The creator economy is going to be transformed in a web3 world, which will happen when blockchain technology gives creators a more direct relationship with their fans and creates new methods of monetization for content.
“Creators” is a broad category that includes social media influencers, celebrities, online gamers and anyone who creates something that other people can access. With the internet, the number of people that an individual can reach anywhere in the world grew dramatically, making it possible for creators to make an income that can range from thousands to hundreds of thousands, or millions of dollars. Creators are the foundation of the creator economy.
On web2, monetization of content came from advertisement and sponsorship deals signed by the creator with companies. Revenue sharing meant creators were given a portion of profits that large corporations, such as YouTube and TikTok, made on content uploaded to their platforms.
On web3, this revenue sharing model may become one of the multiple channels that creators have to monetize their content. Creators will be able to monetize their content through direct sales to users, a method that works for both web2 (ex. ecommerce, subscriptions, contributions using fiat currency) and web3 (ex. NFT sales, token-gated content access, contributions through cryptocurrency).
Social tokens, also known as creator coins, is one way to monetize content that is native to web3. These tokens give creators a way to automatically verify who is a true token holder because the blockchain can’t be hacked. Creators can mint their own tokens on the blockchain, which is backed by their reputation, brand and the strength of their fanbase. Creators can choose to hold a portion of their tokens themselves to gift them to fans as rewards. A portion of creators coins can be sold to fans or the general public to generate immediate profit. The holders of these coins can sell the creator coins they have or hold onto them to access special perks or rewards, depending on the utility that has been built into the creator coin. The value of creator coins depends on their supply and demand, where demand is driven by the creator’s popularity. Creator coins allow a creator to create their own economy built around their fanbase, and the coin’s value depends on the content of that creator.
Web3 and blockchain technology will put more power back in the hands of creators. Unlike in web2, where power and control are concentrated in the hands of large corporations, the creator economy in a web3-powered internet will put creators at the centre. When they create something on web3, individuals can now establish definitive ownership of that content through the use of blockchain technology. The more a creator produces, the more they own and the more content they have to monetize without needing to give up a percentage to a third party middleman.
Unlike a salary that you earn from being employed, which stops the moment you stop working for that employer, earnings from the creator economy can continue long after the content was first released by its creator. Music, videos and online games are examples of content that can be used and purchased repeatedly and by different consumers. This generates an income stream that’s independent on one employer or company for creators. By using blockchain technology to take out the middleman in this transaction between creators and consumers, all the profit is given to the creator.