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What is Tokenized Subscription?
With the rise of NFTs & tokens last year, Tokenized Subscription is the new monetization model for creators uniquely enabled by the nature of Web3
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With the rise of NFTs & tokens last year, Tokenized Subscription is the new monetization model for creators uniquely enabled by the nature of Web3
Thread
🧵👇
Put simply, instead of paying a subscription, customers get access to the subscription by holding tokens.
As long as the tokens are held, access to services is granted.
A tokenized subscription enables new incentives for creators.
As long as the tokens are held, access to services is granted.
A tokenized subscription enables new incentives for creators.
The past decade was the decade of the traditional subscription economy.
We saw evolution across various sectors.
@Netflix, @Spotify, @Adobe, etc
More access and less upfront cost for the customer
Stable, recurring revenue for the business.
We saw evolution across various sectors.
@Netflix, @Spotify, @Adobe, etc
More access and less upfront cost for the customer
Stable, recurring revenue for the business.
But for creators, trying to create a subscription service was hard.
For one, the landscape is really competitive.
People are used to free services and content.
This makes it hard for creators to get their content noticed, much less monetized.
For one, the landscape is really competitive.
People are used to free services and content.
This makes it hard for creators to get their content noticed, much less monetized.
Here's how tokenizing subscriptions can help both creators and customers.
1. Tokenizing subscriptions allows for the bootstrapping of new networks.
While this issue is less important for larger software companies, content creators have always struggled to scale their audiences.
While this issue is less important for larger software companies, content creators have always struggled to scale their audiences.
2. With a tokenized subscription, creators are able to instead focus on creating content.
Starting a community becomes less costly as tokens incentives help convert early adopters into "Angel Audiences", which are most likely to be other creators.
Starting a community becomes less costly as tokens incentives help convert early adopters into "Angel Audiences", which are most likely to be other creators.
3. Tokens solve the issue of churn when customers stop subscribing.
It enables customers to benefit financially as you grow and enjoy the success of the subscription service.
It incentivizes early adopters to become evangelists of the project.
It enables customers to benefit financially as you grow and enjoy the success of the subscription service.
It incentivizes early adopters to become evangelists of the project.
4. Tokenizing subscription also allows customers to have more flexibility over their access.
Unlike traditional SaaS, you will not be locked in.
Instead, once you are done with the service, sell off the access tokens and recoup on the initial investment.
Unlike traditional SaaS, you will not be locked in.
Instead, once you are done with the service, sell off the access tokens and recoup on the initial investment.
In the instance of a tokenized subscription model, recurring revenue would come from gas fees.
This is similar to Inflation-Based Revenue.
This is similar to Inflation-Based Revenue.
To explain a bit about Inflation-Based Revenue, let's take a look at traditional inflation.
When governments print money, it causes inflation.
The overall supply of currency is increased.
Individual currency's purchasing power is decreased.
When governments print money, it causes inflation.
The overall supply of currency is increased.
Individual currency's purchasing power is decreased.
Likewise, tokens are also subjected to inflation.
Newly minted tokens are constantly being circulated into the overall supply.
By holding Tokens, you pay a subscription of inflation to secure your tokens.
This would be the subscription "fee" in tokenized subscriptions.
Newly minted tokens are constantly being circulated into the overall supply.
By holding Tokens, you pay a subscription of inflation to secure your tokens.
This would be the subscription "fee" in tokenized subscriptions.
Going back to tokenized access, let's discuss some services that can be token-gated.
Below are some examples of token gating currently happening:
Below are some examples of token gating currently happening:
1. eCommerce Store Builders
E-commerce store builders are a dime a dozen, most of them working via a subscription model.
@mintgate_io is currently creating a No-code store builder for web3 that allows for others to also token gate web content (websites, videos, music, etc)
E-commerce store builders are a dime a dozen, most of them working via a subscription model.
@mintgate_io is currently creating a No-code store builder for web3 that allows for others to also token gate web content (websites, videos, music, etc)
2. Saas Products (Finance tools)
@Astro_Tools is currently utilizing a token-based model very reminiscent of traditional subscriptions tiers.
The user's tier is based on the number of tokens held, with more tokens coffering more advanced features access.
@Astro_Tools is currently utilizing a token-based model very reminiscent of traditional subscriptions tiers.
The user's tier is based on the number of tokens held, with more tokens coffering more advanced features access.
3. Online Learning
With over 222 Billion USD in market value in 2020, we'll most likely see more e-learning services, especially in subscription-based access.
@collegenft & @decentraliens are two of the many players experimenting with using tokens as access to content.
With over 222 Billion USD in market value in 2020, we'll most likely see more e-learning services, especially in subscription-based access.
@collegenft & @decentraliens are two of the many players experimenting with using tokens as access to content.
4. Online creator communities
@radicle is to be building a platform to enable solo creators to tokenize subscriptions for their communities.
@radicle is to be building a platform to enable solo creators to tokenize subscriptions for their communities.
5. Onlyfans style content
Instagram and Crypto Influencer @Irenezhao_ made waves across the web3 / crypto Twitter recently with @0xIreneDao and provocative NFTs.
She's now looking to launch @socol_io, a decentralized creator platform aiming to be a web3 Onlyfans.
Instagram and Crypto Influencer @Irenezhao_ made waves across the web3 / crypto Twitter recently with @0xIreneDao and provocative NFTs.
She's now looking to launch @socol_io, a decentralized creator platform aiming to be a web3 Onlyfans.
To sum it up, tokenized digital products and services should allow for more flexible business models, and help align creators with their audiences.
We're still in the early days of web3, and I expect that we'll see a trend towards more product-focused web3 soon.
Exciting times
We're still in the early days of web3, and I expect that we'll see a trend towards more product-focused web3 soon.
Exciting times
Hopefully, this thread was helpful.
If you enjoyed the thread, follow @kazsatamai & @withmattkim & retweet the first thread.
If you enjoyed the thread, follow @kazsatamai & @withmattkim & retweet the first thread.
