Sam Englebardt and Richard Kim are general partners at Galaxy Interactive. We cover the digital art market, the social impact of Web3, and elements that create successful game communities.
Principles & Lessons:
1) True community is rooted in shared values, not just shared tokens. Richard describes an experiment called RNG, where a token-centric community formed quickly but proved fragile. As he put it, “You do not build the community around the currency, you build the currency around connecting communities.” He noted that money is a way to do business with those you don’t fully trust, whereas genuine communities thrive on common interests and creative participation.
2) Generative art gains power by merging creativity with meaningful constraints. Richard cites Philip Galanter’s definition: “Generative art is any art practice where the artist uses a system…set into motion with some degree of autonomy that results in a completed work of art.” Projects like Art Blocks blend algorithmic rules with randomness, enabling unique pieces the artist themselves never fully predicted. This controlled unpredictability sparks both collectors’ excitement and enduring artistic value.
3) “Come for the markets, stay for the art” describes how speculative entry often leads to real creative passion. Sam admits he was initially skeptical of NFT art, but saw Richard become a dedicated student of generative art after first discovering it through speculation. Sam says, “You come for the market, and so many of these people stay for the art.” This phenomenon significantly broadens who collects and supports new art forms.
4) Scarcity alone does not guarantee long-term NFT or art value. Patrick asks whether any “beta” in NFT art outperforms simpler alternatives over time. Sam stresses that lasting worth depends on more than “just the output itself” – the community around it, the artist’s significance, and the piece’s place in art history matter. As Sam notes, “We can all now probably say Beeple is cemented by virtue of being one of the first… but we’ll only know how big that paragraph is in the history books over time.”
5) Top-down storytelling can complement user-generated content. Sam highlights how a fully open “create whatever you want” approach often undermines clarity and quality. He observes, “We talk about VR letting you look everywhere, but the dilution of story is huge if you don’t guide the user.” Richard echoes this, recalling that “the best user mods come from robust top-down worlds like StarCraft.” Games merging well-crafted narrative with community contributions often produce richer, more sustainable ecosystems.
6) Injecting markets into every virtual interaction can erode fun and immersion. Richard cites Diablo III’s auction house as a cautionary tale, where focusing on “extrinsic motivations of wanting to earn a buck” overshadowed the game’s core experience. He contends that bridging open market features into closed-loop worlds risks pulling players out of the escapist mindset they seek.
7) Play-to-earn models must solve the demand side, not just supply. Many NFT-based games focus on letting players “sell items” or “earn tokens,” but overlook who buys those assets and why. Richard calls this “the first question: why would someone buy this?” If a token economy lacks genuine demand or compelling gameplay, speculation alone cannot support the system.
8) The pace and pressure of 24/7 markets can challenge mental health and balanced living. Sam notes that staying engaged in Discord or NFT trading can be “viscerally unpleasant,” crowding out calm and reflection. While new market opportunities empower creators and participants, Sam warns that “there is a psychic cost to it,” emphasizing the need to consider life quality and well-being when immersing oneself in always-on digital worlds.
Transcript