In this article, I want to go over the most important parts of our token economic model. I will explain the rationale for how our system is designed to benefit the Yuser community.
If you are familiar with Yuser, these concepts will not be new to you. However, I will also introduce some of the back story which explains the research & development that went into making such a unique system of value creation while valuing creation.
Value Creation Process — from a like to a token
If you give a like to an Instagram (IG) post there is no inherent monetary value in that. Or is there?
If I have an IG post that has received 5 million likes (we can all dream ;) it clearly has generated a lot of value — especially if I’m able to earn that on a consistent basis. There are many people that would gladly pay me to “sponsor” my posts so that the content they want to get out there has a similar engagement. Many likes are therefore valuable.
Paying for exposure is a widely established concept within the marketing world. However, if my post has only gotten 5 likes no one will ever pay me for that. We can all inherently understand why this is the case. The company paying for the “exposure” would not pay for any if only 5 people liked the post that I shared. Or would they?
Let’s introduce the idea of “boosted (sponsored) posts” — to share posts outside of one’s own audience a typical path is to “boost” them. Essentially, to get them seen by more people one has to pay money to the company that runs the social networking platform — this can be done by individuals or companies. An unsuccessful sponsored post/ad could easily cost $20 and get 5 likes before it is further optimized for performance.
One of the most common metrics for online advertising is “pay-per-click.” When running a pay-per-click ad the advertising platform gets paid every time the ad is clicked on. In some systems, advertisers are even able to detect that someone paused on the ad (without clicking) and if it has been within view for more than 3 seconds that counts as an “ad viewed.” That also is exposure that needs to be paid for.
Now, what’s all of that got to do with Yuser?
We asked ourselves, if likes (clicks) are value-less, at least at a low volume — which is for the majority of people online — but ad clicks are paid for, then why shouldn’t all clicks online be valued? What would it take to convert likes to a system that accrues value for all its users from day one?
The short answer is: on Yuser app likes are tokens.
The long answer is laid out below.
How to encourage engagement while creating value?
At first, when designing the Gemnomics system it became very apparent that if we just offered tokens to people on the app they would collect them instead of giving them to each other.
To maintain high engagement, it was necessary to separate the tokens that people can give (gift) from the ones that they collect when gifted. That’s how the concept of Rocks and Gemstones was born.
Rocks are what you get from the app for engaging with it daily. You can only get up to 50k Rocks per day to gift to others. That is unless you are a NextGems (our NFT) holder. NextGems unlock your wallet and you get 1,000 extra Rocks each day for each NFT you hold.
Rocks only have value in that they allow you to engage with the content you like on the network. When you gift them, the process of giving attention to others changes them into Gemstones.
1 Rock = 1 Gemstone
Gemstones are similar to loyalty points in that you can spend them on various things within the app. It is important to note that Rocks and Gemstones are not crypto tokens. On Yuser, there are wallets that hold both, however, because Rocks/Gemstones are not on chain they are easier to interact with by web2 users. The “wallets” are created automatically, and they only partially resemble crypto wallets. This removes technical roadblocks for web2 users, teaching them about the concept of wallets, and interacting with tokens without giving them a responsibility to handle private keys, recovery phrases and having to do things like signing for transactions.
[It is worth noting that the actual crypto wallets that users have and will have access to in the future will be in the same place in the app.]
Additionally, because Rocks/Gemstones aren’t on chain, they can’t be taken out of the system, they can’t be traded, and they are not subject to KYC (know your customer) regulations.
There is no fixed supply for Rocks and Gemstones and even though there can be a potentially unlimited supply for both the maximum number of Rocks/Gemstones created each day is capped by
[Nb of Active Users x Engagement x (50,000 + NB of NFTs owned)]
Engagement on the app will range between 0% and 100%; when it is 100%, every user within the system gets the daily maximum reward of 50,000 Rocks + their NFT bonus if they own any. On the other side, for this to happen, all Rocks have to be gifted daily to others and become Gemstones.
What can I do with Gemstones?
