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To say that NFTs played a crucial role in blockchain’s rise to prominence in 2021 would be an understatement.
These days, creators are always looking for new ways to monetize their work or make passive money. For example, Gary Vee made seven figures from selling well-executed NFTs, allowing him to do both.
Perhaps the NFT hype parade is still in full swing, but social tokens look set to steal the show in 2022 as the subject of attention for content creators.
Using social tokens, we can create mutually beneficial online communities without a centralized authority. This article will cover social tokens, why they’re useful, and how you can make your own as a business or content creator.
What Is Social Token?
Blockchain technology is used to store digital assets like social tokens. They provide monetary compensation to creators for their work. If the token’s value increases, its owner may be able to sell it for a profit.
Social tokens are like other digital currencies. However, these tokens aim to empower communities and encourage close bonds between people who have an interest in a common person or product.
A social token is, at its core, an independent digital ownership economy. Using their own name or company name, an entrepreneur like Elon Musk might issue a token called Elon . Then, fans could get @Elon tokens by participating in activities on any of Kanye’s platforms, doing other tasks that earn them tokens, or buying tokens from Elon Musk himself.
Anyone can create a social token. You can join the social token space and introduce a social token to your followers and customers, whether you’re an individual or a company. The holders of social tokens will receive a greater return on their investment as more people utilize the token.
Types Of Social Tokens
a. Personal Tokens:
Individuals can create tokens to monetize themselves and give their followers access to exclusive content and services. Tokens of personal worth can be made by anyone, from famous people to artists to athletes to regular people.
Example: French entrepreneur Alex Masmej sold tokens representing himself, called “ALEX,” to crypto investors. So, he was able to get enough money to start his own social platform in the United States. Also, people who own tokens will get a share of Masmej’s future profits for the next three years.
b. Community Tokens:
Community tokens, sometimes called “community money,” are created by communities to circulate as an incentive to join or support them. Like members of a club, those with tokens have access to special privileges. These perks are comparable to private tokens; you may even have voting rights and corporation shares in some cases.
The “decentralized autonomous organization” (DAO) is typically responsible for distributing community tokens. Community tokens are easier to sell than individual tokens since the community tokens’ creators already have a large fan base.
c. Participation Tokens:
People sometimes say that the tokens you get for participating in a community activity are a “sub-type” of community tokens. Users can obtain tokens like these for helping out with a project’s development. Institutions can use these tokens as incentives to get people involved in a wide range of projects.
Social Tokens Vs. NFTS
In the same way that NFTs use blockchain to create a distinct ownership model, so do social tokens. NFTs are used to monetize digital work, while social tokens would be better suited to monetizing the creator. While NFTs can commercialize digital commodities, social tokens can be used to monetize services or experiences.
Social tokens can serve various purposes. So, if a well-known individual were to create a token as part of a limited run, it would function the same as any other token.
On the other hand, the uniqueness of each NFT gives collectors a solid reason to keep their purchases. New Financial Transactions (NFTs) are a highly profitable business model for Web3 content creators. Using NFTs with social tokens would allow content creators to retain ownership over their work, brand, and platform.
Content creators will continue to rely on social tokens to monetize their work and share the value they generate with others, regardless of how we currently conceptualize personal wealth.
Benefits of Social Tokens to Businesses/Creators.
i) Tokens can be used as high-quality lead magnets.
If you have a social token or are considering making one, encouraging people to sign up for your newsletter in exchange for 5 or 10 tokens is a great way to expand your user base and your email list.
ii) Social media influencers have relied on sponsored content, paid promotions, and paid membership models to expand their follower bases. Since the social media site keeps a large portion of the profits, the creators get little to no financial gain from their work.
With social tokens, however, content creators may now earn and share rewards with their viewers.
iii) With the advent of social tokens, viewers have more opportunities to engage with their favorite creators and feel more invested in their success.
This mutually beneficial exchange benefits the community through a more tailored experience.
iv) Fans can demonstrate their loyalty to their favorite creator by holding a social token that symbolizes their interest in the creator’s ongoing success. This entity’s rising popularity and prominence will drive up the token’s price. ‘
Examples of Successful Social Tokens Launched
WHALE was released in 2020 and was developed by an anonymous NFT collector, WhaleShark. WhaleShark’s private NFT collection is the basis for the token’s value. It is one of the most popular social tokens because it achieves stable value and growth goals. In 2022, the collection’s estimated worth has skyrocketed to $73 million from its initial $500,000 estimate.
Steem’s native cryptocurrency, STEEM, is used exclusively on the Steem social network. The initiative aims to provide a structure for users to profit from the platform’s evolution. Anyone can participate as a stakeholder by publishing content and receiving STEEM in return.
As was already said, Alex Masmej, an aspiring entrepreneur, made ALEX, a social token, to fund his crypto-related projects.
He made the ALEX token so he could focus on a long-term project. He gave it to his fans in exchange for a share of his income over the next three years. Masmej raised $20,000 thanks to the sale in under a week. Because of the demand for the tokens, ALEX’s price soared to over $2 million.
How To Create Social Tokens
Creating social tokens with professional assistance is currently possible. That’s good news, considering how challenging it can be to design reliable social tokens.
Instead, you should use a token-minting platform like Rally.io to create your tokens.
Rally is a system that empowers groups to build NFTs and social tokens together. Rally gives creators and their audiences a novel means of communication and a fresh revenue opportunity.
Below’s a step-by-step guide from Roll’s creator playbook:
Set up your profile and apply to create a social token
Name your social token. You can name it after yourself or your community.
Make a launch plan. Announce your token launch on social media and get fans to purchase your token.
Keep building buzz by:
Giving out tokens to your most loyal fans.
Creating more community benefits for token holders (private Discord, etc.)
Adding your social token to an exchange so people can trade it with other tokens (e.g., ether).
When designing your social tokens, one of the first things you should remember is the need to plan strategically. Social tokens will forever be linked to your company or brand. You are putting your name on the line because it will become part of your legacy.
Social tokens are the best way to put a face to the trust economy. You need people to believe in your business and brand before they will invest in your tokens because they need to know that you will deliver on the promises you make to them when they join your community.
I'm Abimbola Abe, a content writer, and digital marketer. I've managed online communities and created content to assist businesses in transitioning to Web 3. I write about blockchain technologies, web3, and marketing. Linkedin Profile: https://www.linkedin.com/in/abeabimbola/
The views and opinions expressed in this article are solely those of the authors and do not reflect the views of Bitcoin Insider. Every investment and trading move involves risk - this is especially true for cryptocurrencies given their volatility. We strongly advise our readers to conduct their own research when making a decision.