Originally published at medium.com
As the Acuity browser is nearing completion, users will soon be able to post content on MIX.
Of course creating a effective mechanism to pay content creators is an essential part of the project. Steemit inflates the currency to pay content creators, but this is not sustainable.
YouTube uses advertising. Many websites use paywalls. Both these approaches are irritating to consumers and ignore the fact that the Internet is global copying machine. The solution is to directly monetize the brand.
For a long time I have wanted to implement a donation system that uses social badges for gamification, however I have now become convinced that tokenization of artists / projects is a much better solution for effectively paying content creators.
I would go as far as to say it is an order of magnitude better. Many other projects are working on this sort of tokenization also. It will eventually become normal with every content creator large and small having a token that is traded freely on the open market.
So how would it work? Anyone can create a token.
The creator can choose the initial allocation they receive and how much they get paid everyday. Both the initial allocation and the ongoing payment are created out of nothing.
This creates disinflation, much like the original plan for Ethereum: https://blog.ethereum.org/2014/04/10/the-issuance-model-in-ethereum/
Fans want to purchase the token, either from the creator or on an exchange, so that they can show on their profile how many tokens they have and prove that they are a real fan.
These tokens can be traded for anything else on both centralized and decentralized exchanges, just like ERC-20 tokens on Ethereum.
The more popular the creator and the slower they sell their token, the higher the price of their token.
Because the token is a freely tradable asset a lot of sophisticated things can be done. The creator can hype up their project and sell tokens to fund the project before they begin. They could even be used for a Maker DAI Collateralized Debt Position.
Being able to speculate on the value of an artist’s token can generate significantly more revenue for the artist than merely gamifying donations.
Another problem with gamifying donations is “circular donations”. A fan in collaboration with an artist can continually donate the same funds in a circular fashion, defeating the gamification system. Tokenization is immune from this attack.
There could be tens of thousands of such tokens. It’s actually impossible to imagine all the ways the tokens could be used.
So what affect would this have on the MIX price?
Paying content creators effectively without having the fan irritation of paywalls and advertising will be a massive draw for the platform. This will create more MIX transactions and make MIX more well known, thus increasing the value of MIX. These MIX tokens would not compete for market cap with MIX itself.
Also, the MIX tokens will not necessarily be traded with the MIX coin. They will be able to be traded with many other crypto and fiat currencies on exchanges.