You’ve likely been hearing about the “creator economy” a lot lately.
It used to be “influencers” and “thought leaders.”
And before that, they just called us bloggers, podcasters, and YouTubers.
In other words, it’s people who build an audience to build a digital business. And that’s what we’re all about around here.
You may prefer the term “content entrepreneur.” (I do.)
But it looks like the term “creator” may stick for the type of audience-first businesses we build. And while the mainstream media likes to treat it as something new, it’s been developing over the last 15 years (at least).
While “creators” build audiences, the popular conception is that it’s on social media platforms exclusively. That makes them reliant on advertising revenue and beholden to the platforms themselves.
We’re smart enough to not put ourselves in that position. While the emergence of “creator coins” may be a lifeline to those who rely on social media exclusively, they also have benefits for those of us who create products, services, events, and affiliate offers.
What Exactly Are Creator Coins?
Creator coins are a custom-branded form of digital currency. Effectively, this means you can create your own cryptocurrency and develop a virtual economy around your digital business.
Why would you want to do this? Well, for very good reasons that you may not immediately realize.
Here are three main ways creator coins are used by those who make them:
- Spend: Your audience members buy and transfer coins to you directly in the form of a tip or donation. Or your community uses your coins to purchase a product, service, or event ticket.
- Hold: Like other forms of cryptocurrency, people can hold your coins as a digital asset that has the intrinsic benefit of gaining them access to products, services, events, coaching, and consulting according to criteria you establish.
- Earn: Your audience members and fans can earn your coins in exchange for referrals and repeat purchases. You can also do coin giveaways to those who hold a certain amount of coin, or for any other reason you think is appropriate.
At the most familiar level, a creator coin can be used as a reward for your audience and loyal customers, much like airline miles or credit card points. Combined with referral-tracking software like Sparkloop (disclosure: I’m an investor), you can award coins to people who send you new email subscribers, and they, in turn, can use those coins for merchandise, access to special bonuses or events, and product discounts.
A creator coin is also a way for your fans to simply support you for the free value you provide with content. And that’s where the “spend” option comes in as a tip or form of patronage where coins are purchased and sent back to you. Eventually, you can charge for all sorts of valuable stuff with your currency, which brings it back home to you without being sold to a third-party.
Know When to Hold ‘Em
Let’s focus on the “hold” option for a bit. Because this is the approach to creator coins that brings the most benefit to both creators and their audiences, yet it may not be immediately apparent.
Let’s say you create a coin and launch it with 100,000 coins, 50,000 of which you reserve for yourself. When people buy the coin, it’s just like Bitcoin, Ethereum, or any number of other cryptocurrencies — the value of the coin in USD (for example) goes up. Of course, when people sell the coin in large quantities, the value in USD goes down.
So, your strategy may not be to get people to simply spend or earn your coin (at least not initially). You want people to buy and hold your currency so that your coin reserve goes up in value. That also means you have an incentive to offer access to products, services, and even you at relatively attractive rates for people who buy and hold your coin.
- If you’re currently a freelancer, you could offer meaningful discounts to clients who hold your coin.
- Content entrepreneurs can do the same with digital products, membership communities, and events.
- And you could even award coins as a bonus to people who make affiliate purchases from your offers, which gives you a customer relationship you wouldn’t have had otherwise.
The idea is that as a coin grows in value, creators can slowly take some of the proceeds out of their personal economies as a form of “salary.” And that can add up to more than simply charging in cash.
It’s even possible to generate that salary without selling any of your reserve coins. This allows you to hold on to your coin stash (equity) as your business grows and the value of your coin grows along with it.
More on that in a bit.
How Do You Create Your Coin?
If you’re wondering how you’re supposed to create your own cryptocurrency, well, it’s easier than you think. That’s thanks to Rally, a company founded by serial tech entrepreneur Kevin Chou that launched the first creator coin platform in July 2020.
