>> Announcer: Live from San Juan, Puerto Rico it's theCUBE! Covering Blockchain Unbound Brought to you by Blockchain Industries

(Latin music) >> Welcome back everyone, this is theCUBE, exclusive coverage of Puerto Rico covering Blockchain Unbound's global conference where token economics meets the real world global society, Blockchain decentralized applications, and of course, cryptocurrency all kind of coming together You got investors, you got developers, you got billionaires and millionaires, and you got the capital markets all rolled up into one My next guest is Andrew Prell, founder and CEO of Convergence, entrepreneur, visionary, experienced entrepreneur, welcome to theCUBE >> Thank you very much for having me! >> So you're doing some really radical, not radical, progressive, I mean radical sounds (mumbles) Awesome things, you're re-imagining gaming >> Andrew: Correct

>> Got a great team of people who have seen that movie before, literally, seen the entertainment side of gaming, the pro gaming side to the tactical gaming side, take a minute to explain what you guys are doin' that's super fascinating, how it works in this new era >> So, we're re-imagining the entire game space, when I say that I'm talking the consumer side, that's cell phones all the way through consoles and PCs, out to the out-of-home entertainment side, which is arcades, location-based entertainment and full-blown theme parks, and marrying them all together with one backbone platform that allows all of the devices to interact with each other in the same game space So you can be in a $300,000 simulator at Disneyland, workin' with guys on cell phones against guys in their head-mounted displays Any of that, they all work together in one game space >> So basically the world is the device, every device

>> Yes >> On the network, IP connection or global, player, console, screen, and you're connecting them all together Hence Convergence >> Right, we're giving every device in the eco-system it's proper place and it's proper prestige 'Cause if you've got a $5,000 gaming rig, you don't think a guy with a $800 cell phone should be at the exact same level, but maybe 10 other cell phones could be a equal match to you

>> Take me through a use case of how you're going to converge this all together So you talk to some purists out there, "I've got a 4K monitor, I don't want this cell phone guy "comin' in here, he's got lag, "I got all kinds of gaming issues" Does that go away, how does it all work? >> What we're havin' to do is contextual-based interfaces, meaning that your roles and responsibilities in the game space is dependent on the devices that you bring in Because virtual reality is not just the head-mounted display, it's all the new gear coming out with the tactile feedback, the bodysuits, the gloves, the boots, the treadmills, all of that All of that, your roles and responsibilities in each game space is dependent on the device that you enter with

>> So I was at Sundance this year and I had a theme, I did a panel I put together called The New Creative And if you look at all the new artists out there, they want to break down the elite gatekeepers, right? I mean the virtual-reality and augmented-reality world is colliding with film, filmmakers You got YouTubers out there with a million, 10 million subscribers, built-in audiences, this new technology coming out A lot of people are bringing storytelling, filmmaking, and it's just really in the early stages right now People love the characters, but you start to see the new kind of format

Does this play into your world? I can imagine that, if you're thinking to be disruptive in the way you're thinking, new games're going to emerge so it's not thinking about the old games, it's thinking about potentially new games >> Andrew: Correct >> How do you view that, is that somethin' that you see? What's your reaction to that trend of this new, multifaceted VR, AR >> We see that everybody is going to get to play together, cross every device, the developers are going to get rewarded for creating content, people are going to be rewarded for creating things inside of the games, and the players are going to get rewarded for doing all the top things, and getting to the top levels of all the games, and we're going to reward them through our cryptocurrency >> We're in Puerto Rico obviously, this world's goin' to another level, Brock Pierce, his community, the Blockchain community, they're comin' to Puerto Rico, tax incentives, the government's here opening up their arms, But you're starting to see it go to the next level

These early industries you got the entrepreneurs and the promoters The promoters promote the entrepreneurs, there's a lot of love goin' back and forth But then they hit that threshold, the capital markets come in, you know, you start to see the opportunities, but the money start flowing in It's kind of happening now, so it's goin' the next level In your opinion, token economics; now that there's so much money flowin' in, now that people see that Blockchain's legit, now that people see that this is actually a new model, not everybody, but majority-a' people in the industry are all noddin' their heads, "Okay, Blockchain's "got some potential, token economics is a legit thing, "it's disrupting capital structures, "it's disrupting funding

" How is it disrupting the gaming business? Can you share your opinion on that? >> People don't understand the overall impact We didn't understand the overall impact A lot of the investors coming in still don't fully understand the overall impact I was in a discussion the other day, I'd written some articles in Medium about token economics, and about the virtuous circle of a token-based investment fund Meaning everything that it invests, all the fees, everything coming out of it, is all based on a token inside of an ecosystem

