tldr;

Coins today are purely speculative and lack real incentives for holders, leading to rapid price declines post-launch. Revenue coins offer a narrative-flip by tying token value to real product, service, or business revenue, giving sustainable incentives to holders. In the article, I introduce the concept of Revenue Coins as a bear-market-proof path forward.

"Do you know the only thing that gives me pleasure? It's to see my dividends coming in."

- John D. Rockefeller

I'm tired. I'm tired of slop. I'm tired of crime. I'm tired of schemes. I'm tired of metas. There's a new one floating around: Product Coins. "These aren’t just speculative memes; they’re backed by real products!" Sounds good on paper. But here’s the reality: product coins that are not tied to a product's impact will die too.

Today I'm proposing a new terminology, Revenue Coins, and a call to action on the community for further experimentation in this space.

In 2024, MustStopMurad dropped a now-viral clip from Token 2049, racking up 8.3 million views. The core idea? Token is the product. That the only thing that's working in crypto is the ability to launch a token that can be traded instantly. Murad highlights memecoin communities as the narrative of this bull run. And yeah, if you squint hard enough, it kinda makes sense. Memecoins don’t need anything beyond a strong community and good vibes. A strong community spreads good vibes wide and far, getting new holders in to continue bringing the price up.

👀 But also...

Ponzi Scheme: A Ponzi scheme is an investment fraud that pays existing investors with funds collected from new investors.

- Investor.gov

Fast-forward to February 2025, and now there are products that facilitate the trading of coins to the extreme. Products like vector.fun are designed to make you feel like you're at an Instagram-style casino, able to copy trade in two taps or less:

bry on Warpcast

The casino of crypto 🎰 In the vector.fun app, you can turn on demon mode and watch pump fun launches that are about to graduate. You can buy any token from this screen in 2 taps, under 2 seconds. I’ve spent the last 30 minutes studying this screen and watching which tokens graduate pump.fun … baffling. 🤯 https://imagedelivery.net/BXluQx4ige9GuW0Ia56BHw/bcb709b0-dd92-45e9-4e67-61d3827d1600/original

Farcaster

Just like trading products, there are now hundreds of token-launching products akin to pump.fun. If you're unfamiliar, pump.fun is the go-to token launcher on Solana that lets anyone with a ticker name, token name, and image launch a token for free.

An influx of trading-related, token-launching products coming out of meme mania has reminded some of us who have been in crypto for 8+ years of the 2017 ICO season. In 2017, we saw new blockchains, new apps, new visions of a decentralized future. Whereas in 2025, "devs" drop coins and then a roadmap, in 2017 "devs" would drop a "whitepaper," have a "presale," and you'd get rekt almost immediately. I participated in a few ICOs in 2017 - almost all are dead now.

"Believe in Something"

- Crypto Twitter Anons

One of my least favorite phrases I see alllllll the time on my timeline is "Believe in Something." Belief is nice and the phrase is optimistic, but belief can financially destroy you. The trend of the majority of coins is an immediate run-up post-launch (belief) followed by a deep 50%+ drop (destruction).

So what should we actually believe in? The ability to generate and share real value. In order to incentivize long-term token holding (investing) vs. selling post-launch, there must be incentives for the holder.

Enter Revenue Coins.

Revenue coins represent a shift towards sustainability in crypto - they offer real economic incentives for holders - not just creators.

Imagine you run a local coffee shop with a reward token $BEAN. Every coffee transaction incurs a 5% additional fee, which is collected and distributed to $BEAN holders regularly - similar to dividends.

Why does this work?

1. Real Business: A coffee shop generates tangible revenue with real-world demand.

2. Value In: People buy coffee with fiat, a portion of which is distributed to holders.

3. Sustainable Demand: Unlike speculative memecoins, revenue-generating businesses sustain demand through actual usage.

Before we start launching revenue coins left and right, there are certain requirements of revenue coins that are necessary to define. The following are just the tip of the iceberg:

1. Revenue Generation: If your product or service doesn't generate revenue, there is no sustainable way to inject capital into the model.

2. Fee Collection & Distribution Mechanisms: Smart contracts must reliably collect, convert, and distribute earnings to holders.

3. Transparency: If revenue distribution is discretionary, token holders should have visibility and potentially some level of control over allocations.

4. Regulatory Clarity: Governments still need to define how these coins are classified (security vs. commodity) and regulate + support accordingly. (See next section)

The largest blocker to considering revenue coins has been government regulation. Since the inception of crypto, governmental administrations lacked clarity on rules and regulations, specifically around the classification of coins as securities vs. commodities.

