation so an impossible balance yeah there he is I love that it's an impossible balance that sometimes you can get into the sweet spot and then for the most part somebody will always think you're doing it wrong you know there is one thing I want to tell everyone and that is go to eluvium.buzzsprout.com to listen to the audio version of this show on the go I edit it make it sound great so that our genius gas sound even better go check out and subscribe on literally every single pop every single podcast platform in the entire world alluvium.buzzbrough.com I want to thank all my guests for joining me on the show today I really appreciate your time and we've got a special live stream coming up literally tomorrow evening where we're going to be revealing for the first time a full hour of Overworld gameplay uncut with our senior development team here in eluvium it's scheduled on the channel be there get notified that one's going to be fun and I'll see you in the next episode of a louva talks that one will be alluvium Insider adios everybody and I'll leave you with a little bit of original soundtrack music from eluvium as we cut out here see you guys

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