Without the intent of sounding like a broken record, it’s little to no secret that public blockchains accrue their value from network effects.
The best way to look at it is to imagine a moat around a fortress. The moat acts as a vestibule to a deep and empty valley allowing nothing to enter the fortress that could prove hostile to its inhabitants. The fortress on the other hand, represents the collective might and power of the nation and its inhabitants occupying it.
In relation to Tezos, we can view the moat as the underlying secure smart contracts and likewise the fortress can resemble the various entities that are using Tezos either directly or indirectly. For the sake of this post, Ubisoft will be using Tezos directly, and we’ll explain how they are doing just that.
Earlier this week, TQ Tezos put out a short post
describing the Ubisoft news to a certain degree. What was once considered an improbability has been rapidly catching steam with more and more corporate bakers coming to the Tezos ecosystem.
This concept goes beyond the trivial and often conflated “partnership” news we see within other projects using X blockchain for some reason or another. Corporate baking is much more direct in this sense. These are enterprises that take their own capital, market buy tez (if they don’t hold it already as indicative in a balance sheet) and set up a baking operation on the Tezos network (which isn’t exactly cheap, btw!).
In short, these select enterprises are doing a couple of things.
- Assuming all upfront costs through acquiring tez on the market.
- Taking a fiduciary risk by running the baking operation.
- Expressing enough interest in Tezos to the point they’re contributing to the network in the most direct way humanly possible (securing + producing and validating blocks on the network).
- Gaining experience with the network (which can translate to other things).
The latter two points are the most exciting parts and contrary to some beliefs, go beyond simple speculation.
Awhile back, I had the chance to chat with Alain Broustail of Sword Blockchain/ Sword France. In some of his responses
, he outlined from an enterprise standpoint the decision basis behind choosing to run a baker on Tezos.
As a senior consultant, I am often advising board members of our clients about the legal status of crypto assets and the best processes for managing corporate wallets. Terms like GDPR, IFRS, 4 eyes validation or ISO27001 popping out. Similar questions have been asked by Sword CFO when we proposed the project. It’s good to give the answers to the questions. But it’s even better to show that you have been through it yourselves.
If you had to choose between two consulting agencies on the topic, would you rather believe the one who thought about it, or the one who thought about it and then implement the solution for itself?
There are still very few “corporate” organizations the size of Sword France (>50M€ revenues) who did cross the line, but many will and we are here to help!
Also, I want to point out that this project attracted a lot of interests from our collaborators internally. Many had no, or poor, knowledge on what blockchain technology is.
Even recently graduated engineers coming from some of the best schools in Europe were still believing that “mining” a blockchain was only about wasting massive amounts of CPU/GPU and electricity as fast as you could. These people now have a different vision, and are in a way better position to spread awareness on blockchain in general and Tezos specifically to our hundreds of clients.
It’s all about first hand experience. Getting enterprises accustomed to the Tezos network through direct firsthand experience (baking) can open up further opportunities/applications at a later date. It is indeed, in my opinion, the most profound method of onboarding.
With that in mind, let’s look at Ubisoft’s press release
in coordination with Nomadic Labs.
We’re happy to be joining the Tezos ecosystem as a corporate baker. Ubisoft believes that blockchain has the potential to bring new possibilities to players and developers alike, and this new collaboration will allow us to pursue our innovation efforts with an ecosystem that aligns with our environmental-friendly approach thanks to its proof-of-stake consensus algorithm.” - Nicolas Pouard, BID at Ubisoft
Beyond just strictly baking, the door is wide open for further collaboration/exploration if it wasn’t made explicit enough in Mr. Pouard’s comments. What will result from this announcement remains yet to manifest itself.
However, with all the gaming/creator applications currently underway through InterPop and others, it doesn’t take a ton of thought to consider what might eventually unfold.