Embarking on the journey of understanding social tokens? You're in the right place. We'll delve into the basics, demystifying this digital asset class, and provide a roadmap for beginners to navigate the intriguing world of social tokens.
What are social tokens?
Tokens issued by individual creators or communities that enable community members to collaborate and share ownership in the value created together
- Social tokens are a broad term that encompasses personal tokens, community tokens, and creator tokens
- Sometimes social tokens are associated with non-fungible tokens (NFTs), which exploded in popularity in 2021
- NFTs are unique assets that are represented as a token such as a digital art piece or a plot of virtual land, whereas social tokens can be used to represent access rights
Social Token Tools
There are a number of social token issuers that make it easy for creators and communities to mint their own tokens
- Social token communities can use governance tools like Snapshot and Tally so that token holders can vote on decisions within the group
- Risks
- Once a social token is issued and freely traded, it is subject to market fluctuations which can be heavily driven by speculation
- Ways to alleviate this issue include making tokens non-transferable in the early stages, as the community is forming, and introducing long vesting schedules to ensure that community members are long-term aligned
Friends with Benefits (FWB):
A community of Web3 artists, operators, and thinkers
- Token holders gain access to exclusive membership channels, NFT airdrops, and networking opportunities
- Whale: backed by high-value NFTs that include digital art, blockchain gaming, virtual real estate, etc.
Bankless
DAO, FWB, Forefront, and many other communities have introduced the concept of “seasons”