We're about to head to GDC, Game Developers Conference, just like Kevin Bachus did for the Xbox, we're going out there to license and buy up all the content that we can through our tokens Now the cool thing here, the thing that just makes the investment, the cash funds dead, is a dollar bill can not change in value other than go down over time slightly So we'll just say the dollar bill doesn't change in value If I was Kevin Bachus back when the Xbox was coming out, and I went and invested a million dollars in a hundred companies in crypto, say the Xbox is crypto, and you could only get to those games through the token, which is what we're doing, and I found Halo, which, a hundred-million people bought the Xbox just because of Halo, then what that does for a cash fund is everybody pats each other on the back because you've got one game that's goin' to exit and that's kind of cool, but that's it Doesn't affect the rest of the economy other than a nice network effect

Halo gets a hundred million users, the next guy might get five million of those or 10 million of those, that's a nice small impact When you do it with crypto, and you start out with a penny token, that you put a million dollars into a hundred companies, and you find that Halo, and it explodes, your penny token might go to 10 cents So what you just did was you just 10-exed what you invested into Halo >> It's a futures contract on gaming >> Well

>> Kind of >> I'm not going to talk to that point (laughs) We're going to just talk about this example, is you 10-exed, you went from a million to 10 million in Halo, but you also 10-exed every single investment you just did, and you 10-exed every person in that ecosystem that's involved in it, that's getting paid in it Your suppliers, your publishers, your media >> John: Everyone gets paid

>> Everybody get 10-exed because you found Halo So that makes this whole ubiquitous ecosystem involved with everybody else, meaning I get rewarded if you get rewarded, so everybody helps everybody else >> That is exactly the model of token economics >> Exactly, it explodes because it's so powerful >> This is interesting, the inefficiencies of the process that you pointed out, the old way, is eliminated by the new model

Hence, the people who pick up the game are the participants who shorten that efficiencies >> I had a guy the other guy ask me, "you're not asking for enough money with your ICO, "'cause you've got to go invest in all these companies" And I was like, "you don't understand token economics!" All I have to do is unlock the power of my token and invest with that, and I've already proven, back in 2015 we proved that a lot of the game developers would take our token without it even having a secondary market >> You haven't even gone to a whole 'nother dimension that you don't even have to go to now, but that's future, is the role of consensus in these communities really also do the filtering at many levels

>> Andrew: 100%! >> If you look at what Activision got their ass handed to them, all you got to do is look at the Reddit threads The whole gaming thing is, no one wants to see games go corporate Because they had to force a business model, this is a huge issue, people are losing their shirts "Oh, great creative studio, they sold out, game's over" The audience flocks away, why? 'Cause they have no incentive

Do you agree? >> I agree a 100%, but there's a lot of professional investors that don't So we broke up the sum of our funds that we're investing into all these startups, we broke it up into 10 funds, and we're going to turn it into a game We're going to give one of the funds purely to our token holders, and do a consensus model, and let them vote on what they think we should, what should be in our network And they're going to go up against nine other investors I threw down the gauntlet

Whoever gets best wins the extra bonuses >> So are you raising money now or did you raise the token sale already? >> We're closing out our private presale, and because of Blockchain Unbound I doubt we'll actually hit the open market with the ICO, so people will have to go to our developers that we invest in, and get the tokens through them somehow >> Good success year, huh? Blockchain Unbound been a good success for you? >> Oh yeah, Brock Pierce is on board, been pushin' behind us since Cayman Him and Crystal both fully supported us and we're havin' awesome >> What's your advice to people out there, scratchin' their heads, "Andrew, give me "the 101 on token economics, what's the bottom line, "what do I need to know about, where do I get started, "what do I do?"

>> Once you get your token actually, say, authenticated, realized, everything's transparent, and it gets on that secondary market, it's better to use that to invest in anything you need to invest in Get everybody incentivized around your token All your employees, all your vendors, everybody incentivized around that token, it's a 1000% more powerful than a dollar, 'cause a dollar doesn't go up in value Your token can go up and down, but trends up, and as soon as you find just one spark that blows up, everybody, all boats rise equally It's awesome

>> All right, Andrew Prell, CEO, reimagining gaming Token economics is a disruptive force There's math involved, every company will need a a chief economic officer, that'll be a new title, we'll be certainly seein' that out Thanks for comin' on theCUBE, 'preciate it I'm John Furrier, you're watchin theCUBE

Exclusive coverage in Puerto Rico for Blockchain Unbound Part of our two-day wall-to-wall coverage, thanks for watchin', we'll be back with more after this short break