by Selby @SelbyFox | Art by Alts @Alts_Anonymous
The Future of Luxury
The word lukso is how you say ‘luxury’ in the Esperanto language. But, we’re actually here to talk about crypto… so how does luxury fit into the digital world? It’s about understanding that blockchains are the modern-day vaults for value.
Value is subjective, but storing any value on a blockchain tends to get more expensive over time, as the traffic and popularity increases. In this way, low-value transactions become impractical and higher-value transactions tend to take over. When you look at it this way you can view most blockchains as a type of ‘luxurious’ technology for preserving value.
One such blockchain is LUKSO, a base-layer network, with its own security mechanism, as well as a native utility coin ($LYX).
But, how do we define luxury in the digital landscape?
"To me luxury means everything above our basic needs. So all social interactions, for example, as well." -Fabian Vogelsteller
In other words, we’re not going to be using the blockchain for groceries…
So, are there use-cases for high-end items like designer clothing, cars and real estate? Absolutely… and LUKSO will likely play a major role in those industries. But, let’s explore ‘social interactions’-as-luxury first, because this is where the cutting-edge growth is taking place, right now…
In the metaverse!
A video game is just an entertainment product… until you interact with another player, at which point it becomes a social platform.
Add in assets, commerce, creative-arts and standards that allow you to move what you own across platforms easily… now you have a metaverse. VR makes this digital experience more vivid, but isn’t strictly necessary. The important part of the equation is the social interactions, asset ownership and interoperability of various platforms.
This already exists in crude forms… but, it’s not a rich or user-friendly experience.
We are still in the very early days.
Take the NFT craze, for example. As silly as it seems, it’s proving how a creative use-case can operate on the blockchain, both in the form of securing intellectual property rights, as well finding market value for digital art.
The provenance (verifiable history) of your assets will give them a provable value that cannot be forged. This is the cornerstone of blockchain technology.
Verifiability is the future of ownership, and LUKSO is expanding on this idea by creating a blockchain tailored to the New Creative Economies, which include luxury, fashion, social media, music and the arts.
The future of luxury is going to be a very rich experience, indeed.
The Team Behind LUKSO
While every project needs intelligent and hard-working leaders, there’s another important principle that gets over-looked in crypto, which is ethical behavior. The LUKSO Team has been provably ethical in their business practices. They have gone through the proper channels to register with German Regulators (where they are headquartered), and they understand that they are building the future, not just their own personal wealth.
Fabian had an important impact during his time with the Ethereum Foundation, where, amongst his many accomplishments, he and Vitalik Buterin created the standard that led to the ERC-20 token boom of 2017.
While this standard has been extremely important to the growth of the crypto ecosystem, Fabian also witnessed the creation of thousands of shit-coins, as well as pump-and-dump schemes, because anyone could now create their own tokens.
In the spirit of a more fair and steady distribution, Fabian and the team invented the rICO (reversible initial coin offering), which went through German Securities Regulation in 2020, and is how LUKSO raised their operating capital. You can read more about it HERE.
This is one of the reasons Fabian takes the approach of not talking about price, nor does he engage much with those who obsess about price… you can hear his exact words in this Cat’s Clip where Fabian tells the moonboys to chill out.
You can also learn more about Fabian’s long list of accomplishments in this Crypto Capitalist article (Who Is Fabian Vogelsteller?)
Marjorie is another enigma of the blockchain world… an accomplished woman in a male-dominated industry. There have been many accounts from people in the community, who have spent time with Marjorie, that she is focused, driven and determined to introduce crypto and blockchain to the digital creative economies… which will consist of digitals, physicals and the blending of the two… “phygitals.”
Both Fabian and Marjorie understand very well that as successful as Ethereum has become, the interaction with most blockchains requires a bit of a learning curve and can be scary for new people.
Marjorie has said “we want the technology to disappear behind a beautiful user experience.”
And in this way, only when blockchain is safe, easy-to-use and intuitive will it gain mass adoption.
The Road to Mass Adoption
LUKSO’s goal is to make blockchain accessible to everybody.
LUKSO borrows heavily from the Ethereum architecture… but, as Felix Hildebrandt says in this extensive in-depth article… LUKSO is “not an Ethereum competitor, rather a sibling for a different industry.”
As was said in this Luxury Meets Crypto article the two blockchains are like different neighborhoods in the same city… Ethereum is like Wall Street and LUKSO is like Madison Avenue.
This new neighborhood that is being built will incorporate new infrastructure and new solutions.
Let’s explore a few of the primary new solutions that LUKSO is bringing to the blockchain ecosystem. The technology that solves each of these threads them together beautifully;
-Re-invented a lot of standards (LSP’s)
-Identity on Chain
-Flexible Smart Contracts
User-Friendly “wallets” aka flexible key-managers. Currently, to operate on the blockchain you need to secure a private seed phrase. This serves as your “password” and if you lose it, your assets are lost… nobody can rescue you, that’s it, you’re done. Also, if that passphrase is stolen… also done.
