Cardinal is a Solana protocol that enhances the utility of NFTs by allowing minters and holders to issue them to beneficiaries with intrinsic caveats governing receipt and ownership. The Token Manager program is a wrapper protocol that achieves conditional ownership of Solana NFTs by facilitating programmatic management of its lifecycle according to specified parameters. Its modularity allows for many use cases, including rentals, identity tokens, tickets, subscriptions, and expiring items.
Manny, Cardinal’s Business Development Officer, joined us for an AMA on September 26th.
vVv: Could you briefly introduce Cardinal?
Manny: I’m Manny, Head of Business Development at Cardinal labs. We are a Solana protocol that enables conditional ownership of NFTs, and we’re doing this through rentals, staking ticketing, and much more. We are at the forefront of all NFT utilities on Solana.
We have three major pillars, one of which is staking. We have the only on-chain non-custodial escrow staking. We’ve processed 100,000s of staked NFTs. Our rental marketplace, which is pillar number two, has surpassed 25,000 rentals. Cardinal is currently the only rental marketplace on Solana.
And then there’s NFT ticketing, which is what we’re most excited about and would be our third pillar. We’ve partnered with prominent artists and will do events worldwide using our NFT ticketing system. Also, our protocol has different use cases: whitelists, allocations, vesting, etc.
”We are at the forefront of all NFT utilities on Solana.
vVv: Which one of the three pillars do you see having the most potential?
Manny: It has to be ticketing. Staking is excellent, but for now, it’s focused primarily on NFT projects. Rentals are pretty cool. When Web3 gaming comes to fruition and becomes the norm in our society, then we can see our rental platform becoming huge. But we still think that’s still a couple of years away. As far as ticketing is concerned, that is the most lucrative. Imagine having many venues, artists, comedians, musicians, and everyone using our ticketing platform. And it is already starting, and although it’s brand new and we are still in beta, we have had a lot of interest in using this platform.
vVv: What’s the USP for your ticketing platform? How do you pitch the platform to an artist? And why wouldn’t they work on their NFT collection or go to a competitor?
Manny: On Solana, there aren’t many competitors. There’s one competitor in the building phase, but it needs a working product. Our platform has working products and actual use cases. From the artist’s point of view, the reason for NFT ticketing is to prevent ticket scalping and loss of royalties. For example, upon opening a public concert ticket sale, there are immediately scalpers purchasing hundreds, if not 1000s, of tickets for resale at a multiple of the original purchasing price. Those who genuinely want to attend the concert now have to purchase a ticket at exorbitant prices, which creates an abysmal user experience. In turn, the artist should receive these royalties, not websites such as Ticketmaster, StubHub, etc. They’re looking for a ticketing solution where they can sell tickets directly to consumers and then generate revenue from secondary market sales. And then the second aspect is tracking concert attendees, those who scanned to attend and then air-dropping them merch coupons. If you have a restaurant like Bad Bunny does, you can give them a 25% off coupon for attending the concert. The possibilities are endless.
vVv: Is it a coincidence that you mentioned Bad Bunny, or do you have any potential collaborations or events planned with them?
Manny: We deal with the same agency. But nothing is planned with Bad Bunny yet.
vVv: What is the ticketing system doing in practice?
Manny: We just released ticketing for early access beta to select partners where any project or company can create an event on our site. Ticketing allows projects to sell and distribute tickets as NFTs. There is a scanning feature where you can scan NFTS at event sites to verify ownership on-chain and gain event access. These NFTs can serve as POAP (Proof of Attendance). After the event, organizers can still interact with attendees via airdrops. It is a full-fledged end-to-end solution for NFT ticketing that any project will soon be able to utilize.
vVv: How does staking work in practice? Can you give us an example of an NFT collection that uses the staking feature Cardinal offers?
Manny: In traditional staking, you deposit the NFT into a staking pool, removing the NFT from your wallet. The main issue with this method is the difficulty in accessing different Discord channels, DAO channels, and NFT-gated content online. For us, the question was, “how can we make this non-custodial where a deposit of an NFT into the same stake pool will return a wrapped version of that NFT that is non-transferable and will be frozen in your wallet?” This way, you can still access Discord channels or anything token-gated online. And even if it’s a game, and you’re staking a weapon or a skin, you’d still be able to stake but have it in your wallet where you can use it in-game. As we continue going forward, we see different use cases arise.
vVv: Please explain the reasoning why you chose Solana over Ethereum. Are there some technical limitations where this wouldn’t work on Ethereum, or are there other factors?