Quick refresher:

Security: A financial instrument that represents ownership in an entity and offers an expectation of profit derived from the efforts of others (e.g., stocks, bonds).

Commodity: A basic good that is interchangeable with others of the same type (e.g., gold, oil, Bitcoin).

The classification of revenue-generating coins as securities vs. commodities is crucial because it determines their regulatory treatment, including taxation, compliance requirements, and legal obligations.

Ultimately, the lack of regulation clarity creates uncertainty for builders and investors, making it difficult to determine whether revenue-sharing coins are legally viable or whether they might later be subject to enforcement actions. The outcome of this debate will significantly impact the future of Revenue Coins as a sustainable model in crypto.

The incentives to hold non-major coins are rapidly declining. Holding any longer than a few months is becoming a losing game.

Revenue coins could define the next era of crypto, creating real value instead of speculative hype. If a business generates revenue, and that revenue gets shared with holders, holding a token becomes desirable. This model aligns incentives, rewarding holders for staying in the game rather than relying purely on speculative price action.

For this to happen, we need more experimentation, regulatory clarity, and sustainable models.

INTRODUCTION

I've been a $DEGEN holder and supporter since Day 1. I care deeply about this community and its direction. After listening to Jacek and Colton in a few X spaces and the DegenAnniversary livestream, I wanted to pull together my thoughts on a simple strategy for the future of $DEGEN.

The following document is totally open for discussion and could, once formalized, be used to motivate and steer the community towards action.

Summary of some things that are helpful to cover before diving into a proposed strategy:

• $DEGEN launched a year ago out of the fun, games, and experimentation in the /degen channel in Farcaster.

• $DEGEN was distributed to Farcaster users based on their participation within Farcaster, creating strong alignment between its growth and the broader success of the ecosystem.

• $DEGEN exhibited signs of product-market fit with tipping (farmers-aside). Its frictionless tipping system has become an integral part of the Farcaster experience, allowing users to reward each other seamlessly without feeling like they are spending their own money.

• $DEGEN Layer 3 showed signs of life, but after being down for several days in May 2024, builders and users lost trust and withdrew funds. Now, Jacek and Colton have been working on providing proper tooling to restore trust in builders and degens alike.

• Products that expand outside of the Farcaster ecosystem (e.g., X) can gain broader public attention and adoption (e.g., $BANKR).

• Coinbase Wallet will soon begin ingesting Farcaster data, including frames, creating a new intersection between social and financial interactions.

To build on $DEGEN’s momentum, I outline four key pillars, each with clear objectives, actions, and KPIs.

Experiment and incubate $DEGEN related products within Farcaster & Degen L3

• Objective: Use Farcaster as a sandbox for experimentation, creating new $DEGEN experiences, products, and more.

• Context: Farcaster remains the best testing ground due to its highly engaged, crypto-native user base and recent integrations with major wallets.

• Actions: Organize builders to build on $DEGEN and develop content-based and Vegas-style ideas such as token-gated content, v2 frame experiences, and more.

• KPI: Number of active $DEGEN builders, engagement of $DEGEN products.

Expand features that show signs of product market fit to other platforms and communities.

• Objective: Scale and decentralize successful $DEGEN-based products beyond Farcaster to platforms like X, Reddit, and TikTok.

• Context: Products that have shown signs of product-market fit (e.g., tipping) could a) expand to other platforms (X, Reddit, etc.), reaching a broader audience & b) be decentralized to allow other communities to use these features

• Actions:

  • Launch MVPs of PMF features (social tipping, raindrops(?)) on X, Reddit, and other platforms.

  • Decentralize PMF features (social tipping) so that other communities could leverage them

• KPI: Engagement rates across platforms, community feature adoption.

• Note: $DEGEN could still be Farcaster-first, offering multipliers for using Farcaster over X or other platforms.

• Objective: Strengthen the $DEGEN community by fostering organic growth

• Context: Community engagement is the backbone of $DEGEN. Sustained growth requires both retaining existing members and onboarding new ones in fun and rewarding ways.

• Actions:

  • Continue exploring ways to leverage new Farcaster features (e.g. wallet) to distribute $DEGEN

  • Continue to build awareness and a home for the $DEGEN community through $DEGEN aligned experiences

• KPI: Growth & retention of $DEGEN-holding wallets

$DEGEN is uniquely positioned to be the leader in decentralized social experimentation and can continue to push the boundaries of decentralized social engagement.

This strategy simplifies the path forward by focusing on experimentation, decentralization, and community-driven growth, ensuring that the $DEGEN community has a clear roadmap to build, expand, and thrive. By executing this approach, we not only reinforce $DEGEN’s role within Farcaster but also position it for success in the broader decentralized social economy.