Social tokens are products of Web 3.0 where content creators can build and reward their fan community and compensate themselves for their creative work. These tokens are largely limited creating scarcity and increased demand over time can lead to a surge in their value. Fans can also buy these tokens but most of the time, creators give them away for free as means of gratitude to loyal followers.

The concept was similar to celebrity bonds first introduced in 1997 by David Bowie an English singer-songwriter and actor. He is regarded as one of the most influential musicians of the 20th century. He issued Bowie Bonds to a unique type of asset-backed security used as collateral for his royalty streams, future album sales, and live performances. It was bought by the Prudential Insurance Company of America for US$55 million or $88.7 million in today’s dollars.

Social tokens are an evolution of the internet from Web 1.0 to Web 2.0 and finally to Web 3.0. They could be similar to celebrity bonds but have no intermediary involved in the transaction. Unlike ICOs, they are promoted via efforts by existing communities around the creator which facilitates actual value creation. But what are the uses of social tokens?

Uses of Social Tokens

Let’s take a look at the uses of social tokens of today.

Loyalty Reward

Rewards are the coolest things that businesses today use to benefit their loyal users or consumers. What could be more ecstatic than receiving a reward from a service or product you really enjoyed and love? That’s one aspect that makes social tokens really enticing. This works two ways for social tokens since this could strengthen the bond between the creator and their fans and at the same time could attract new fans. Rewarded consumers can redeem services depending on their token balance. They also feel empowered with a sense of ownership of the business’s service catalog.


Due to the proliferation of frauds in the crypto space, social tokens are also vulnerable to such. With the use of social tokens, brands can create an ecosystem for their business to which only genuine fans or consumers can participate in transactional experiences. This can also improve sales by catering to an exclusive list of clients who have a high affinity for their offerings.

Easier Sale

With tokenized assets, physical businesses like food and products can be tokenized into their digital avatars. This makes it possible to be traded within the business’s own mini-ecosystem of loyal consumers. Social tokens eliminate tenacious paperwork and lengthy procedures for consumers. All information, certificates, and authoritative support elements of a physical asset are now offered as digitized tokens. This also serves as a seal of ownership and trust in connection with the real-world value of the products sold.

Lucrative Investment

With social tokens, entrepreneurs and business brands can create a pool of their own tokens where investors can buy. And with the immutability offered by blockchain, the price of the token can be enforced. Autonomous enforcement of contracts becomes an umbrella that protects investors from getting duped or falling victim to fraud which results in loss of money even if the business is doing well.

With Web 3.0 just around the corner, social tokens will definitely be the “next big thing in crypto.” But are there risks associated with social tokens? Just like any other digital asset, social tokens are subjected to risk. What are these risks? In our next article, we will discuss the different risks surrounding these virtual assets.