Matthew Liu describes himself as a "serial entrepreneur" on LinkedIn. As with many tech entrepreneurs, first impressions can be deceiving. Liu comes off as extremely relaxed and friendly. He goes out of his way to appear polite and mannerly. A casual conversation with him reveals very little of his intense resume and immense ambitions.
"I had a pretty nerdy childhood growing up in New Jersey. I've always been into computers and science."
Liu is the co-founder of Original Protocol, a platform on the Ethereum blockchain for NFTs and other decentralized marketplaces. Origin Story is their NFT platform that allows artists to launch NFT collections on their own websites, allowing for more curated and personalized collections. Origin also aims to make DeFi more mainstream. Their NFT collections feature the likes of Ryan Tedder and 3LAU.
Before co-founding Origin Protocol, Liu was one of YouTube's earliest product managers, before the company was acquired by Google. He then went on to co-found Unicycle Labs, an e-commerce platform that integrates with Shopify, and PriceSlash, a bill management platform that was later acquired by BillShark.
Although he studied electrical engineering at Stanford, his education was mostly hardware-related. He has taught himself the core of his current software engineering skill set.
I had a chance to sit down and chat with Liu Miami in December 2021, during the week of Art Basel 2021. We grabbed a table at the Sagamore Hotel in South Beach, where Origin Protocol was hosting a private NFT exhibition that showcased its top artists. Liu was kind enough to put me on the VIP list so I could attend.
The exhibition was about to kick off, so Liu looked slightly distracted. He let out a sigh of exhaustion as he sat down, but he became increasingly focused and engaged as the conversation picked pace.
"After graduation, there were only two companies that I wanted to work for: Either YouTube or Facebook."
Liu elaborates that both companies were startups at that time, and he thought those two firms had the most potential to change the world. Apt prediction.
"It wasn't clear then that they were going to be successful, but I wanted to work for a platform that provided the technology for individuals to create content and connect with a wide community."
I ask him how he feels about YouTube's evolution since he left. He pauses and considers his response carefully before answering.
"In the earlier days, there were more powerful individual creators. The core of their platform was user-generated content. Over time, they've shifted more focus to premium content, which I enjoy, as a consumer. But the tradeoff is that it's now harder for individual creators to get off the ground."
Liu also talks about how platforms like YouTube silo away user data in a centralized database. They depend highly on ads, while creators probably aren't compensated according to how much they contribute to the platform. Also, at this point, it's only the top creators that can feasibly profit from their content.
"It's basically the same situation with platforms like Instagram and TikTok. I think Spotify is probably even more egregious. The economics for musicians and producers are terrible. You need an exorbitant number of streams to make any money at all."
Such issues are what attracted Liu to decentralized platforms and Web3, which makes it more difficult for platforms to act exclusively in their self-interest. With NFTs, the creators issue their own content using smart contracts and get compensated using their own wallets. The platform creator provides the technology and the tools, but has no rights to the content itself, which is a complete reversal from the model of YouTube or Spotify. Also, secondary royalties allow creators to get compensated with each additional sale.
"If I listen to a song on Spotify one time, it's the same economics as someone else streaming the same song a thousand times. With NFTs, artists can tier their interactions with their fans. The person that streams a thousand times is probably willing to pay more for content than the person who only streams it once. The fan who contributes more could get to name a song, for example, or get an in-person experience. The consumption and compensation are more layered."
Liu equates NFTs to HTML, the standard markup language that allows content to be displayed in a web browser. By giving people the ability to express themselves through webpages, HTML enabled the creation of blogging, e-commerce, and social networks. Liu says NFTs are more than just digital art on the blockchain; that's only an initial iteration. He thinks NFTs are a fundamental technology that will incubate new industries.
I ask him to provide an example of how NFTs could disrupt a current industry or create a new one. Liu pauses, then brings up Patreon, a company that allows fans of content creators and influencers to pay for super-subscriptions. These superscriptions offer early access to content, personalized experiences, and other types of special treatment.
In Liu's mind, these super-subscriptions can be replaced with NFTs. The NFT holders can get certain privileges, but they can also sell their NFTs. Ownership of a single NFT could potentially be fractionalized.
NFTs are already changing the gaming industry. With the advent of play-to-earn games using NFTs, people are paying for NFT characters and items that they then use to earn money within the game. This opens up a lot more avenues for people to become career gamers.