Manny: There are five of us on the core team, and we’ve been in Solana since day one. Solana was not just the fastest, cheapest, and most efficient chain; it helped us build at the speed we wanted. Solana gives you room to build most of the games on-chain. And thus, it made the most sense for us to build our rental platform on it. You can visit our platform and see that our top collection is an actual game. On Ethereum, it is a little more challenging because of its dynamic nature. The Ethereum token standard would require some alterations for us to build what we would like to on it.
vVv: Can you share additional information about the team and their background regarding NFTs and blockchain?
Manny: We are a team of five and went to school together. We worked at Apple and Goldman Sachs, and when we had a clear vision of a goal in a niche market to tackle, we took the initiative and created Cardinal. We started with basic staking, then looked at implementing conditional ownership, and now we are transitioning to ticketing and much more. We are all friends tackling one major goal: adoption and getting real-world use cases for Solana and Web3 in general.
”We are all friends tackling one major goal: adoption and getting real-world use cases for Solana and Web3 in general.
vVv: What’s the personal driver of being part of the team and building Cardinal?
Manny: I would love for Web3 and blockchain to be integrated into our daily lives. When a musician with a concert tour reached out to us, stating that he wanted his tickets to be NFTs, we saw the opportunity to create a ticketing solution. It’s not monetarily incentivized. It would be cool to see a stadium or an arena of people using our solution for entry access if we can change the industry of video games, cool. Today, the way people play Fortnite or Call of Duty, if that could change in 10 years using our technology, that would be cool. For us, that drives and motivates us.
”It's not monetarily incentivized. It would be cool to see a stadium or an arena of people using our solution for entry access.
vVv: We had a recent AMA with NFTfi that provides a platform for loans against NFTs. In their case, the NFT goes into a custodial wallet in NFTfi’s smart contract, which means while you take out a loan, you cannot benefit from the utility of the NFT. Currently, they are working on a solution. Does Cardinal want to provide loans for NFTs as collateral on Solana potentially?
Manny: Not us, but we do have partners that do. On Solana, we work with several other loan companies that provide this service, with the biggest one called Sharky.fi.
vVv: What other chains are you looking at if you plan to expand?
Manny: EVM (Ethereum virtual machine) chains are our next logical step. Can we do stuff on ETH or Polygon, etc? It’s just a thought, and we’re not taking action.
vVv: I’ve seen many Solana collections receive a lot of traction. And I’ve also seen many of the collections on ETH plummeting and losing direction. Do you see a trend? Do you see an opportunity to double down on Solana rather than expand to Ethereum?
Manny: For us being native on Solana, we just see the possibilities. And I’m saying this not as an NFT trader but as a true builder. There are so many possibilities and things you can do on Solana that are more challenging on Ethereum. ETH is slower and more expensive. Certain things have to go off-chain to work correctly. Since Ethereum came first, it still has the upper hand. But I encourage everyone, even ETH maxis, to avoid being stuck on one chain. Check out Solana and see what’s possible. You’ll find things move much quicker. It’s more efficient and cheaper – all these matters, especially when you want to onboard casuals and normies into the space.
”There are so many possibilities and things you can do on Solana that are more challenging on Ethereum….all these matters, especially when you want to onboard casuals and normies into the space.
vVv: What are some of the milestones you want to achieve by the end of the year?
Manny: I want us to reach 50,000 rentals; we are currently at 25,000. Because of the Token Manager protocol that we use in our staking, rentals, etc., we are focused on providing launchpads, like Magic Eden, Solport, and Hyperspace, the ability to lock up NFTs with a vesting schedule.
Over the last few months, whitelists have been a massive topic of discussion regarding how much is being allocated to partners, influencers, and advisors since they could potentially dump on holders. We could prevent all of this with a vesting schedule and having their tokens locked up for a period of time by preventing the ability to transfer or sell them. This will prevent not only dumping on the public but also be 100% transparent by being on-chain. You know precisely who’s holding what and who’s getting paid for certain things, not just in money but in NFTs. We’re currently working on that we see pretty good traction there.
