# Inside the Decentralized Media Revolution | Zack Guzman - Trustless Media

- Channel: [Ethereum Denver](https://streameth.org/ethereum-denver)
- Date: 2024-10-09
- Duration: 20:08
- Topics: blockchain, web3, ethereum, Entertainment
- Watch: https://streameth.org/watch/yt-pDDGDqA4r04
- YouTube: https://www.youtube.com/watch?v=pDDGDqA4r04

## Description

APPLICATIONS FOR ETHDenver 2024: #YearOfTheSpork ARE OPEN


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## Transcript

ized media Revolution with yev muchnik from launch legal and Zack Guzman from trustless media awesome thank you very much um yeah thanks for joining my name is yev muchnik I am a corporate and securities attorney based um out of Denver we have a um Boutique firm called launch legal and we have been servicing clients in the web 3 space since 2016 um our focus is really non-traditional shared ownership structures uh like Dow cooperatives um and then also trying to find like a happy me happy and compliant medium um with fundraising and non-traditional Capital structures yeah and and I'm one of y's clients I should say because we we partner with them to launch coinage and trustless media my company which is for the first time I think I'd like to say y's up here so I can say legally compliantly growing community-owned media between creators and their fans to unleash the network effects of what we're all here to talk about what web 3 is all about what crypto I think is all about um and I've been covering it I was at CNBC and Yahoo finance as a as an anchor and quit to dive into this because I saw everyone having fun with nfts and realizing the power that is here and now building in the media space uh so excited to chat about why we work together and and build this as something that now the co-founder of Netflix is also backing uh so I think we're up is some pretty cool stuff I will shill hard but it's legally incompliant is is what I will say so you all are members if you apply to attend the event for free you're all members of a DA Cooperative as well called Spork Dow um and it's structured very similarly to coinage um the the the governance structure is decentralized it's all about member contribution and member inputs so you receive Spork in exchange for your contributions as as a spor down member um and similarly to to coinage co-op which I'll let Zach dive into a little bit more on on the economic structure yeah I mean just backing up right I think you know there are a bunch of we were just talking on a panel this morning about Dows and the power of community in web 3 it's really hard to just do it compliantly and legally and and not have to worry about some of these concerns that I think you know coinbase is over there they know some of the concerns um but I think you know basically from a media perspective everyone understands that media is broken I think that's fair to say Elon Musk tweets about it all the time uh we're seeing Publishers Under Pressure we're seeing journalists laid off that's my background but there are really interesting ways to now monetize creativity online and Dows have been doing that for what five longer than five years um and co-ops are essentially just legal Dows and so I don't know it was really cool to launch coinage last year um with the ability for rft holders to Mint and legally co-own what is now one of the fastest growing media outlets in web 3 um so that's kind of like where the structure came from and it's not just coinage obviously there's a bunch of dows out there now as Colorado cooperatives doing this to again we'll get into legally distribute patronage distributions distributions to our our Network and also known as dividends also known as dividends Layman speak um but yeah it's a really cool model and like I said I think AA trustless coinage is the first one we're now expanding with best Chev which is a show in the food space with some very famous Top Chef creators and you know no show can start from scratch and I think crypto in web 3 is very good at solving the cold start problem and coinage is living proof of that which went from literally zero subscribers and zero people watching to 2 million views off of our big first debut episode and the people who minted to watch that content now are being rewarded and they didn't even have to pay for it it was free um which we'll get into I guess later on yeah I mean dials are very much about Network effects it's about Community coordination and collaboration and so when you see the power of that Amplified the ability to coordinate around a particular like interest group or around kind of governance or even meta governance more broadly there's there's a lot of powerful things that can happen and things that are not necessarily you know Central Iz top down extractive that are um you know just kind of being built and extracted for the benefit of shareholders but it's really for the benefit of those contributors yeah we were talking about this I think there's huge Network effects that are lost when you look at something just as an investment right I mean there are plenty of ways to securitize things I think in the space it's very hot right now to talk about okay we're tokenizing this or tokenizing that and there have been attempts in the Creator space to basic basically sell Securities attached to athletes and their future incomes and things like that but what is not unlocked and what I think Dows and web 3 is really good at is the network effects of shared passions and so you know if you think about web 2 and the rise of influencers you're following them because you like the influencer but you also like the content so you have the network effects of a community even though it doesn't look that way you have essentially a community built around a shared passion in a Content Niche um so you know the way I describe what we're building is kind of like a mix of Kickstarter patreon and verifiable onchain Co ownership so our nfts are actually tickets into membership and co-owning the brand itself and we've seen our nfts rise in price which makes sense the larger our audience grows because if you think about media traditionally you've been selling ads it's a terrible model by the way the web two media model is grow an audience and monetize it by selling ads against that audience it's a worst product no one likes ads but when you start to monetize the network effects of of growing with your fans what we've actually just announced at coinage is we actually are now running our own validators so people can read the content learn about crypto and then if they want they can STI with us and those rewards go back to the dowo co-op which helps fuel our content so it's again the network effects of how you build these things it unlocks different monetization strategies and aligns interests in a way that lets a community come together around content that previously was not really possible in web 2 can you DC can you speak more more about the composition