Calaxy CTO: creator tokens are backed one-to-one by stablecoins on Hedera

Ashton Addison: What is Calaxy, and what has the team been building?▶ 00:20

Cooper Kunz: We think of ourselves as an open social marketplace. Content creators, professional athletes and celebrities of all kinds can offer more direct, intimate experiences to their fans through a variety of tools and services. It gives them a single stop where fans and the wider community can engage with them. You see that in familiar social features like post feeds and stories, but you can also offer direct video calls or video messages to your fans on Calaxy.

Ashton: Many platforms see this problem. Why will Calaxy's approach succeed?▶ 01:54

Cooper: Calaxy sits between what we think of as Web2 and Web3. Web2 is traditional social media like Twitter or Instagram, plus monetization tools like Cameo and Patreon. But there isn't yet a Web2 platform that makes it seamless to not only talk to your fans but also earn money from them. Calaxy feels like Twitter or Instagram, but we use Web3 tools to provide more intimate experiences. Specifically, it's a platform for social tokens, which are fungible cryptocurrencies branded for different celebrities. Spencer Dinwiddie, who plays for the Washington Wizards, is our co-founder and CEO. If you wanted a video call with Spencer, you would buy his token and spend it on his time. It also means you have a balance on a public blockchain that tells you who your biggest supporters are, and you can verify it. We also enable NFTs. We ran a pilot with a partner where you could buy one of Spencer's NFTs and redeem it for a pair of shoes he wore in an NBA game. And we're working on interoperability protocols for decentralized social media. If someone builds a better version of what we're doing, they should be able to plug into the posts, feeds and followers that are already there. That removes a lot of the vendor lock-in you see in Web2.

Ashton: Can anyone create a creator token, and does its value fluctuate?▶ 06:05

Cooper: Right now, creator tokens are backed one-to-one with stablecoins. If you just want to buy a video call or some merchandise, you shouldn't have to worry about price fluctuation. The community may decide it wants dynamically priced tokens, and we could explore that in the future, but for now we want to keep it as simple as possible. We're working with a number of stablecoin issuers and would support any popular stablecoin. The tokens are collateralized on chain on the Hedera Hashgraph network. Stablecoins can be deposited and creator tokens are minted or burned on demand, so you can unwrap your tokens back into stablecoins whenever you like. Fans are never stuck in a token of a celebrity who's no longer offering services or responding to requests. The ecosystem is also permissionless. If Calaxy hasn't verified you yet, you can still create a creator token directly on Hedera. It could be compatible within Calaxy or the rest of the ecosystem that supports these social tokens.

Ashton: Why is Hedera the best technology for this kind of platform?▶ 09:37

Cooper: The first thing is governance. Hedera is owned and operated by some of the largest companies in the world, including Google, Deutsche Telekom and IBM, which contribute to the network infrastructure. Knowing those enterprises are investing their own resources is validating for the resources we invest as well. It's also very fast. We can do tens of thousands of transactions per second, which matters when you're dealing with celebrities who have millions of followers and want to build familiar Web2-style experiences. And Hedera stabilizes its fees in US dollars, so every NFT minted on Calaxy costs only a dollar. On Ethereum I recently paid gas fees of about $130 to mint an NFT, so doing it at scale just isn't an option there. Predictable fees mean we can forecast our costs months or even years in advance. We also do gasless transactions at the moment. Calaxy counter-signs your transaction and pays that dollar fee for you, so technically it's free to mint NFTs on Calaxy.

Ashton: How does the Calaxy token fit into the ecosystem, and how does it keep things sustainable?▶ 12:15

Cooper: The Calaxy token is a separate cryptocurrency from the creator social tokens and NFTs. It isn't just relevant to Calaxy Inc or our application. It's a broad protocol and ecosystem governance token. Any application can integrate the social tokens and NFTs we discussed. Whenever they transfer those tokens or buy an NFT on a secondary marketplace, they have to attach gas or protocol fees in the native Calaxy token. That powers the ecosystem and puts a cost on different types of attacks or spam. It also provides formal on-chain governance. Fees and standards, such as accepting a new type of stablecoin as collateral, would have to be voted in by the community of token holders. They will also determine which third-party applications can verify people, much like governance tokens such as Uniswap's.

Ashton: Where is the team now, and what milestones are coming in the next few months?▶ 14:12

Cooper: Over the past couple of months we've built out our initial team. We have a solid internal engineering team, and I just hired an ex-colleague, Paul Madsen, as our head of identity to work on decentralized identity. We also completed a seed round of fundraising and grants, raising a little over $7.5 million, and we're using those funds to build out the rest of the team. We've been live in a private beta with about 100 users. Through the rest of the year you should see us go live with a public beta, announce some partnership integrations, and run exclusive NFT drops and campaigns, including with creators we haven't yet revealed. The theme for the rest of the year is validating and testing our model, and then hopefully we can make a lot of noise in the new year.