”We could prevent [NFT dumping] with a vesting schedule and having their tokens locked up for a period of time by preventing the ability to transfer or sell them.
vVv: What is the use case of the Cardinal protocol in the identity context? Are you going to provide some full-fledged digital ID solutions? Or will it be only linked to social account ID integration?
Manny: Excellent question. Although it probably wouldn’t be us doing the complete identity solution you envision, we are partnering with companies tackling this. Some more prominent companies are trying to tackle this, whether through passports or true on-chain identification. For now, we have all these social aspects where you can interact on-chain with any dApp, and instead of a wallet address, you’ll see your GitHub, Twitter, or Discord ID. We are going to add Instagram and others soon. And one more possibility that a project has developed using our contracts is if you have your Twitter image as your NFT, and you stake your NFT, whether it’s through Cardinal or their site, you will get tokens or rewards. And that’s not just our staking contract but also our identity contract.
”With [Our social account ID integration] you can interact on-chain with any dApp, and instead of a wallet address, you'll see your GitHub, Twitter, or your Discord ID
vVv: How important is it to have the ecosystem built out with attractive features?
Manny: Since day one, the main goal of Cardinal is the adoption of our free, open source and audited protocols, whether that’s staking, renting, or using our Token Manager to do whatever you want in your project. Any project in this field is free to use anything we offer. And we have been focused on how we can get more people to use our protocols and not necessarily building sustainable revenue at the moment; that will come with time and an increase in volume. We just want our product in the hands of as many projects and users as possible. Any deal we do, we first think about how we can get another 1,000 or 10,000 or 100,000 users, inadvertently without them knowing they are using our protocol. And if we can do that, we know we’re on the right track and that we are fulfilling our goals and growing as a company. It all aligns pretty well.
”Since day one, Cardinal's primary goal has been to adopt our free, open source, and audited protocols, whether staking, renting, or using our Token Manager to do whatever you want in your project.
vVv: Are you very proactive in building these partnerships, or do projects seek you out?
Manny: We have our fair share. If you want to use our protocols, you can create a ticket in our Discord, and we can help you there. However, for the most part, we outreach not only Web3 companies but also those in Web2. I have an extensive directory list of ticketing sites that I need to reach out to. I’m going one by one, sending personalized emails and messages each one, the same way that people are reaching out to us. And we genuinely want to build this, and it’s not going to come by us just sitting here on our hands. I’m proactively going out, and our team is actively working and helping people in our community.
vVv: In many other ecosystems, I’ve seen a tendency to focus on building and ignore user base growth. Many developers think that users will come if they develop the best products. However, that’s a dangerous assumption because you need to network and have an active outreach to attract a large and vibrant user base.
Manny: 100%.Many users, even in Solana, don’t know about Cardinal, and our goal is to change that. We are a protocol first, and we want to build and help out projects with their utility and add more to this ecosystem. To accomplish this, we need to perform outreach ourselves; it isn’t something that will sell itself. It’s the same method when we connect with big companies or new projects for partnerships. And you’re correct. Projects can lose sight of that, which is a big misstep. There are no irrelevant small or big fish in this partnership game or outreach game; all are equally important.
vVv: To come up with this approach, do you have a sales background, or is it just a coincidence?
Manny: It’s just a coincidence. I had an exit two years ago from a big company I ran. The challenge before us is what fuels the team and me.
vVv: Do you already have external products integrated with Cardinal? And do you have active partnerships?
Manny: We have so many, I don’t even know where to begin. Regarding staking, we have about 135,000, and a little more now with over 350 total stake pools. So if you consider those partnerships, we have a bunch of those. Our rental platform, we just reached over 25,000 rentals. We go from the top collections to top games to treasuries and guilds to different tools, analytic and token data tools. And then, in our ticketing platform, we are working with artists. In a month, a big Solana event is happening in Portugal, and we’ll also be doing events there. Later this year, an artist will use our NFT ticketing platform for his VIP tickets in Germany.
vVv: What is your relationship with Metaplex? Will they implement your ideas into the ecosystem? And will you be working closely with them in the future?
Manny: We do have a working relationship with them. They are also trying to tackle similar functions to our Token Manager and utilizations such as lockup settings and freeze authority. Our goals are aligned. We want to expand Solana’s reach, particularly NFT utilities, and create the best ecosystem.
vVv: VCs (venture capital) played a significant role in the pre-seed round of Cardinal. What role did these VCs play in the development of the future of Cardinal? What factors does Cardinal look for when choosing VC funding partnerships?
