Creator Tokens — Bigger Than DeFi?
One thing that blockchain startups and traditional businesses have in common is that they rely on the network effect. It means that in order for them to succeed, there must be a point of critical mass or adoption which would allow the business to earn significant revenue to continue to improve the product as they scale. This is also the reason why many of the ICO-backed projects launched back in 2017–2018 are having difficulties gaining their footing.
Because crypto was becoming so popular at that time, people felt inclined to be a part of that ecosystem one way or another as early adopters. The focus back then was all about marketing the technology, but very few individuals (VCs, Fund Managers, Experienced Stocks Investors) actually assessed the difficulties of pulling off projects of the magnitude they were played up to in their whitepapers. The aftermath of this era will be something that will be remembered as one of the major catalysts for turning things around in the industry.
Since then, the landscape has changed drastically. Products built on this foundational technology do not rely on telling people that blockchain is the be-all-end-all to their problems, but rather serves as a ‘silent backbone’ on which platforms could leverage to create brand new forms of value. Just like how there are billions of users on the internet today, not even 1% of the entire online population knows what TCP/IP is. The same philosophy is being applied to blockchain, wherein the simpler the front-facing products are, the more likely it is to be adopted by the users.
Metaverse games using NFTs like Axies Infinity, Mist, and Cryptoblades are primary examples of those platforms leading the charge, focused on unlocking value through the ‘play to earn’ model rather than feeding technical jargon to their users. It’s easy enough to explain how they work that people could jump on within a matter of minutes. NFTs could also be sold as digital artworks tied to a ‘token of authenticity’ to prove ownership and uniqueness, and we all know how lucrative those are right now.
Beyond games and beyond even applications in the financial sector (DeFi), there is a huge and untapped opportunity lying in the Creator Economy. The word ‘disrupt’ is tossed around frequently these days, but there’s no better term for this specific industry. Case in point, $800 million in investments has been pumped into this industry since October 2020. On the individual level, for creators spending 4+ years on their platforms, 46% of them are earning over $20k annually.
As of late, the concept of Social Tokens have been explored. It’s a wide array of applications that essentially mean that any person, group, or brand could create a token that derives its value from various applications. The following are the most popular forms of social tokens:
- Personal — Represents the value of the individual. These tokens are sort of a ‘bet’ on the future value of an individual by fractionalizing themselves in the digital world using this technology. Alex Masmej is an example of one of the pioneers of this application.
- Community — Represents the value of communities and could be used to gain decision making privileges. DAO’s are an example of communities that are benefitting from this.
- Brand — Represents the value of the brand of an influencer, a business, or an organization that comes with various perks such as 1:1 interactions and exclusive content. Lil Yachty launched his own brand token in late 2020.
We built BitFans as a platform that converges all three of these concepts into one. We cater specifically to content creators, brands, businesses, influencers, tastemakers and even charitable organizations. With a few clicks, anyone with access to an audience can create their own social token — we call them Community Tokens in our case.
All of the functionalities are baked into one, meaning that as a creator on our platform, you are essentially tokenizing not only your own value, but the value of your community as a whole. With voting tools, your community members could play a part in important decision making processes to align both creative and economic interests. By introducing incentives to hold or utilize the token within your digital economy, you are promoting growth not just for yourself, but for your members as active participants and co-owners of your brand’s community.
An established industry with a lot of existing users like the Creator Economy is simply a perfect application for cryptocurrency. We aren’t trying to reinvent the wheel by requiring a large number of people to adopt complex platforms and protocols. These consumer bases exist, and we are filling the gaps in the industry. Our premise is simple — BitFans is enhancing and maximizing the potential of creators worldwide by creating a means for them to discover new forms of engagements and value with their audiences. Community Tokens are a means to develop digital economies, discover valuable insights, and align with communities that have similar affinities. This will unlock the true value of content creators and develop an ecosystem where all participants are exposed to the upside of a brand.
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