Something surprising – and cool – is going on in the New Digital World today: A rising wave of crypto/NFT projects that take on Hollywood and the studio system that’s now co-opted by Netflix (NASDAQ:NFLX), Amazon (NASDAQ:AMZN), and Apple (NASDAQ:AAPL).

For the first time I can remember, Hollywood and the “FAANG” filmmakers are both vulnerable to disruption. So, let’s dive into what’s happening on the blockchain – which projects have the most star-power – and, most importantly: Can they actually win?

New Series Owned By Fans

“Most of the successful people in Hollywood are failures as human beings” is how, I’m told, Marlon Brando once summed things up. But today, the quote is usually trotted out in contrast to Hollywood nice guys like Tom Hanks and Bryan Cranston.

However, even Tom Hanks isn’t often the box-office draw that he was in the 2000s – let alone the ‘90s. His most recent hits are mostly “Toy Story” or “The Da Vinci Code” movies.

I’d argue this is because we’re primed to expect a lot of reboots, remakes, and franchise sequels. We’re not going to get out of the theater for less than $25… What we see there is probably not going to blow our hair back…

And it’s not really about us! Movies are all safe choices for studios – especially internationally. Even before I had to worry about someone coughing COVID-19 on me, I hardly went, and ticket sales were already on a downtrend in 2019:

Even when one of your favorite stars or directors does make something exciting – it’s probably on a streaming channel, instead! But then, if it doesn’t pay off as a nice bullet point for the next quarterly earnings call, it’ll quickly disappear.

This is the world StoryDAO is launching into. Founders call it “a radical experiment in…building an open Hollywood production platform” on Ethereum (ETH-USD).

“Just like the internet changed funding models to subscription and streaming changed viewing habits, the new paradigm shift is available to us now,” StoryDAO says. Instead of giving your money away as a subscription, you can buy an NFT that conveys community ownership:

You own a piece of the NFT franchise, and you profit if it’s successful. Either way, at least you have a say in the direction of the franchise! Creators can keep making content that its audience wants to watch, and maybe people won’t just quit next month. (Looking at you, Hulu, Disney+ and Paramount+.)

StoryDAO May Be “Radical” – But It’s Not Alone

Celebrities are looking to this model for their next big projects, too. Seth Green, the actor and animated-series producer, has been buying Bored Apes… And plans to turn this one into the star of his own show, “White Horse Tavern,” as a bartender character called Fred Simian. You can watch the trailer here: a live-action show with your animated NFTs worked in.

This was always supposed to be the bull case for famous NFTs, like Bored Apes: Not just profile pictures for rich people – but characters in a franchise that we can invest in and own via NFTs. “Disney on the blockchain,” so to speak.

Mila Kunis is also getting into this game. The actress/producer is helping develop “The Gimmicks” – basically, “South Park” with professional wrestlers – where you can buy an NFT on Solana (SOL-USD) and help drive the plot of the show.

So is Rob McElhenney of “It’s Always Sunny in Philadelphia.” This week, he began recruiting 100 creators to join him at Adim, a project where creators get a (non-transferrable) Ethereum NFT as a share of the IP – and royalties – for their content.

As McElhenney envisions it, Adim is not unlike how he and his friends created “It’s Always Sunny” … But instead of just a camcorder, they’ve got NFTs – for true ownership:

Come do something weird with us at ⁦https://t.co/MRdpnHxudU @Adimverse⁩ pic.twitter.com/etfMoRuzrl

— Rob McElhenney (@RMcElhenney) June 7, 2022

“Adim is building for the next evolution of these groups—communities of creators, writers, artists, designers, developers, fans, and friends working together to create and own a new generation of content,” according to McElhenney’s press release.

So, Can This Be…Successful?