Manny: We have an ongoing relationship with some of the bigger players in our round. We have a schedule where we meet with these players or advisors. It’s not just money coming in. Can they also help us grow? Can they help us with communications and different partnerships? Who do they know that could benefit from our protocols? And can they get us in touch with them? It was not a round where we wanted to raise capital to extend our runway and let us build; we love hearing feedback and having these ongoing relationships. And that’s it, but we’ve done an excellent job of staying up-to-date with most of those guys.
vVv: What are the community-related use cases of the conditional ownership provided by Cardinal? You’ve mentioned some partnerships on Medium, like DeGods.
Manny: We do a lot for DeGods and now y00ts, which will be cool if you’ve heard of that collection. It’s going to be a different type of staking. We’ve done staking for many projects, but in their particular situation, how can we take staking to the next level and provide something novel, and get tokens? We tried to change that to make it more fun and engaging. These are things we’ve thought about recently, especially with DeGods and y00ts, and sooner rather than later, you’ll see what comes out of that partnership. It is a pretty big challenge, but one that we’re up to, and you’ll see it come to fruition with those two collections.
vVv: Are you seeking any marketplaces for the integration of your technology?
Manny: We have reached out to every marketplace on Solana so far. We need two of the biggest players; both have shown interest and verbally said they want this. But some companies say yes and then never follow through. Magic Eden has also shown great interest, but we still need to secure a partnership. For us, it’s just a matter of implementation; if they want it, they can have it. Most of this is open source and audited, and any launchpad can take this, roll with it, and offer it to their customers, which for us would be fantastic. If they need help, we’re available for troubleshooting and implementation.
vVv: Do you see any risk in being open source where someone could copy what you do and try to compete with you?
Manny: This is an exciting topic because many people in the industry want to see more open source software that anyone can build on top of. We open source everything; however, the issue is other projects’ copying. For example, another project is currently copying our rental platform, which goes against our collaborative ethos. If you ask for our help in the beginning and we actively try to help, and then later you don’t want our service and are releasing another rental marketplace using our code? That’s pretty unethical, but one of the downfalls of open source. However, we will innovate a lot quicker. Our code is of the highest quality, we have everything audited, and we’re currently going through a second audit. All this is pretty expensive for new projects. I’d love to see how copycats are going to innovate.
vVv: Upon rental, the token is transferred to the borrower’s wallet. How does the contract ensure that your token is not transferred during the rental period?
Manny: The token is wrapped in our Token Manager, one of our protocols, and the wrapped token is what the borrower receives. It is non-transferable and can not be sold. There is a time-sensitive feature whereby it automatically returns to the lender’s wallet after the duration is met. On our platform, we have the option to relist automatically. For instance, I have a dog NFT, and I list it for rent on the platform. On the site, the cost will be clearly stated, 0.1 Solana per day, or per three days or whatever you choose. Someone will rent the NFT, and it will be frozen in their wallet. They can use it, access Discord servers, play a game, etc. After those three days, it will automatically be transferred from their wallet back to my wallet. And it will automatically be relisted on our platform for rent again. This is our most used protocol, the one we spend the most time on and the most useful.
vVv: How does daily NFT yield work? Does the yield go to the borrower?
Manny: If you’re asking if you could stake this after renting, currently, that’s not supported. However, we are working on a solution for this. For example, if you rented my dog NFT and wanted to stake it, that wouldn’t be possible. The issue is that we know what’s right in that situation. If you’re just getting yield by holding it, then it is some sort of Airdrop mechanic so that would be different. But if you wanted to rent it, to stake it, we don’t know what’s right. Who should be getting the yield, the renter or the NFT owner?
vVv: You could offer two options on the front end for the NFT lender, an option for the borrower to stake and receive the yield and an alternative where the yield is always rewarded to the lender.
Manny: That’s interesting because then you get into the whole scholarship model, like when you could rent out your Axies and get a percentage of the revenues generated by the scholar as the owner. We can look into a scholarship model using this technology.
vVv: Is it possible for someone to rent out an NFT which is currently still vesting?
