Social tokens are forming a new social graph through which people can build connections with communities, make friends, and exchange ideas.
Extended reading: ” An article to understand the most potential social token application “
Written by: Shreyas Hariharan, founder of Llama, former investment analyst of Duke Management Company Compiler: Perry Wang
Our time has experienced the explosive expansion of online communities. Social tokens add a “money layer” to these communities, which can help distribute ownership, improve governance, reward active contributors, and more. I personally like an analogy: participating in a social token community feels like running a university club that can be expanded to a national scale.
Social tokens are encrypted tokens issued by individuals or communities, representing ownership and the value provided by creators and communities. Social tokens are usually ERC-20 tokens issued on Ethereum, which can be used to access group chats, content, products and income that require permission, and can be used to bet on the potential of creators or communities. They serve as a badge or social proof to prove that you are a “true believer” in the community.
The famous author Nadia Eghbal, who has been promoting the development of the open source community, once asked on Twitter: How can top creators establish fairness, not just salary? In fact, social tokens can help creators and communities build fairness. You can’t build a billion-dollar newsletter business, but you can build a billion-dollar newsletter community.
Many social tokens were originally personal or creator tokens, based on the personal reputation of the issuer. They help creators build relationships with their communities and capture some value from this relationship. But some of these tokens transition to community tokens, and most of the value comes from the creator’s community. They help creators’ community members build relationships with each other and make full use of the untapped social capital built into the group.
JAMM: Encryption native experiment using tokenized community tools
JAMM is a social token that helps to encrypt a group of aboriginal people in the vast crowds of crypto signals. Brian Flynn, former product manager of Dapper Labs, issued JAMM, which was originally a pass for representatives to visit his newsletter and Telegram chat group (now Discord).
Early buyers of JAMM bought it because of Brian Flynn’s reputation, work and social connections. But he wants to realize the decentralization of the community, reduce the dependence of tokens on him, and distribute JAMM to active community members. Therefore, in addition to keeping 1,000 JAMMs for his personal access to newsletters and chat groups, he allocates all other tokens to the community vault. There are currently about 4 million JAMM tokens in a multi-signature wallet. Six Jamm members must be signed to approve any spending in this wallet.
I personally assisted in the management of JAMM’s vault, and I was also excited to see how the social token community explored the framework for managing community banks. Some of the important issues include:
- How to decide how much to spend each year? What should be spent on?
- How to ensure that contributors in the appropriate category get more JAMM?
- How to make the vault get capital inflow?
- In addition to JAMM, how to diversify treasury assets?
- How to provide incentives to increase the liquidity of the token in the Uniswap protocol?
Initially, the members of Jamm worried that if Brian only kept 1,000 JAMMs, he would not be sufficiently motivated to donate all the tokens. We agree that he can exercise his rights to get 15% of the token supply after 2 years. Like other core contributors, he will get 10,000 JAMM per month, and after two years he will exercise the right to get 1.26 million JAMM. At the end of each month, the community will vote to determine the salary of core contributors (including Brian) in order to decide to change the salary as needed.
JAMM now represents a community of encrypted natives who are experimenting with tokenized community tools to pave the way for a new type of creator economy. Brian is an important contributor, but the goal of JAMM value-adding increasingly represents (1) the content and products created by community members, (2) the value of the community as a builder and early adopter of various crypto projects, And (3) the value of community funding and governance.
WHALE: Social token supported by NFT assets, brand, community and industry leadership
Calculated by market value (20 million USD), community size (Discord chat group more than 1,000 members) and community interaction, WHALE is currently the most successful social token.
WHALE originally came out as a token backed by tangible assets. One dimension of token value comes from its NFT, such as the NFT of the token Whale digital art and collectibles.
In addition to the NFT library, WhaleShark also talked about four other factors that drive the value of WHALE: WHALE’s brand, community size and participation, industry leadership brought by the age of community NFT expertise, and various ROI mechanisms. He has remained anonymous so far, ensuring excellent operational safety.
Many tools enable creators to establish direct relationships with fans. Whale has created a great model to connect the creators’ fans with each other. The Whale community shows to some extent what the transition from a passion economy to a Discord fan base economy will look like. Some people spend most of their time in Whale’s Discord chat community every day. They find ways to make friends, have fun, and make money. Through CCTip, members use WHALE to reward each other. They are holding karaoke contests, selling artworks, organizing poker nights, and constantly launching new projects. I recently joined a Lianmai live broadcast, in which WhaleShark introduced a cool 3D sneaker library. We will see more creators’ fans/followers establish direct relationships and share some social and economic benefits.
KERMAN: Betting on Kerman Kohli’s potential
KERMAN is a classic personal token experiment. By holding KERMAN tokens, you can get a share of the future development of Kerman Kohli . He writes articles about DeFi and shoots related videos. He created ARCx , in which bonds can be issued with any token as collateral; in other words, “a decentralized organization DAO that can do anything”. When Kerman launched ARCx, he announced that 1% of the supply of his token ARC would be divided among KERMAN token holders.
KERMAN is a way to support promising cryptocurrency entrepreneurs. By holding KERMAN tokens, you can exchange economic benefits from projects that Kerman himself will start later. Kerman’s Telegram group is currently largely inactive. He is currently focusing on creating economic value for KERMAN holders rather than ensuring community participation. Although I can prove that it is actually very easy for the KERMAN holder to chat with him privately.
The development direction of social tokens
We will see that a social network will be built on top of existing social tokens. Tokens are a new social graph. Makoto created a sample social token graph. The figure below shows the overlap of social token holdings between different addresses. What would happen if this diagram could be used to build connections between people and communities, make friends and exchange ideas.
Overlapping diagram of Makoto’s social token holdings
We will begin to see successful social tokens being accepted as loan collateral. For example, in the NFT community, you can see that WHALE is accepted as collateral for lending DAI or other stable coins.
We will see guilds or associations formed by bringing together multiple social token communities. Third-party groups that want to market or sell to guilds will provide discounts and benefits in exchange for customer acquisition opportunities.
We will see more ways to allocate tokens to followers or subscribers. RAC distributes tokens to fans who support him on Patreon, Twitch and Bandcamp, as well as fans who have purchased RAC products in the past. Maybe you can distribute tokens to all current followers of Twitter, and distribute a certain token to followers proportionally based on your interaction (like/comment/forward). Unite is an interesting product used to distribute tokens to reward social media engagement.
The field of social tokens can develop in many ways. If you have any thoughts, feedback or questions, please contact me on Twitter.
Thanks to Louis Albert, Arjun Balaji, Alex Conway, Eric Ruleman, and Daniel Schlabach for reading the first draft of this article.
