Azuki founder Zagabond on his NFT past, PBT and web3’s future

“In crypto, there’s a concept I like to call ‘culture layers,'” Zagabond told Highsnobiety, giving the example of Supreme: it’s not the label’s hyped drops that drive streetwear, but its adherence to skate culture. “The NFT space has become so much about turning that the cultural aspects of NFTs still have a long way to go, but I think that’s changing because there are real innovators here playing with technology.”

Whether NFTs follow streetwear, skate culture or the incentive to “flip”, Azuki’s founder Zagabond (or Z, as he often calls it) is betting on a combination of all three.

On October 21, Azuki will release a series of nine golden skateboards, complete with a 24k gold-plated deck, at Hong Kong’s K11 Musea Mall. The golden skateboards will be linked to a physically backed token (PBT): a cryptographic chip that can be scanned to prove ownership of the physical item created by Chiru Lab, the parent company of Azuki, founded by Z in 2021.

“We like to plant at the intersection between digital and physical. With PBT, we want to create an open standard that people can create implementations and experiences on top of,” said Z. He considers PBT a milestone that opens new doors for what Azuki has been building for the past year and a half. It is also a culmination of what Z hopes is a positive impact on web3.

The man known as Zagabond started his career at Google and Amazon as a digital marketing strategist, learning about the “monolithic” scale of the industry during his two and a half years of experience in the corporate world.

This encouraged him to embrace the decentralized nature of crypto when he became part of the founding team of 0x, a peer-to-peer trading platform for ERC-20 tokens.

After four years at 0x, NFT projects like NBA TopShot and Bored Ape Yacht Club piqued Z’s interest. For him, one of web3’s core appeals was the opportunities it created for people to take ownership of the projects they are engaged in, particularly “at the intersection of digital identity, collectibles and branding.”

“Web3 really brought this new culture of digital identity, digital community. I wanted to build a brand that resonated with the generation of people born in web3, similar to how ‘internet culture’ is now just culture. I assembled the team to map out this vision of building an anime universe that is both digital and physical.”

And so the Azuki universe was born. As an NFT collection, Z believes there is an opportunity to “create emotional attachments to the brand, the characters and the story”. After interviewing about 20 different artists, the team ended up bringing in Steamboy, a former character artist for Overwatch.

Azuki became a smash hit after its launch in January 2022, quickly becoming one of web3’s fastest growing NFT projects. However, that quick success was met with similarly abrupt backlash, as people on Twitter accused Z of “blanketing” Tendies, CryptoZunks, and CryptoPhunks, three other NFT projects he helped shape.

Twitter scouts went into detail, accusing Z of laundering – buying and selling its own securities to pump volume – and netting over $3 million across the three projects. Z, meanwhile, simply describes his previous projects as “mistakes.”

It’s not uncommon for tech companies to raise and lose millions, but NFT projects are often put under more scrutiny by buyers who expect utility or IP in return.

“The Web2 mantra is ‘move fast, break things,'” Z said when asked about web3 responsibilities. “With web3, I learned that the community is everything. Empathy with them is a necessary skill if you want to build something meaningful. That’s the core value ours at Azuki, that community comes first. That’s the main reason we have a vibrant and loyal following.”

According to the numbers, Azuki’s is generating headline-worthy sales. In September 2022, eight months after Azuki launched, collectors were willing to pay upwards of 105 and 106 ETH ($135,000-$142,700 at the time) to join the community.

This success inspired rumors that Chiru Labs was seeking Series A funding worth $30 million, although Azuki’s team refuted the whispers (for now).

Nevertheless, Chiru Labs still has high hopes of making Azuki the “gold standard” for future physical NFT activations. But by making its PBT technology open source, Chiru Labs isn’t pinning its hopes solely on Azuki: the goal is to level the playing field and invite everyone to the pitch.

“It’s smart contract developers creating new financial protocols that are changing the global financial structure,” said Z. “If you look at fashion and streetwear, you see the shift.”