Manny: No, because the best NFTs are locked. They’re frozen and can’t be transferred. The vesting NFT will remain in your wallet, and you use it to access Discord servers and anything that is token-gated by the NFT.
vVv: If NFTs can be wrapped and are therefore not transferable or sellable, could you use this technique to protect NFTs from scams?
Manny: We don’t have a UI for this, although we’ve thought about this internally. For example, if you wanted to attend an NFT-gated event, but the NFT is very expensive, you would be less inclined to bring your hot wallet for NFT scanning and take on a risk. A viable solution would be to rent out the NFT from your cold wallet to your hot wallet. This secures the NFT in the hot wallet because it’s frozen, locked, and non-transferable. And after the event, the NFT will automatically return to your original cold wallet. We should make a UI for this.
vVv: Solana has suffered from multiple network outages over the past year. Can network failures lead to problems with the time-based expiration, or will they simply be carried out when the network is restored?
Manny: The internal clock will make it happen. We have not had any issues ourselves.
vVv: Do you see a use case for Cardinal within the real estate market? NFTs giving ownership with time-based expiration of the rental time, for example?
Manny: We’ve thought about this. The issue is dealing with real-life properties. I don’t know if tokenizing real-life items is feasible yet. Even in rentals, what am I going to rent? The key to an apartment or a lockbox mechanism where I can access a property for a certain amount of time? All that sounds good, but it’s much more complicated. Eventually, I think we will reach a point where it can happen. But for now, the tokenization of real-life things is more complex than many assume.
vVv: What were some of the biggest hurdles you had to overcome while building Cardinal?
Manny: We build protocols and open source code for others to use and build on top of. The issue is that only so many developers in the space can use our repositories and build a utility for their projects. In our Discord, we always have many open tickets from builders asking for our help. And for us, if we want to scale and build faster, there are better uses of our time than helping people. But we still do it anyway and see it as a challenge.
vVv: What is the most significant future hurdle the Cardinal team has to overcome?
Manny: Making solutions feel like they’re native and not that you’re using crypto or Web3. For our ticketing solution, I’m working with different projects and companies that still ask for Web2 aspects in a Web3 ticketing platform. Something as simple as a name, email, or something that’s not required if the person has the NFT. I don’t need to know who the person is or their name if it is an NFT-gated event. But perhaps that’s what it takes to onboard new users onto our platform. We will continue to innovate while making it as seamless and normal as possible for users.
vVv: Do you expect users to get used to the idea of a wallet? Or would you want to polish the front end, so people don’t notice they are using a wallet?
Manny: For us, I love a solution where people don’t know that they’re using a wallet or don’t know that they are interacting with Solana, Ethereum, or Metamask. It’d be just buying your ticket, like an average person, just like you’ve done for your whole life, and then going to your concert. There are some challenges considering this sometimes needs to go through a wallet like Phantom. I would love to go to my mom and say, “Hey, Mom, go buy this ticket and go to this concert. If she can do that, we’ve done our job.”
vVv: What are your revenue streams? 3% NFT rental fee and 50 SOL for staking pool setup?
Manny: I’ll preface this by saying everything is free if you want to use it. The staking pool fee of 50 SOL is for projects that do not have a developer, and in that case, our team will set it up for a one-time fee. If you have a developer on your team that can implement our repositories, there is no need for this. Our revenue model is fee-based when you claim rewards or unstake. We charge a closing of the accounts micro fee. On the rental platform, we still pay creator fees, like royalties. When you rent, we take 3%, and the project creator also takes 3%. Those are our main ways of revenue for now. As the protocol grows and there’s more volume, we’ll increase revenue.
vVv: What are the key barriers to be solved before the new wave of NFTs?
Manny: Ease of use. There are a lot of things in Web3 that a traditional person needs help understanding. Even with fully educated adults, many of these things are alien. If we could make this easy to understand and accepted everywhere publicly, that would go a long way for adoption. For now, it’s a niche where either you know about this or you don’t, and there is no middle ground.
vVv: Manny, thank you for your time today. It has been a pleasure talking to you, and the community appreciates how you responded to all the questions because some have been very technical, in-depth, and critical. You handled them exceptionally well. And it’s very much appreciated to hear someone be so comfortable answering all those different questions, and you did a fantastic job. Thank you.
Manny: I love to answer as honestly and openly as possible, and if I helped you guys, I’m happy. Thank you for arranging this and for inviting us. We’re always available if you would like to do this again.