Blockchain Center CEO shares 3 core tips for those looking to start a crypto business
In an exclusive interview with Finbold, Blockchain Center CEO Gintautas Necrosius shared some insights for entrepreneurs to leverage as they establish themselves blockchain-related businesses. He highlighted factors such as the importance of engaging industry experts and how you structure your team, as well as the crucial aspect of funding.
Furthermore, the practitioner immersed himself in the general the cryptocurrency market outlook shares its opinion on Bitcoins (BTC) perceived status as a hedge against inflation. Nekrosius also spoke about the future state of the blockchain and the potential impact on the sector from the incumbent bear market.
The Blockchain Center has a wide range of services for those who want to try their hand at the blockchain, Non-Fungible Tokens (NFTs), crypto space. Can you briefly explain what Blockchain Center is and how it feels to be part of a blockchain gaming giant’s Animoca Brands ecosystem?
“Blockchain Center is a one-stop shop to take your Web 3.0 concept from idea to finished product with as few errors as possible. Our mission is to help developers build and accelerate blockchain adoption.
We have a strong in-house team that can create sustainable tokenomics, provide eye-catching graphics, devise fundraising strategies and help with development or marketing. Having everything managed in one place is obviously both rare and a significant time saver – you don’t have to worry about miscommunication or keep looking for constant roadblocks between different companies.
Blockchain Center is part of Animoca Brands, the #1 investor in GameFi, with a wide variety of successful projects under its umbrella, allowing us access to the best resources, experts and first-hand experience in the market. We can talk to different project managers, see the problems they face, the solutions they implement, and use this knowledge to guarantee that no mistake is made twice.”
2022 was not “friendly” to the financial markets, including cryptocurrencies. How did it affect your business? How has interest in starting a blockchain-related business changed this year so far?
“While the price of Bitcoin may have fallen from its all-time high, we are at a new all-time high – the amount of development, funding and talent in the space. It has never been higher. Just in the first 6 months of 2022 companies closed more than $3 billion in financing There were about 135 financing deals closed in 2021. And in 2022 this number is already at 228, even without taking into account figures for the fourth quarter.
And it’s not just the VC numbers that show growth – if we look at blockchain games, we went from 600 thousand unique daily wallets in May 2021 to 1 million unique daily wallets in September 2022. So while the total trade volume and sums are lower , increases the amount of traders or users. People are just more cautious and less speculative. I look at it this way – people stopped playing and started investing.
In order to adapt, we have started to focus on a more secure price structure. We started trading with fixed prices and stablecoins alongside project native tokens. Before, we only aimed to build a diverse treasury of different tokens and focus on taking projects to market, nurturing them from the ground up. Now we have the treasury, and to supplement it we started offering one-off services to established projects already in the development phase that want to become market leaders in their sector.”
How hard is it to start a business on the blockchain? Can you list the three most important things to focus on when starting a crypto company based on your own experience?
“It’s easy to start a business on Blockchain – it’s much harder to start it the right way. I’ve seen countless projects ‘set back’ because they didn’t know anything and it was impossible to go back and fix it.”
From my personal experience, here are the top three things you need to know so you don’t have to reset.
- Get an expert opinion on tokenomics early. You will not be able to change or adjust this according to the mint. And the symbols aren’t just numbers on a pie chart – release too many, to the wrong people, or too few, and your project will suffer for years to come.
- Don’t raise more money than you need. The extra money you raise will be unnecessary extra sales pressure later. If there are more tokens available than users – you will quickly lose a lot of value. So, manage the treasury properly; you don’t have to sell everything on IDO, private or private. Keep your value locked up in a treasury and sell as demand grows rather than making everything available at once.
- A small skilled team is better than a large incompetent one. Make sure you hire people who know what they are doing; if the junior positions exceed the senior positions – you are in trouble.”
You bring new customers who want to launch their crypto businesses. Which of these multiple sectors are customers venturing into the most: Metaverse, NFTs, blockchain games, or cryptocurrency (token launch)?
“As part of the Animoca Brands ecosystem, we naturally gravitate towards GameFi projects. And every GameFi project usually needs a token launch and multiple NFT collections – so we tend to focus on those.
For Metaverse-based projects, the barrier to entry is obviously incredibly high, and the amount of funding, talent, and expertise these projects need is out of proportion compared to the other ventures. So not many individuals have the right team to start these projects and seek funding.
