The value of Likes on the creation of social economies
On social networks, such as Facebook, Instagram or Twitter, there is a value that is transferred between users called “Like”. Whether it is a picture of your dog wearing a Jedi disguise, a haiku poem about autumn or a short video of a teenager Rihanna-wannabe singing in front of her cellphone, for every contribution to the community Likes are expected as a retribution, as a recognition for a good job. And they become an incentive for creating new content. But as there is an unlimited supply of Likes — no one ever ran out of them — Likes have no actual value.
In order to bring out value of “Likes”, they should have two attributes: demand and scarcity. Well, there is a demand as every single minute 4 million likes are being clicked just on Facebook, and every time someone clicks on “Like” button, a “Like” is issued and spent. This unlimited issuance of “Likes” goes against scarcity, therefore it threatens its valuation. Nobody is saving its “Likes” for the winter season…
Having no value, social media users give away “Likes” to very low quality content, encouraging more users to upload more crap.
Tokenization is nowadays one of the most powerful use of Blockchain, the technology behind Bitcoin and every other cryptocurrency out there. To tokenize is to turn something into a digital representation of it (Likes already are), and build up an ecosystem where it could be tradable (they are not) The issuance of tokens can be preset on a smart contract and audited by anyone, as Blockchain is a transparent and public registry.
What if we can create scarcity value on Likes by turning them into a freely transferable, tradable token with a limited issuance? What would happen if, to set an hypothetical scenario, we transformed Likes into Likecoins?
A token such as Likecoin changes the game of social interactions, turning social networks into social economies .
On one hand you would have to think twice before handing out your tokens in exchange of low quality contributions, because your stock of Likecoin is limited. On the other hand, you would be able to give away as many Likecoins as you wish on a certain content that you´ve really enjoyed. You could earn your Likecoins back, but this would mean that you should have actually contributed to the social network.
Get involved, participate, be active. There would be no more witnesses. A secondary market of Likecoins would be probably built up, and users who wanted to get tokens without participating, would need to buy them, giving a monetary value to Likecoin. Anyone would send and receive Likecoins from friends, making a good present out of it. A treasurable gift.
Then, this girl that has got 30,000 likes on her last picture on Instagram would be automatically earning some bucks as an incentive for creating new quality content.
Retweeting or sharing would make you a business partner as you might help a piece of content reaching new audiences and earning more Likecoins. The contributors (or authors) of that content should choose what percentage of those Likecoins would be shared with the network — the more their decided to share, the more distributors their content would find —
Instead of a retribute-if-you-enjoyed model, certain content could require a pre-settlement of Likecoins in order to be shown, just like premium content. I know you really want to watch this, so pay before you watch it.
Today, all social networks are turning to video as the dominant resource for engaging users on their platforms. Facebook is about to spend $300M to produce its own content, Warner is planning a $100M budget for creating original videos for Snapchat. Around 70% of internet traffic is video, and this number is increasing to reach more than 80% on 2020. Traditional video platforms rely upon huge costs on storage and bandwidth. Within this context, only a few big players can compete against the supremacy of YouTube and Netflix.
By using a token such as Likecoin users could be engaged in helping improve a decentralized video network by lending their storage space and their bandwidth in exchange of tokens. Spending Likecoins for consuming the content they really want to watch, and earning Likecoins back for making the network stronger. Whether it was a smartphone, a tablet or a desktop computer — even a smart tv — a video distribution community could smartly get use of any device connected to internet, turning it a part of a decentralized, incentivized peer-to-peer network that has no structural costs and unlimited scaling possibilities.