The Trojans’ venture Moonlight aims to make it easier
Blake Asherian realizes that most people don’t have a spare $60,000 just lying around – which is about what you need to buy an NFT (non-fungible token) of any real value. He also understands that on a broader level, most people don’t even know what an NFT is or how to buy one.
That’s why Asherian and three other Trojans – Gabriel Perez, Matthew Hausman and Can Toraman – have started Moonlight, a fractional NFT marketplace that allows users to buy, own and sell parts of an NFT in a simple and user-friendly way.
Moonlight – founded by Blake Asherian, Matthew Hausman, Can Toraman and Gabriel Perez (clockwise from top left) – allows users to buy, own and sell fractions of an NFT in a simple and user-friendly way. (Photos/Courtesy of Blake Asherian, Matthew Hausman, Can Toraman and Gabriel Perez)
Despite gaining significant traction over the past year, NFTs are still in their infancy and there are financial risks involved given their uncertainty and high price tags. Moonlight hopes to remedy that, or at least help bridge the gap between most people and this new space.
“If the average personal income is 63,000, and the average cost of a blue-chip NFT is 51,000, that’s a big problem,” said Asherian, a business administration undergraduate at the USC Marshall School of Business.
“Part of the reason people are not as inclined to go into NFTs is because there is such a high barrier in terms of knowledge and technology,” Asherian added. “We’re breaking down that barrier.”
How to buy NFTs: ‘Non-fungible tokens’ explained
The concept of Moonlight is simple: A group of people will choose an NFT they want to crowdfund, and when the funding goal is reached, each crowdfunder becomes a co-owner. From there, co-owners can buy and sell their fractions on Moonlight’s platform.
While the platform may be simple – or at least the goal is to make it as simple as possible for people – the concept of an NFT is not widely understood and can seem a little intimidating.
Essentially, an NFT is a unique piece of digital art that is certified using blockchain, an immutable ownership. The non-fungible part means that no two items are the same or the same. NFTs work similar to how people collect and sell art or trading cards. Some items are worth almost nothing, while others fetch millions of dollars.
Moonlight’s goal is for people to have the opportunity to own fractional NFTs of real value, which is why the company focuses on “blue chip” – or most valuable – NFTs, such as Bored Ape or CryptoPunks, which have potential to provide long-term returns and can easily go for six figures.
But why would a digital image of a monkey or a pixelated person be worth hundreds of thousands of dollars?
Well, why would anyone pay over $7 million for a baseball card? Or thousands for some of the “contemporary art” listed at Sotheby’s?
All are fair questions, and the answers may vary depending on the person or item. The common factor is that collectors feel that these are assets that will increase in value. NFTs are just the latest version.
I always want to argue with people: What is the difference between your trading card and an NFT? They took a picture of a guy and then put it on a piece of paper and somehow it has value.
Matthew HausmanMoonlight co-founder
“I always want to argue with people: What’s the difference between your trading card and an NFT?” said Hausman, Moonlight frontend architect and 2021 USC Viterbi School of Engineering graduate.
“They took a picture of a guy and then put it on a piece of paper and it somehow has value.”
Crowdfunding, fractionalization and reaching the 99%
To those who only read certain media accounts, it may appear that NFTs and the cryptocurrency used to purchase them are a losing bet, and they may be to some. However, Moonlight’s creators were quick to point out that there are a lot of financial risks out there, and the platform’s crowdfunding feature could help eliminate some of those potential dangers.
With Moonlight, crowdfunding is key. Users choose an NFT and then have a certain number of days to collect the money. If the money is collected in time, the NFT is moved to the Moonlight platform where people can buy and sell shares. If the funds are not collected in time, then everyone who has contributed gets the money back.
“No other protocol allows you to literally pool money to buy cool stuff together,” Asherian said. “The secret sauce here is to have a technology that can allow any number of people to put their money into something and as a group get anything they want.”
The next concept, fractionalization, isn’t necessarily new, but how Moonlight allows users to fractionalize is a direct response to a major problem in the NFT community. Right now, someone who owns an NFT can fractionalize it and sell those fractions at whatever price they see fit, regardless of the actual market value. People who are knowledgeable about and can afford a six-figure blue-chip NFT have no need for fractionation. So the practice can benefit from those new to the space — a problem that Moonlight wants to correct.
“For a bunch of people who are just getting into NFTs, how can they trust that this valuation is true?” Asherian said. “They don’t know enough about the protocols or the NFT collections. They’re kind of swayed in a false direction, and it’s unfair to them.”
Asherian and his team at Moonlight emphasize that their platform is truly for everyone. NFTs – and even the cryptocurrency used to buy them – can seem intimidating to those not already in that world, but their hope is to take away some of the hesitation.