Rally is an open network that enables creators to launch creator coins tied to their digital communities. Each coin is based on the underlying $RLY coin and is powered by Ethereum.
The Rally infrastructure is a sidechain to the main Ethereum blockchain and offers ERC-20 tokens that can be converted to Ethereum, and then to other forms of currency.
And by “other forms of currency,” I mean like United States Dollars or Euros. And you as a creator start off with a reserve of 50,000 coins … so you’re motivated to offer great value to your people so that the value of each of those coins increases.
$RLY is traded on the Coinbase platform, the largest cryptocurrency exchange in the United States and a publicly traded company. This was a recent development that signaled a significant step forward for the Rally platform.
That means you can cash out of $RLY just like you would Bitcoin ($BTC) or Ether ($ETH). And this brings us back to the topic of a “creator salary” from having your own coin. Under the Rally program, both creators and the holders of their coins receive $RLY as a reward for coin transaction activity.
So, how much $RLY can you earn as a creator with a coin? One audience-first entrepreneur confided to me that their coin reserve has a current value of one million USD, and they had earned $RLY rewards amounting to $200,000 USD — just since March of 2021.
Amazing right? But just as with NFTs, it’s those with existing audiences that benefit from creator coins. And unless you’re only asking for donations, you have to figure out what to offer your audience that has value to them. But that’s what we do when we charge old-fashioned money as well.
It’s All About Community
We want to use digital media not as mere marketing, but instead to lead movements that develop into tight-knit communities. When you take that approach, a creator coin can be an amazing way to simultaneously both deliver and gain value.
“Creator coin feels like the wrong name,” says Gregarious Narain, an entrepreneur with a Rally creator coin. “I think of them as community coins.”
Gregarious nails it. And that means the audience-first approach just got a whole lot more interesting — as if it needed more spice.
If you’re not there yet with an audience of your own, you have even more incentive to begin. Creator coins are just getting started, but it’s not something that you’ll miss out on.
That’s because a branded coin can work for anyone who offers something of value to people who are willing to hold your coin. If you develop products or services that you charge money for, you can decide to go the creator coin route at that time.
Put another way, businesses launch reward programs all the time, and they’ve been around for decades. But we’re doing it with cryptocurrency, and the new angles this introduces are powerful and fascinating.
Plus, there’s value to your customers and clients that transcends simply buying stuff from you with cash. If someone purchases and holds — say — 20 of your creator coins to get your digital product, they haven’t lost those coins.
In that scenario, the coins are not spent. But the transaction has still delivered value to both you and them.
The coins stay in that person’s portfolio and can increase in value as your community grows. Those coins can be sold, traded for other creators’ coins, or eventually returned to you for some other offer.
In this sense, you’ve got a classic win-win. Your fans can support your business via purchases of creator coins and get a better deal in the process due to the unique nature of you having your own currency.
It may sound a little crazy, but I’ve spent the last six weeks researching creator coins, and it definitely works this way for the people who have launched them so far.
Creator Coin Rules and Limitations (They’re a Good Thing)
As you might imagine, creating your own personal economy with a creator coin has to have some legal and technical limitations in place. And that’s a good thing.
Rally founder Kevin Chou knows people have been scammed in cryptocurrency startups and projects, so he doesn’t want the same to happen here. Rally educates creators so they don’t run into any regulatory problems with the coins.
“We’ve done a lot of work on the regulatory front and on a compliance front,” Chou said. “We are focused on providing utility. We are making sure that this is something that the creators are using themselves. We’re not hiring a celebrity to say, ‘go buy this token.’ This is not that. This is us providing a toolkit. It’s a little like WordPress for creating web pages — we give it to the creator, and they use it for cool things.”
So, let’s cover what you need to know about how you can talk about your creator coins. We’ll also look at the process for incrementally cashing out of your coin if you so choose.
What Creator Coins Are Not
Creator coins are not intended to be securities or investments — those terms imply a passive token that has no value other than potential appreciation in price. So this is not Bitcoin (to echo a common criticism of that coin).
