A Primer of Possibilities of BitClout

Stories about BitClout have been making the rounds on news sites and sparking lively conversations across social media. Before we dive into what BitClout is, it’s worth taking the time to understand another trending technology, NFTs. Unlike in the real world, digital objects are not unique. The “ones” and the “zeroes” can be replicated perfectly as many times as you want. On the other hand, NFTs, or non-fungible tokens, allow for the creation of one-of-a-kind digital objects. This is revolutionary because for the first time ever, value can be assigned to digital objects. The explosion in the popularity of NFTs hints at the pent-up demand for such an innovation. NFTs have been used to tie value to digital objects such as digital trading cards, art, or even music albums. BitClout is a similar technology with a more ambitious goal; using its tokens to tie value directly to real people.

BitClout is a crypto social network that allows users to monetize their followers and invest in other users. The basic user interface and actions resemble Twitter with posts, profiles, follows, likes, etc. Similar to Bitcoin and unlike Twitter, Facebook, and Instagram, BitClout is completely decentralized with a fully open-source. In other words, there is no company behind BitClout.

BitClout is such a new technology that we had turn to an expert in the space to check our understanding and walk us through the possibilities of this new social network. Mario Nawfal, a serial entrepreneur and business influencer, started his first crypto business 4 years ago, International Blockchain Consulting (IBC). Mario Nawfal was one of the earliest adopters of Clubhouse. His daily room “The Roundtable,” is the #1 room in business.

BTCLT and Creator Coins

There are two classes of tokens on the platform. BitClout is the platform, but also the name of the native cryptocurrency (BTCLT), which is basically what the whole platform is based on. Mario Nawfal says that “this helps fight against the high number of bots and spam that are common with other social media networks.” Don’t worry though, most trivial actions on BitClout, such as posting and liking, are essentially free. Signing up on the BitClout platform gives new users a starting amount of BTCLT, and more of this coin can be purchased on the platform with Bitcoin.

Creator Coins are the mechanism through which users monetize their reputation or invest in other peoples’. Every user on the platform gets their own coin, which anyone can buy and sell. The price of each coin rises when users buy, and falls when it is sold. If you believe a coin is going to rise in value, then the earlier you buy the coin, the greater your profit will be down the line.

Almost all of Mario’s excitement is aimed at Creator Coins. These coins allow users to invest directly in other users just like them. Creator Coins allow users to frictionlessly turn their social capital into financial capital. They are essentially a new asset class that ties value to the reputation of individuals.

How do Creator Coins work?

Let’s say a user named Alice signs up on BitClout. When Alice initially creates her profile, there are zero “Alice Coins”, thus the price for purchasing her first coin is zero. If another user, let’ go with Bob, wishes to buy coins from Alice’s profile, the platform will create, or mint, the coins and sell them to Bob. The price per coin will increase based on a predetermined curve visualized below. Creator Coins are actually denominated in BTCLT, but are translated to US Dollars for simplicity.

It’s important to mention that the coins are very scarce, and as more coins are purchased, the higher the price will increase. Once 500 coins have been created, each coin will cost over $10,000. Buying generally increases the number of coins in existence and the value of all coins based on the above curve, while selling does the exact opposite.

Every user on the platform has the choice to retain a certain percentage of the coins that are created as per the platform’s “founder reward”. In our example of Alice, if she decides to set her founder reward at 10%, and Bob buys 100 BTCLT worth of Alice’s Coin, then 10% of the coins purchased would go to Alice’s wallet. BitClout only pays founder rewards in net purchases. This means that if Bob buys 100 BTCLT worth of Alice’s coin, sells it, and buys back 100, Alice’s reward would still be 10%.

Mario, who is already one of the most active users on BitClout, advises users to set their founder’s rewards very low, preferably zero. “The best way for users to profit from their own presence is to buy their coin when they initially create their profile. The coins are very cheap early on when they are very few.”

Possibilities of Creator Coins

“There are so many great ways to incentivize investors with your own coin,” says Mario. You can limit the people who can send you messages or comment on your posts to those who hold a certain amount of your coin. You can also increase traffic to your profile by purchasing a more popular user’s coin in exchange for a “reclout”, or by “reclout-ing” a less popular user’s post if they purchase your coin. Moreover, you can create premium content to entice new investors and retain the ones you already have.

Mario Nawfal shares premium content with his top investors only. “I’m proud to run the biggest growth hacking agency (WeAreGrowthHackers.com), and the interest in BitClout is substantial. We’ve helped bring in many celebrities and influencers to the platform.” Mario is also leveraging his business for his BitClout investors. “If you are one of my top 10 investors, you will get notified whenever we bring in a celebrity to the platform. Remember, coins are very cheap early on.”

Some of the perks top investors get with Mario’s coin include custom art pieces, signed posters from celebrities, or simply exclusive access.

Some of the perks top investors get with Mario’s coin include custom art pieces, signed posters from celebrities, or simply exclusive access.

Mario says, “I communicate a lot and make myself available for my top investors.” Furthermore, he mentions that the key is to add value to your investors and followers, just like you would with any business. “With my incentives, I was able to raise $400,000 in four days, but that’s only the beginning,” -Mario

Future of BitClout

Mario believes BitClout is growing exponentially in 2021. “It takes time for people to get comfortable with new technology, but when they do, growth becomes exponential.” Mario Nawfal is not only focusing on getting investors, he’s also investing in others on the platform.

“Bitclout is a place to create communities and long-term relationships,” says Mario Nawfal. “It has all the elements that make a great social media platform”.