A Theory of Value

Hi, I’m Severin Matusek and I’m the founder of co—matter, an agency for research, strategy and collaboration. I'm writing this newsletter to capture my personal thoughts on the evolution of culture, technologies and communities.
When I was thirteen I collected basketball cards.

It was 1997. I played basketball every day after school and was obsessed with the NBA, the Chicago bulls and Michael Jordan. Once a week I would take the tram to a comic book store in Vienna’s inner district to buy a pack of cards. One pack contained of 5 cards. There were always other kids around, trading, checking prices, looking over your shoulders when opening a new pack. The comic book store was our trading floor. The cards were our stocks.

I still remember the rustling sound of opening a new pack of cards. The smell of cardboard and plastic erupting from its inside. The excitement to see what was in there. Would the pack I just bought contain a rare card?

Everyone in the room was curious to find out.

A token of Michael Jordan from the Chicago $BULLS
A few weeks ago my mom sent me a suitcase of things I kept from my teenage years: school notes, postcards from my first crush, minidiscs with music I downloaded. In the midst of my memories I found a Michael Jordan basketball card. I forgot that I kept it. But seeing it I remembered immediately that it was the card worth the most in my collection. I kept it in a plastic container for preservation. I probably had a hunch that one day it might be worth something.

I discovered that it’s worth 1225 USD today.

To the moon
Last month I spent 880 USD on “minting” an NFT.

NFT stands for “non-fungible token” and is a term used to describe a unique digital asset whose ownership is tracked on a blockchain, such as Ethereum. The most popular use case of NFTs are digital images, i.e. artworks that often get acquired for thousands, or in some cases, millions of dollars. Many wonder why people pay such amounts of money for owning a digital image.

The artwork I bought was a Channel S0 Founder NFT. Channel is a decentralised media organisation aiming to build new tools for creators in the web3 era. For its launch, the team created 666 S0 Founder NFTs that acted as tokens to participate in the project’s early development and get access to its podcast feed.

When I heard about the project I was excited and critical at the same time. I loved the fact that a group of artists and creators got together to build new tools. I followed each of them (New Models, Interdependence, Joshua Citarella) individually before and deeply respected their work. But I couldn’t quite convince myself why I would spend the equivalent of (then) 880 USD to get access to a podcast feed. The podcasts were the only tangible content you would receive; the rest was mere speculation for a project that early in its development.

Channel launched its collection of S0 Founder NFTs on January 26. Created by artist Sam Rolfes, the Channel tokens are digital renderings of rocks inscribed with the logos of the three founding communities. Each rock looks different and unique. They convey the feeling of ancient rune stones from a Lord of the Rings-like fantasy world. 666 of them were available for the initial guild of believers.

Minute by minute the counter on the website went down. 200 NFTs sold. 300 sold. Only 350 left. Channel retweeted some of the profiles that proudly announced the rocks they just acquired. A lot of them were artists, researchers, creatives who I’ve come across before and often admired.

I closed my computer. Around 10PM I called my girlfriend and told her the story. It went like this: “This project launched, I love the idea but I can’t say if it will work, it’s very early stage still but they got these NFTs created by an artist, they look kind of cool, people actually buy it, but I would never spend 880 $ on a digital jpeg.”.

And she was like:

“You clearly seem excited about the project.

Why DON’T you buy the NFT?”

Shortly before midnight I checked in again. Only 200 left. I logged into kraken.com, the crypto exchange I use. I bought 0.33 ETH worth 880 USD at the time. I transferred them to my Metamask wallet. I clicked the link channel.xyz/mint. I connected my wallet to the interface. I transferred 0.33 ETH. I checked opensea.com, an NFT marketplace. And there it was. My Channel Season 0 Founder Token.

I'm a true investor
The next day I woke up and wondered what happened. It took me a few days to process why I spent this amount of money on something I couldn’t rationally explain to myself. I would still never spend 880 USD on a podcast that I occasionally listen to. But then I realised that this was not about content.