of your membership and like who actually interacts with the co-op um and whether there was kind of a hump that they had to overcome in terms of like all the web 3 parlament with not just with co-ops and DOW co-ops but with with nfts and tokens and how that's worked out for you yeah I think crypto and web 3 specifically right now is at a very interesting inflection point when it comes to what do we want to live on the front end and what do we want to be easy and it's a very interesting thing to watch as a bunch of investors normally are putting money onto chain so they very much want it front and forward but from a user perspective sometimes those complexities are very hard to onboard anyone we're at e Denver I don't need to tell anybody this but uh there are a lot of exciting account abstraction things happening now you know we started coinage we didn't need to worry about those because it's a community of people who love crypto and want to learn more and co-own again a media Outlet um and influence the guests we have on the show the content we put out and pitch anything that they really think we should be covering um but for few future media Brands it might not be that you have a large uh community of crypto native users so for besti ever our second show in the food space we're abstracting all of that away and what I think is really cool about cooperatives and Dows is that you know as a co-op it's not new everyone understands what REI is you go there you shop and you get a dividend at the end of the year if you're an active contributor and you know you can abstract away the crypto piece of that but the coolest bits of web 3 are aligned interests and the ability for people to contribute what they want to contribute and you know again enjoying the upside of where it goes and so for best is ever which is we're dropping basically in a couple weeks so you guys are all hearing about it first and thank you for being here by the way if you are here speak to me afterwards and we'll we'll let you con coinage at a heavy discount um but I mean the structure of it you have is mostly just like you use the bits that people actually want which is you know exclusives to to something with the Creator that they respect and enjoy and think will be you know bigger in the future and everyone thinks about speculation as a bad thing in crypto but I think it's it's really strong signal you might follow someone on Instagram but you want to grow with them you don't just want to be a passive simp uh you don't want to just subscribe but you want to grow with the Creator and I think web 3 is enabling a more intimate way to grow media online and co-own it which has never been possible before um so finally we're kind of monetizing the network effects around that and again aligning interest on the internet which there are so many I mean this is just one example but there are a lot of really exciting projects right now and it's fun to see people realize on the internet you can actually co-own things now you can and you can do it in a legally compliant way where you're not just uh you're not just considered a general partnership and you're liable for the acts of other members in your general partnership so if you are running a dow and it's unwrapped or doesn't have a legal entity that that backs it then you sort of default to this general partnership status and I think a lot of dows have been in the search for the right kind of entity choice and whether that's to wrap their whole doubt or portions of their doubt or to Silo out different operations and and things like that um the the co-op structure the LCA structure is just a really flexible framework um that works really well for these Dow structures so you can do you can have onchain governance you can submit proposals you can tokenize patronage units you can tokenize you know other things within your Dow whatever makes sense for you um and you have this beautiful Securities exemption that lives in the Colorado security statute for Dao membership interests and I think that that's something that more and more people are are finding out about and trying stretch but it's tied to your the inputs and outputs that you put into this this Co-op and this Dow so it's run very much like an investment club or any other thing where you're actually contributing contributing your efforts and so from a Securities Law perspective you have this sort of Shield um and and you don't need to register those Securities you're giving away our secret sauce yet which I enjoy and respect because it is kind of why I quit my job like I had I was it was a dream job my life goal was to be on TV and host a show and interview celebrities and I did I I got to do it and it was great but something clicked in the way that media has a bunch of problems and again web 3 finally enables Community uh co-ownership online and the value of content which is historically the worst part about media is there is no way to really monetize content outside of again selling ads but I wouldn't have quit the job and started this if it weren't for okay this is a compliant way to actually deliver on real co-ownership not just speculation of I want to Mint this nft or I want to buy this collectible and flip it but really build community that can build together and it's it's there are a bunch of silly examples like for me personally I saw a constitution Dow and it was people on the internet wanted to buy a con a copy of the Constitution they pulled $45 million in like a few hours and then went and tried to do it and it was like wow that is the power of what Dows can do but what could happen if you actually build over a shared Mission and so I don't know in media again you have a a very passionate reader or a very passionate viewer but there's no energy that you're tapping into other than okay you're a static viewer of our stuff but if you break down the wall between a content creator and Their audience and Build Together there are huge Network effects Network effects that are lost and left on the table and so I don't know to your point the wrapper of all of this it's a secret sauce because yes there's a Securities exemption and very much you need to build it properly but I think it's it's again enabling something that wouldn't be possible we at coinage have done some weird experiments I built my shitty New York City apartments in the metaverse and now our Dow Co-op co-owns that asset and we can flip that if we want we can sell it I don't know but like all of that's in a wrapper and it's extremely scalable so I think it's it's fascinating to hear the co-founder of Netflix again as one of our backers talk about you know you can't build a streaming platform from scratch but this is scalable in a way and our company trustless media is working with creators to again copy this model because it is really powerful not just do it for coinage but now in the food space you could do it in politics and sports bring together hosts let their fans