Creator coins are different because they have immediate and intrinsic value. In other words, holding your coins provides your audience or community with exclusive access to you and your products, services, and events.
That means you don’t want to focus on the price of your creator coin or discuss price appreciation as the goal or the key indicator of success. Instead, refocus the discussion around the benefits of being a coin holder, including perks, access, and Rally rewards.
With that perspective, the only time to talk about your coin price is when you first launch. This has an immediate effect on that intrinsic value.
Most people understand that when a cryptocurrency is brand new, that’s likely the lowest it will ever cost in USD because as soon as people begin buying it, the price from zero can only go up. So that is directly relevant to how much value your offers have relative to what your people pay in “real” money.
Beyond that, you don’t want to attract speculators to your coin. There are definitely people who watch for new creator coins and then “pump and dump” for a quick profit. That’s not what you want, and you should let that clear out before doing a hard launch.
The true value to your audience is in holding or spending the coin to not only support your business, but to gain valuable access for a relative bargain. Or even to perks that money can’t usually buy.
Rally’s Rules and Rewards
Speaking of pump and dump, there are rules at Rally that prevent a creator from launching a coin and then immediately selling their reserve coins for a quick profit. Creators can only sell a small percentage of the total supply of their coin as an “allowance.”
You can earn more allowance over time based on how much your community members buy, sell, and transfer your coins. It’s somewhat similar to a stock vesting period. The idea for a creator is to be in in for the long term appreciation of coin equity.
But don’t forget about Rally Rewards. These are valuable coins you (and your coin community) are earning above and beyond the reserve of your own branded currency, and these are what you would transfer for cash to pay yourself a salary.
You don’t have to sell your $RLY, of course. Several creators I’ve spoken with said they are reinvesting their Rally Rewards into buying more of their own coin or the coins of others.
That’s a great indication of how much the early coin creators believe in the entire personal economy concept. And now, so do I.
Introducing the $MOVE Coin
I research a lot of things to write about them. But in this case, my research into creator coins was first dedicated to creating a coin of our own.
I’ve decided to consolidate my non-Copyblogger sites (Future Freedom, Unemployable, and Further) under a new brand — Movement Ventures. Jerod Morris and Trudi Roth are joining me as principals in this new company.
We’ve created the $MOVE coin through Rally to experiment with a new approach to our business. As someone who sold $70 million worth of software, training, and memberships in a decade — all for cold hard cash — this is a major shift in thinking.
In other words, I’m charging my coin-holding customers and prospects less, but hopefully still building an even more viable business. Like I said, a win-win for everyone.
And we agree with Gregarious Narain on community versus creator coins. While we create things that hopefully add value to your life, without you in our community there’s nothing happening. So we’re going to refer to $MOVE as a community coin — and we also reinvest our Rally Rewards for the good of our community.
I’d like to invite you along for this unique journey. We’re planning new events, coaching programs, and even one-on-one consulting for those who hold our coins.
You’ll get big discounts, and in some cases, completely free access.
For starters, we’ll share everything we learn about creator coins with you as a $MOVE coin holder — the good, the bad, and everything in between. You’ll have an insider understanding of how you can create and benefit from a creator coin of your own, all while benefiting from $MOVE ownership.
And remember, $RLY rewards are distributed to $MOVE holders in proportion to their balance, and those coins can be spent or traded for cash as you see fit. This is so far the most unexpected and fascinating aspect of the concept.
Here’s how to get started:
- For only $15 (less than the price of a hardcover business book) you can join The Coin Collective. You’ll need to create a Rally account first and then simply buy and hold a small amount of $MOVE to join the group. We also offer product discounts and weekly giveaways of more $MOVE coins to members.
- To see how creator coins and your personal economy fit into the larger strategic picture, take our free personal enterprise course over at Future Freedom.
Hope to see you soon!