- Hodl them in your wallet because you’re Gem Diamondhands
- Use them as payment when you submit your content to contests on Yuser (#challenges) to win crypto prizes (currently MOVR/GMLR)
- Pay for products — we piloted this function for Gemstones prior to COVID-19 and we will bring it back. Once we have advertisers wanting to advertise products to our users they will not be putting up ads on Yuser. The way to advertise on Yuser is to offer products for Gemstones (hence the loyalty point). All companies have budgets to give away products to their consumers as samples, offer discounts, coupons or add-ons. We believe a much more effective way to advertise is to reward your audience on social media than annoy them with ads.
- Stake — you can lock up your Gemstones to earn Diamonds. Diamonds are a rewards-based crypto token. We’re internally testing the Diamond distribution right now. If you start staking your Gemstones before our TGE you will be eligible to earn a single boost in Diamonds upon TGE. The Gemstones staking feature is still in active development. Stay tuned for Gemnomics article pt. 2 that will give more insight into Diamonds, the staking model, and Diamond distribution in more detail.
How to curb resulting spam / scammy practices?
Even social networks that don’t offer something of value to their users right away face the problem of liking circles, spam, fake accounts, plagiarism, and content that breaks community guidelines.
When you introduce something like Gemstones into the mix it becomes even more apparent. Users will go to lengths to fake engagement on their posts. As such, we have a strong obligation to make sure that those who get rewarded with tokens comply with our privacy policies and community guidelines.
You can expect more on this subject from us in our future articles on Gemnomics.
Mob mentality vs democracy
Throughout our journey at Yuser, we realized that one of the fundamental problems with social media is the same one that occurs across all types of networks — given the choice, many people will behave to the detriment of the network/community they are a part of. This occurs for multiple reasons:
- Lack of incentives
- Wrong incentives — the benefits of poor behavior outweigh the negative consequences
- Lack of clarity / understanding on the impact of their behavior
Blockchains are an amazing example of networks that have been designed to eliminate bad actors using game theory principles. However, what happens on the blockchain is very simple in comparison to the multitude of actions/decisions that can be taken across a social network. As a rule of thumb, the more choices, the harder it is to devise a system where participants’ personal incentives strategically align with the overall well-being of the network.
Let’s look at an example:
Ann finds an artist she likes online and she decides to share their work as her own on Yuser. She knows that this content is going to get her a lot of Gemstones. She knows it will be hard to find that she plagiarized this content because the artist’s work is only listed on their own website which is not in English. She tells Bob how to do the same. They start a gifting group to grow their accounts.
This behavior happens on every single social network that rewards engagement. Short term benefits of getting a lot of engagement outweigh the risks of being found out, getting your account deleted and ultimately stifling the growth of the network itself because of the negative impact this type of behavior has on its reputation.
There is a long journey ahead of us before we can ensure that all online content can be traced back to its original source contract. NFTs are a step in the right direction but even so, there is still nothing stopping a person from minting someone else’s content. Smart contracts might be smart but they are not able to identify plagiarized content.
Ultimately, the goal is to figure out the right set of incentives that would encourage someone like Ann, from the example above, to be a good actor.
We will explore some very interesting ways in which we’re solving these issues and continuously strive to make Yuser a more rewarding and positive environment for our users in the Gemnomics pt.2 article, where we’ll cover more about the future of our community, where we’re heading, talk about staking and distribution of Diamonds.
Gemstones, tl;dr
- The maximum number of Rocks/Gemstones created each day is capped by [Nb of Active Users x Engagement x (50,000 + NB of NFTs owned)]
- Wallets can only hold 50k of Rocks unless they are unlocked with an NFT
- There are always Gemstones that can be rewarded to users no matter the size of the network
- Gemstones don’t have a set dollar value
- Gemstones are not a crypto token
- Gemstones cannot be taken out of the Yuser Network
- Users do not need any prior knowledge or Metamask (or other wallets) to earn and use Rocks and Gemstones
- Gemstones staking is coming soon to Yuser
***
FIND US
Yuser Web App Beta [if you want to join Yuser you need to go to our Discord and find someone who will invite you — hint: try to talk to one of our ambassadors!]