co-own it and just drive the flywheel and do it legally absolutely so join coinage Co-op and uh stay tuned yeah there's yeah there's a lot of there's a lot of different things to come as I said best is ever is in the food space we have hosts from Top Chef who are going to be launching that um and there are a lot of other interesting you know decentralized media projects right now so I would shout them out as as well mad realities is kind of another project I saw and why I wanted to to build in the space because you know they were building on chain um and again it's just really cool now to see the mainstream ification of you know we partnered with Bas we built our nfts on base a trial pass so you can just mint and unlock the content and then slowly as people have touched coinage and realized what we're doing join to become Co-op members too so it's just you know a question comes to mind so again going back to your membership um as you scale as you grow as you have these Network that you tap into these like beautiful Ripple Network effects how do you maintain kind of the ethos of what you've started to build out in terms of like what you're building into your governance structure and this is going to sound extremely corny um I interviewed Pitbull one time Mr 305 Mr worldwide some of you may know him as Mr worldwide Mr worldwide Shout Out Mr where's the airhorn we need an air horn anyways pitol was like money can buy happiness you just got to give it away and it's a very corny line but pitol said it so was cooler than what I just said it but it's true and I think a Creator just wants to really have that that feeling with their fans like if you ask any kind of like I think Creator they're they're not doing it for oh I want to make a bunch of money they're like they want to create cre something and so I think all we are doing really trustless media as a company is is unlocking that piece um and letting them build with their their existing fan base and so you know media's evolved a bunch you know Netflix is not DVDs in the mail and now it's streaming but I think you know if you think about the evolution of media from web 2 and putting content online and the rise of influencers and Instagram and Tik Tok to now what web 3 does when you can actually have ownership and everything on chain and if you actually have a rapper and you have an entity that can have all the money go into an entity you can be sustainable and you can set up these alignments so coinage you know through the validator deal I I talked about earlier media companies are not supposed to be profitable after a year like that's not supposed to happen but when you apply the network effects coinage is now there basically so like again we we were talking about Colorado co-ops and being able to distribute dividends to members there's a bit of a race right now for the ones that exist and the ones that You' worked on to actually do it we've promised okay we set this legal structure up so we can distribute can I say dividends uh rewards distribu patronage distribution to our members and so like I'm excited because we're we're getting there I don't want to promise anything right now but it's like it's set up in a way that is actually functionally working and like I have the luxury of raising 3 million dollar before to where all right let's set this up coinage is separate and basically trust us has subsidized the creation of the first community-owned show and no one really knows that um but coinage has never even touched any of the money that's come in through our mints because it's just waiting to you know have the community and now we have more than 6,500 nft holders and the nft is up 200% and everything's functionally working and now we've done it in crypto news we're going to be doing in the food space and can be doing in any content Niche so right now I think it's exciting to just promise something deliver it and then see what happens when it's out there and how it gets better but to your question on like decentralizing it I think that that's a huge problem in our space I interviewed SPF I interviewed Doan if there are parallels in those it's that sometimes huis and like building something with unchecked power is maybe not a good thing um and weirdly the Dow model and the way that it's set up is like it checks Founders in a way that if you actually set it up properly and you have governance that's correct the members can check that and I think that's a super and balances important piece of of setting up Dow structure correctly so if if you were to give advice to other emerging Dow media startups or just Dow startups in terms of raising Capital how would you would you kind of comment on anything about structure potentially and like unique structures as they relate to the co-op model which has limitations on bringing in outside investors and returns and governance um and then also the final question is and we only have two minutes but if Netflix was to decentralize how would you how would you see that happening yeah killer Wales is another example of like what was trending on crypto Twitter for a little bit it was the attempt to decentralize a show and you'd buy a token I don't know exactly what their model was but coinage started very similar it just Min to token and unlock our content um but I think you know in terms of decentralizing these things that has been historically not great if you don't have an entity there's really no way to really start to raise in a legal way um but for trustless you know it's it's a startup that takes a position in these Brands as they start so trustless owns half of coinage the other half is legitimately to be owned by our Dow membership so mint an nft and own a piece of coinage um and then trustless can scale that way by making bets certain bets and increasingly it can become a platform so your question on Netflix it's very interesting to think about you can't start a streaming platform from scratch but if you start with certain bets in certain niches with creators who want to build with their fans you can slowly over time start to build up a platform that has all of this content living on it so that's kind of where trustless is focused but again everything in media you can boil it down you can do all kinds of crazy things but media is historically only as powerful as creators can be and unleashing them to the world in a way that they can monetize not have to worry about not getting paid or getting fired like journalism is on fire right now because they cannot monetize trust and it's very hard to monetize trust but crypto is built for that like web 3 is built for that and so it's it's I don't know I'm I'm obviously very passionate about this but if anyone wants to join anything that we're building you can speak to me after the show and I'll give you a discount on joining coinage or uh stay tuned for best Chev coming out in a couple weeks thanks so much Zach thanks for joining us thank you very much and everybody