In a nutshell, Universal Profiles are an upgraded version of our current “wallets” that add more flexibility in how you manage your private keys. You can delegate permissions, share recovery passwords without compromising your asset’s security, block unwanted spam transactions and a lot more…
This will all be done in an intuitive user-interface that doesn’t require a PhD in quantum physics to use.
Ethereum uses the programming language Solidity… and so does LUKSO. In fact, LUKSO is essentially a “fork” of Ethereum. So, protocols are compatible across the two chains.
This is extremely important because Ethereum has set the precedent for Smart Contracts (aka the beginning stages of mass adoption)… and just as Web2 required protocol standards which we all use to this day, Web3 needs standards that make building dApps and projects usable across a many-blockchains world.
First let’s define Soft vs. Hard identity. Hard identities are issued by governments and large institutions. These agencies are going to adopt blockchain just as slowly as they adopted Web2… very slowly and very crudely.
Fabian has said that everyone trying to solve the hard identity problem is going to face a lot of frustration and will likely end in failure.
The better solution is to solve soft identity first. This is what we use to interact with each other (aka social media and other “reputation” systems), as well as private verification, such as KYC info (dealing privately with companies).
Now before we get into a dystopian argument about control of personal information and privacy, LUKSO is giving the end-user control over how much they choose to reveal. So, again… the user has a better experience and full control.
LUKSO is solving soft identity also through the multitude of options found in the Universal Profile. Again, taking what has worked in blockchain (provenance) and adding more features and functionality.
Each one of these categories is deep enough to have a book written about it. But, let’s keep it simple.
If you trust a company, you can give them permission to make blockchain transactions on your behalf.
The easiest way to explain this is if you want to buy an expensive jacket and don’t have time to “register” it on the blockchain yourself, you can give that company limited-permission via an app (connected to your Universal Profile) that will handle the transaction for you.
Because you just bought a $1,000 product and they want your experience to be flawless. You give them a one-time permission and now that product is registered on the blockchain for you. No fees, not hassle, no security risk. Just straight-up good customer service.
Flexible Smart Contracts
ERC-725 has two new sub-standards that allow for a much richer experience when it comes to calling information from other smart contracts, as well as how information is stored.
The new protocols allow much more flexibility in how smart contracts interact and can be modified. Additionally, the way hash references are stored in smart contracts is much more flexible.
These are complicated subjects, but so is the engineering in your car. Yet companies have made it easier and easier to drive. Why should we expect any less from blockchain technology.
If you’re ready to graduate to LUKSO 202 then check out Felix’s 3-part article that takes you even further down the rabbit hole.
We’re going to keep this brief, because the Tokenomics of LUKSO is a moving target at the moment. We know for certain that there are about 15 million coins in the current circulating supply… and another about 18 million were unlocked when Mainnet launched on May 23 2023
We know that originally there were 100 million proposed as a hard cap, but The Genesis Validators that started the network have chosen to launch the Mainnet with only 42 million LYX. LUKSO also implemented EIP-1559 (meaning some part of each transaction fee will get burned) so the supply could (in theory) become deflationary, similar to Ethereum.
In this scenario the max supply would be open-ended, but a small number of coins would be burned in every transaction, and over time the supply would actually reduce.
Check out this article if you’re interested in learning more about Tokenomics and the Genesis Validators.
Can’t forget about staking! LUKSO is a PoS Network, meaning instead of “mining” coins as a way to secure the network, a much more energy-efficient mechanism is used where only the computing power that is needed to validate transactions is used.
Validators allow their computer (node) to be used to create a decentralized network and in return they earn rewards for their effort. This is done by staking actual coins in a smart contract, where if the node acts improperly a small penalty is applied to the actual balance (slashing). This incentivizes good behavior, which leads to earning an APY% on your staked coins.
-When referring to the brand (or blockchain) it is appropriate to always capitalize LUKSO.
-When creating a derivative word, such as the Luksoverse, it is not necessary to capitalize all the letters.
-Pronounciations: LUKSO is pronounced “luck-so” by most English speakers, however the root word was created by a European and is pronounced “look-so” in Esperanto. Either is acceptable.
-There has been some debate about how to pronounce the LYX coin… however, you can clearly hear Fabian say “lucks” here and Marjorie refers to it as “lucksy” here, likely in reference to LYXe.
-A blockchain’s native “currency” is a coin… a derivative is called a token.
-The ticker symbol for LUKSO is $LYX… the Y and X are in reference to the two new standards LUKSO created; ERC-725y and ERC-725x which are also in reference to “identity.”
-LYX is a utility coin, meaning it is needed to create transactions on the LUKSO Network… this creates demand for the coin. But that’s not all, kids. It has unique properties where end-users can create derivative tokens and NFTs
Thanks for reading our LUKSO 101 article. Big thanks to Alts for producing the best art in the LUKSO Multiverse. Special thanks to Jordy for relentlessly driving this project forward. Thanks to LuksoCat for finding, gathering and sharing all the best LUKSO content gems. And thanks to everyone that contributed to the new Luksoverse website… check out the whole team here.