"I also think NFTs are going to change the way we look at physical assets. Right now, if I have an expensive painting, it's pretty difficult to sell it. I have to seek out an auction house or maybe a private sale. If I have a Lamborghini or a yacht or a nice handbag or a Rolex, the current way these luxury goods are authenticated and sold is kind of a pain," Liu says.
So I ask: How do NFTs make things easier?
"In tomorrow's world, these items can be represented as NFTs. I could have an Hermes bag stored somewhere, and own the NFT. I could then just sell the NFT, and the buyer could then claim the bag whenever he/she wants, or the buyer could then immediately sell it. There'd be no unnecessary delivery or third parties."
Liu also elaborates on the idea of fractionalized ownership of physical properties. Let's say someone doesn't have enough money to buy an entire Hermes bag or any other luxury good, but is interested in investing in luxury items. You could create an NFT that represents an Hermes bag, a Rolex watch or a Ferrari, cut it up into a thousand pieces, and sell them to the public. The owners then vote on how to store and maintain that luxury item, and can sell their piece of ownership when the NFT's value rises.
You could do the same thing to real estate. Instead of setting up a real estate investment trust, create an NFT that represents the building and sell to it 10,000 people who now all have a stake in a new hotel or stadium.
Sounds grand and all, but as of now, NFTs are still a niche market and most people still tilt their heads when hearing the word "NFT." What needs to happen for true mass adoption?
Also necessary is more adoption by existing companies. Interesting things will happen once larger corporations and brands start understanding the technology.
And finally, a wider macro-level acceptance of cryptocurrencies among the general public. This would require better fiat on-ramps and simpler wallets that are easier to use. People also need to become accustomed to the idea of using digital currencies that are not tied to a central bank.
In other words, a long way to go -- but Liu thinks we'll get there. It's inevitable.
"Non-tech people tend to think in linear terms, but disruptive technology always grows exponentially. You hit a certain point and the curve just takes off."
I shift the conversation to Origin Protocol itself. How does Origin fit into his overall vision? Liu explains that the foundational idea behind Origin was to bring all types of commerce on to the blockchain. The idea was that you should be able to buy or sell anything with crypto.
They soon found, however, that their approach was too broad. They decided to narrow it down to early adopters, which naturally led to NFTs as a focus. Once again, the idea was to broaden the user base. Anybody should be able to use tech to create and sell NFTs.
Liu also wanted to create a platform where individual creators weren't fighting with each other for space and exposure.
"Platforms like Nifty Gateway and OpenSea are more like Amazon. There's too much volume, and it's all on one site. The user is overwhelmed. Our vision is more akin to Shopify. Creators can sell on their own sites and deploy their own smart contracts."
Eventually, Liu wants to create a powerful developer ecosystem that allows third-party developers to build on their platform. He wants people who desire ultra-personalized experiences to be able to interact directly with their API.
"Basically, the vision is: You control the experience. You sell on your own terms. You figure out how you're going to run things, as opposed to the platforms that pretty much dictate the entire process."
Origin is currently working with K-pop star Henry Lau on an upcoming NFT drop. I ask him if he has any wider interest in Korea and the Korean market. Absolutely, Liu says.
"Right now, Korea is one of the major exporters of cultural content around the globe. Fans of Korean entertainment are among the most rabid in the world."
Liu thinks K-pop fans are the perfect candidates for all the new business models we've discussed. NFTs that give superfans backstage access. An NFT that would let you have dinner with Henry, or be a character in Hitchhiker's next music video. NFTs could even offer superfans the opportunity to co-produce a song or have some creative input. These are experiences and interactions that superfans haven't been able to buy.
K-pop fans are already famous for their eagerness and dedication. They purchase exorbitant amounts of merchandise. (A Vice article reported that the average BTS fan spends over $1,000 on merchandise and concerts.) Fans have also been known to raise funds to put up billboards and public signs that honor their favorite artist's birthday.
Hitchhiker is a Korean DJ and producer who created a music video especially for Origin's private NFT exhibition in Miami.
"Korean fans and artists are the best for exploring new concepts."
I ask him if Origin has any plans for further Korean projects. Liu doesn't give too many details, but he says fans should expect more collaborations with celebrities and companies that have a lot of intellectual property (IP). He also hints are more features on Origin’s Story platform that enable more use cases.
This article was originally featured at Digitally Yours,. Digitally Yours, introduces notable NFT artworks.