Well, crypto/NFTs are just a new framework for an enduring truth:

“What other asset is digital, has value, and is the largest export of the United States? The film business,” as our own Charlie Shrem told Decrypt in May:

Bitcoin pioneer @CharlieShrem took to @Festival_Cannes to launch crypto film financing project Defiine—and had some choice words regarding $UST. https://t.co/5icvNX2twX pic.twitter.com/xu3a14Crz5

— Decrypt (@decryptmedia) May 25, 2022

Charlie was at the Cannes Film Festival, then Monaco for the CoinAgenda conference, to promote DeFi for financing independent films. Charlie’s project, Defiine, will do it with stablecoins built on Mintlayer (MLT-USD), one of the companion chains to Bitcoin (BTC-USD).

Decrypt was quick to ask Charlie about the recently imploded TerraUSD stablecoin… But instead of an algorithm (plus some bitcoin reserves, as an afterthought…but not enough), Defiine plans to back its stablecoin with “these very secure assets that make up a film budget,” as Charlie explained at CoinAgenda.

Film budgets are largely made up of tax credits, which nearly every U.S. state and most countries offer to film there: anywhere from 20% to 40%. Plus, of course, Netflix (or whoever plans to pick up the film) will pay you, say, $1 million…once it’s finished.

With Defiine, filmmakers can use tax credits, etc., as “collateral” to get startup money – with much better interest rates than a “film bank” – and liquidity from stablecoin investors.

You can hear all about the innovation going on with crypto/NFTs for movies from the CoinAgenda panel, recorded on Charlie’s Untold Stories podcast.

As for the current model: It’s so broken that – despite everyone’s infinite appetite for more new content – Netflix is struggling. Organic growth has stalled out, encouraging NFLX to keep raising subscription fees for more revenue…

But why pay more if you’re not into what NFLX is providing anymore? I, for one, like cutesy shows where I can find out: “Is It Cake?” But I acknowledge that not everyone does. And new seasons of “Stranger Things” can only come around so often. (Next season will be its last.)

Meanwhile, early NFT series have gotten off to a strong start:

Shibuya, an anime project on Ethereum, says it sold out its first “Producer Passes” in 22 minutes! That was in March, two weeks after creator Emily Yang (the NFT art celebrity known as @pplpleasr) announced Shibuya at the ETHDenver conference.

NFT buyers watched Chapter 1 of the “White Rabbit” anime, then voted on where the plot should go. And with all those quick proceeds from the first round of NFTs, Shibuya is doing it all again with Chapter 2 this week.

Then there’s Mila Kunis’ first NFT comedy series, “Stoner Cats.” Those NFTs have sold $13.8 million worth of ETH on OpenSea alone – plus $8 million in the initial sale on its website in August. They’ve been putting out episodes in August, October, and April, and episodes 4, 5, and 6 are in the works now.

This is a good way to make niche content happen that wouldn’t happen otherwise. Maybe it can help continue fan-favorite series that were canceled? After all, Kunis’ own “Family Guy” is an example of a series that got a second act and went on to do well.

I think if a studio like the ones from these celebrities and StoryDAO can keep building NFT series – and gain traction – then these could potentially be crypto businesses that pay off for tokenholders/investors.

Now, Kunis’ The Gimmicks NFTs aren’t selling quite as well as her first series did. Looking at OpenSea (since it’s the largest secondary marketplace for NFTs), The Gimmicks has about 60% of the ownership and far less volume than Stoner Cats sold in last year’s “NFT summer.” So, it’s not all sunshine and roses.

But what I like best about these projects is that NFT innovators keep building in a bear market – creating more demand for Ethereum and potentially Solana in the long run.

P.S. Luke Lango had an excellent take, just yesterday, on whether Netflix will take a bold step – or some might call it desperate – to try and turn things around: “Could Netflix Actually Buy Roku?” Go here for Hypergrowth Investing insights like that from Luke.

On the date of publication, Ashley Cassell did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines. To have more news from The New Digital World sent to your inbox, click here to sign up for the newsletter.