Catching the NFT Bug With KnownOrigin’s Andy Gray
KnownOrigin is an artist-focused platform that lets digital creators authenticate, showcase and sell the artwork they create via non-fungible tokens (NFTs). Andy Gray, a co-founder at KnownOrigin, spent some time with host Paul Gordon for Coinscrum’s Meet the Founders series. Andy is a software engineer…
KnownOrigin is an artist-focused platform that lets digital creators authenticate, showcase and sell the artwork they create via non-fungible tokens (NFTs). Andy Gray, a co-founder at KnownOrigin, spent some time with host Paul Gordon for Coinscrum’s Meet the Founders series.
Andy is a software engineer by trade, where he worked for big business. A couple of software engineers got together, including himself, David Moore and James Morgan, and started talking about the blockchain. They all had an interest in it already and about three years ago started KnownOrigin. The team is still primarily two-thirds engineer and one-third product design.
When the crypto case hit, the people Andy was talking to in the City of London were all about doing swaps, which we now call DeFi. But Andy was drawn to the world of NFTs.
(3:02) “NFTs just made more sense to me. They were fun — you can see how they can be in game items. They just appealed to me more. And then the more and more I thought about what I wanted to do on the blockchain, I liked NFTs,” said Andy, adding that he liked the idea of collectibles, which is essentially what they are.
Art on the Blockchain
The KnownOrigin team is very proud to have gotten into the space early because, at the moment, the NFT market is going wild. They started talking about it back in February 2018. Dave ran pop-up galleries for art, and they realized it was a perfect use case for the blockchain that was not yet being developed.
(4:08) “We had a niche to develop something to actually prove we could do some stuff on the blockchain. And then it was just a bit of a good marriage really — a good use case. We wanted to put providence on the blockchain, which is what digital ledgers are good for. So we decided to just prototype the digital art marketplace and see if we could sell some art,” explained Andy.
They started with a physical gallery show comprising physical and digital works. They sold five or six pieces worth a couple of hundred dollars, and that’s when they caught the NFT bug and wanted to sell digital art.
The artists they spoke to who got it were very excited and understood why this could be an exciting thing if the market could pull it off. They started off small with a tiny contract and a tiny application. Since then, they’ve grown month after month and added more features. Now they’ve got about 1,000 artists on the platform and they sell digital art in the form of static art, movies, visual tracks and stuff that can be used in AR and VR galleries.
The UX is quite simple — you search for something, you know what you like, you find it and you buy it. The tricky part even after a couple of years is understanding that they are selling this artwork for ETH. You’ll be able to see the artwork in your wallet and there are gas fees, which are becoming more of an issue considering that KnownOrigin was built on Ethereum. Other projects like CryptoKitties have evolved to build their own dedicated blockchains for NFTs. Their UX is super slick and could be a glimpse of the future, Andy said.
(7:42) “But for us having a public blockchain behind it and being able to interact with a web page and use ether is still quite important to us in terms of tracing the providence,” he noted, adding that they are still keen to leverage the fault-tolerant nature of blockchains because that’s why they got into it in the first place.
KnownOrigin sells art at all price ranges. They have auctions on-chain, which sometimes places them in predicaments where someone wants to accept a bid for $60 but the gas cost is $30. It doesn’t make sense for anybody. So in a sense, Ethereum is becoming unusable.
Some NFT platforms have moved to Layer2 solutions, and some have gone off-chain. Off-chain signing has become popular. KnownOrigin is optimizing its contracts and now knows a lot more about what needs to be on-chain and what can be done off-chain. This is making it a lot cheaper to work on Layer 1 Ethereum right now, but there’s no doubt they might have to go to Layer 2.
(10:47) “But really what we’re hoping for is that some of these projects that are leading the way, especially like Matic…and these guys that are Ethereum compatible, when they start bringing the users with them, then I think we will be moving as well. We’ve got an eye on that,” said Andy.
The KnownOrigin team has always had open communication with other marketplaces. They are working with other platforms that do NFTs on a royalty standard on Ethereum so when an artist’s artwork is sold on the secondary market, the royalties get sent back to them.
The problem with these “walled gardens,” Andy said, is that if one project implements the feature but another secondary marketplace doesn’t, the artist doesn’t get their commissions. So KnownOrigin is looking to use standards so people can know if they are buying on a certain platform if certain implementations are being followed.
(13:24) “So it’s in everyone’s interest, and I think the scene is still young for these ERC-1155 tokens that are now rarable NFT,” said Andy.
A few short years ago, KnownOrigin was getting a couple of artists that were really engaged and early adopters of the technology. They were able to work very closely with these artists, almost on a one-on-one basis. Now they get about 1,000 artists per month, so it’s more difficult.
They are seeing more traditional artists and illustrators, as well as people who make digital art and have nowhere else to go. They are able to sell and some are even able to quit their jobs and become professional crypto digital artists. Many of the NFTs on the platform have appreciated, and the early adopters have profited. People can see the stats considering it’s a public blockchain. It’s very easy to know your ROI.
Netflix of the Art World
KnownOrigin originally thought the traditional art world including dealers and auction houses would be keen to work with them, but that hasn’t been the case. But with some NFTs selling for millions of dollars, some are starting to show an interest, including from Christie’s. Galleries take 50% of the ticket price, but KnownOrigin only takes 15%. They also give 12.5% on all secondary sales back to the artist.
KnownOrigin doesn’t need to have a token for them, but they would like one for governance. As a curated marketplace, they don’t want to have the final say on which art comes onto the platform. So when they do a token, which they probably will, it will be a governance token. They want to be community-driven.
KnownOrigin is growing the team to free up the founding members a bit from things like social media and provide the proper support to the community.
(26:46) “We want to make sure KnownOrigin is a creative place for people to come and do things on. So we’re just making sure all the toolings there so the artist can just do the thing really,” said Andy.
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