At the same time, interest in blockchain games has waned a bit, but it is still a sought-after industry. Because game companies don’t have to compete so much with each other. Each game can have its audience and be unique, while a specific cryptocurrency definitely competes with something already on the market.
This year, various GameFi projects raised anywhere from 100 thousand to 200 million from VC funds. However, CeFi projects still tend to attract the biggest investors – raising as much as $1.15 billion in the case of Citadel Securities.
As crypto winter reigns, are you worried about the future of blockchain? What does the future look like for the blockchain sector in the next few years?
“While the perceived value of cryptocurrencies bounces up and down every year – the overall pace of users, developers, projects and funding in the blockchain space is growing.
- We have a 34% increase in active users for the blockchain gaming sector when comparing 2021 and 2022;
- There is a 32% increase in the amount of financing deals Web 3.0 companies close when comparing 2021 and 2022;
- There is only a 34% decline in DeFi users. Even after major platform collapses like Celsius or Anchor, daily active users have dropped from around 50,000 to just under 30,000;
- The term “external crypto jobs” was searched 614% more times in June 2022 than it was in the same period in 2021 – enabling more people to work from home or just get a job overall.
In 2018, crypto was mainly just Bitcoin, Ethereum (ETH) and speculation on crypto exchanges. Today we have several alt-chains with their own ecosystems, games and art projects. While some of the largest projects are reducing the number of positions they have open, many projects are still hiring and trying to build out their vision.
Therefore, I am not worried about the future of Blockchain; it’s just a technology after all, it’s successful if it helps solve problems, and we can measure that by usage, not price.”
What about cryptocurrencies – do you think they solve any real problems? In your opinion – is Bitcoin still ‘a hedge against inflation’?
“I think it’s a great digital currency that’s almost impossible to counterfeit; the fact that there is built-in anonymity and privacy definitely helps it stand out from your regular digital bank transfers.
The network can operate without human supervision; it doesn’t take vacations, you don’t pay monthly service fees to own a wallet, and probably the biggest advantage of cryptocurrency is the fact that it can operate in the regulatory “grey” area. It will not be frozen or seized, and protects users from abuse of power by their government officials or bullying by banks.
And when I describe Bitcoin as a hedge against inflation, I don’t think we should be looking at the strongest currencies in the world; buying Bitcoin is no different than buying US Dollars or Euros when your native currency is in trouble. Their adoption is larger than a single country, so naturally it is more “shock absorbing” in times of local crisis. But during a global crisis it will follow the same patterns as other top currencies because it is just that – a currency, not a superpower.”
Do you think that the excitement around the idea of using NFTs as digital art has died down and that the market is now readjusting? Also, do you think that other use cases for NFTs, such as in real estate and the fight against counterfeiting of real-world goods, will eventually become the norm?
“Using NFTs as digital art is definitely not as exciting to people anymore. In my opinion, NFTs are a great way to digitize ownership, but as art, they’re just not fun. Now people want to do more with their NFTs since there aren’t many places to show your NFT art and even fewer places where people care enough to look at it.
While there are good uses for NFTs, property or counterfeit protection is not one of them. A lot of changes would have to be made for NFTs to become the norm in real estate, and I don’t think it will be a huge improvement on what we have now. And the only thing that realistically stops NFT counterfeiting is the blue mark on OpenSea. So using a highly counterfeited item to combat counterfeiting is probably not the best idea.
However, I believe NFTs have a wonderful and meaningful implementation in the gaming sector. Game items are already digital, and they are already being traded. So NFTs will only enhance the experience by allowing cross-game items to exist and cut out shady third-party resellers by allowing players to take control of the items they own.”
As we approach 2023, are there any services or products that Blockchain Center plans to add to the platform over the next year that you can share with us?
“We will adapt to what the customers need because here at the Blockchain Centre; we do not focus on providing a list of services. We are an ecosystem that uses its resources to provide everything a project needs.
Most of the projects we work on build something that has never been built before. In many cases, it is not possible to prepare services to meet their needs in advance. However, we try to use our network of connections to find and manage industry leaders who can help accelerate the construction process or lighten the load on time-consuming tasks.
Our most important asset is the almost limitless network of connections, from VCs and experts to synergistic projects and developers. Being part of Animoca Brands gives us seats at the table where the most important people in the industry sit. Since our mission is to accelerate blockchain adoption, we act as a bridge – connecting all the individual pieces and ensuring that projects work together to achieve their goals faster.
We are also starting some internal projects to further develop our experience and knowledge, but we are not sharing them yet, as our main focus is still on our customers.”
-The end-
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