The Channel NFT acted as a token that opened up a few things for me:

  1. Access. The token gives me access to a Discord server where I receive information, learn and can connect with other founding members.

  2. Participation. The token gives me permission to participate in the project and/or its culture, in whatever way that may be defined.

  3. Belonging. The token makes me part of a group of 666 founding members that assigned the same value to the project / were willing to pay the same amount for getting involved.

  4. Status. The token (visible through Opensea and my Twitter profile) signals my involvement in a project that I, and others in my sphere, deem relevant.

  5. Speculation. The token acts as an investment into a project that might increase in value as it becomes more popular.

Similar to how basketball cards were tokens that created a relationship to the world of basketball when I was 13, Channel’s token is the key to a world that relates to my interests today. To people outside these value systems neither the Channel s0 digital jpeg nor the plastic-coated cardboard of my Michael Jordan card have any value.

My parents still don't understand.
Each NFT holds a different value mix. If you're buying a NFT mainly as an investment, then that chart will be mostly defined by Speculation and Status as your value signifiers.
At the time I invested in my first NFT, I read the diary of Brian Eno. Eno is a musician and producer, most notably known for his pioneering work in ambient, pop and rock music of the past decades. In 1995 he set himself the task to write a diary consisting of everyday observations and thoughts resulting from his work. Many of his notes, written at a time when the world wide web 1.0 became popular, are still relevant today.

One of his footnotes read:

Reading this, I realised that part of my hesitation to buy the Channel s0 NFT was that I was searching for the intrinsic, objective value of it. It didn't have any. What made me buy it instead was the atmosphere of confidence it created. I was ready to engage with and happily surrender to the world Channel suggested.

NFTs in that sense are “magic beans”, as Venkatesh Rao described them. They may or may not are access passes to a possible future that is partly created by the author(s) of the NFT and partly created by the expectations the holder projects into the token. Therefore no NFT is like the other and one NFT can have an entirely different meaning for one person than to the other.

With that definition in place
I believe that much of the criticism around NFTs and crypto can be broken down into people who do believe that objective value exists, or should exist, and people who don’t. As long as you believe that objective value exists you are puzzled why people pay millions of dollars for an illustration of a Bored Ape Yacht Club monkey.

But once you accept that the way value is created is increasingly decoupled from the institutions that previously held the authority to determine it (like banks, museums or states) and thus becomes highly subjective, fluid and controlled by uncontrollable protocols –  you can make sense of it.

Value is the product of the quality of a relationship between the owner or viewer and the atmosphere of confidence an object and its authors are able to create.
Jacob Horne, a founder of NFT platform Zora, said in an interview that the moment he wanted to get involved in crypto was when he realised its potential for anyone to create value systems. From what I see, and experienced myself, I believe that’s true. The last remainder that coupled the value of an object, artwork or not, to any objective instance a majority of people agreed on was currency. As in, currency that was being centrally controlled. Now that blockchains opened up the way for any person or project to create their own currency, the cards of how value is created and who determines it are being reshuffled.



On a sunny day in 1998 I stopped trading basketball cards.

Me and my best friend took the tram back home from the comic book store. His collection was way better than mine and he had shown his album of rare cards around in the store. As we exited the tram and walked in a quiet street, two older boys appeared behind us. They secretly followed us from the store, riffed the album from my friend’s hands and ran away. We were shocked. My friend was devastated, tears rolling down his cheek. The two of us, 13-year olds in nice-and-quiet Vienna, reported the incident to the police. The thieves were never caught. The album of rare cards did not return.

Eventually, we went on with our lives.


Thank you for reading. If someone forwarded you this email please subscribe at co-matter.com/newsletter. For any questions, ideas or remarks send me an email at severin@co-matter.com.

This email was sent to *|EMAIL|*
why did I get this?    unsubscribe from this list    update subscription preferences


Zossener Str. 41
10961 Berlin
Management Board: Severin Matusek
Court of Registration: Amtsgericht Charlottenburg HRB 195395 B

VAT ID: DE317741247

Last updated: May 14, 2024 ■ 17:35pm