“At the end of the day, if you look at who’s interested in NFTs, it’s the 1%, right?” Asherian said. “We want to leverage the 99%, so we need to create a product that is comprehensive for that group, which not too long ago included myself.”
From crypto to NFT
The initial concept for Moonlight came to Asherian in late 2021, but his interest in NFT started about two years ago when he worked for his cousin, Sean Rad, the founder and former CEO of the dating app Tinder. Rad—once a USC student—had invested in Genies, an avatar technology company, and Genies co-founder Akash Nigam began talking to Asherian about the company’s venture into NFTs. Although Asherian knew nothing about NFTs or blockchain, the concepts piqued his interest.
Soon after, he left his jobs to buy and sell NFTs full time. He admits there were some definite growing pains early on due to the high barrier to entry, but those missteps put him in a position to succeed down the road.
He began working on the concept for Moonlight while studying abroad in Paris last year. He connected with other Trojans abroad, which led to even more connections when he returned stateside. Asherian credits USC with introducing him to Perez, Hausman and Toraman, and making Moonlight what it is today.
Ever since I was a freshman, I always heard that term “Trojan family”, but then I was really able to witness what it can do.
Blake AsherianMoonlight co-founder
“I truly believe in the Trojan family and what it offers,” Asherian said. “Ever since I was a freshman, I’ve always heard that term ‘Trojan family,’ but then I was really able to witness what it can do.”
A transfer student from the University of Wisconsin-Madison, Perez said his interest in NFTs has been a gradual progression since he was in high school. He started by selling stocks with his friends, and then in college he found a new interest in cryptocurrency.
“I kind of fell in love with the philosophy behind Bitcoin, which is a very anti-centralization of money, anti-central banks, power-back-to-the-people kind of thing,” said Perez, a junior economics major in the USC Dornsife College of Letters, Arts and Sciences.
“Then I learned about Ethereum, which was the first time I realized that this has great potential to be the currency of the internet in the future.”
Ultimately, Perez, product and community manager at Moonlight, felt that if he wanted to further his career in the crypto world, he needed to move somewhere he felt was more popular and appreciated. He found just such an innovative environment at USC, where USC Viterbi even offers a blockchain minor.
He came to USC before the fall 2021 semester and joined Blockchain@USC—a student-run organization that engages in blockchain-related topics, develops blockchain applications, and connects with industry professionals—as director of external relations.
We started talking about fractionalization of NFTs and the opportunity for smaller capital players to be able to dive into these pools and I was hooked from there.
Gabriel PerezMoonlight co-founder
At USC, both within his major and social groups, Perez surrounded himself with like-minded people who shared his passion, which is when he first heard about NFTs and eventually met Asherian.
“We started talking about fractionalization of NFTs and the possibility of smaller capital players being able to dive into these pools, and I was hooked from there,” Perez said.
By the end of the spring 2022 semester, Perez and Asherian had formed the Moonlight team that was formed and began work on launching their idea.
How to buy NFTs: confidence, sustainability and the way forward
The Moonlight crew is aware of some of the sustainability concerns with NFTs, primarily the proof-of-work blockchain system used by most cryptocurrencies, allowing transactions to be processed peer-to-peer securely without the need for a third. party. Proof of work uses a significant amount of energy. Rooms full of computers are needed to run complex mathematical equations, and coolers are needed to ensure those computers don’t overheat. By one estimate, mining 1 Bitcoin uses as much electricity as a standard American home would use in nine years.
Most NFTs are part of the Ethereum blockchain, which currently uses proof-of-work. Next month, however, the Ethereum “Merge” will shift the blockchain to proof-of-stake, which uses 99.95% less energy by reducing the amount of computational work needed to verify the blocks and transactions that keep the blockchain secure.
“Fingers are crossed that the ‘Merge’ goes well because it is a much-anticipated catalyst in the crypto world,” Perez said. “If it goes right, NFTs probably won’t have much of an environmental footprint at all, compared to something like a few downtown office buildings.”
But before they get to the point of using more sustainable blockchain, Asherian said they need to establish their footing. Moonlight is slated to go live later this fall, and Asherian said once they develop their community and build trust, they can influence people to move toward more sustainable practices.
“When you’re a big marketplace that everybody starts to suspect has authority in the NFT space, you kind of tell them what to do next,” Asherian said. “We really want to be able to get that authority, and the way to do that is by being transparent, simple and fun.”
Trust and NFTs – or crypto, for that matter – may not yet go hand in hand for much of the general population, but that’s exactly what Moonlight hopes to fix. They see NFTs as an opportunity, not just for those who are “in the know”, but for everyone.
“We believe there is strength in numbers,” Asherian said. “At the end of the day, we want to empower the people so they can own what they want, together.”
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