The internet economy moves fast. When a new tech company with a potentially global reach emerges with a large user base, investors are quick to give it a large market cap. Uber, for example, was valued at $91 billion while still losing money. Last Thursday, Uber reported its first profitable quarter since it launched more than a decade ago. It’s clear to everyone that loyal users are what drives a company’s success. But what does this situation mean for the way businesses allocate their profits?
As the market for digital services matures, with crypto and blockchain pushing towards building a new financial system, there must be a rethinking of the place of the customer in a company’s economics. If users are the most valuable asset for a tech company, doesn’t it stand to reason that those users should be rewarded for their contribution? Attention is the 21st century’s most important commodity.
While most established companies have loyalty programs rewarding their most valued customers, the new landscape of the tech industry points to the user being able to command even greater rewards for their loyal patronage. In addition, many people are seeking sources of passive income to contribute to their wealth, or just to help provide stability in an uncertain economy. Enter: the staking function of crypto assets.
In staking, blockchain has introduced an extremely simple method to reward early adopters and loyal customers. As an example, we can look at Tokenplace, an up-and-coming platform for crypto traders and investors that allows users to buy and sell coins across the whole landscape of dozens of exchanges without switching windows or doing multiple logins. As with many crypto companies, it has a native utility token, TOK, which gives users discounts and other bonuses. In the case of TOK, it also has a use case as a carrier of liquidity in its multi-exchange trading engine. Now, however, Tokenplace has announced that it will provide a staking option for holders of its coin, which it sees as a way to appropriately reward its users for the value their loyalty and attention brings to the enterprise.
“The move to divert a non-trivial part of our revenue to user rewards fits perfectly with our vision of what the corporation of the future should be,” said Tokenplace CEO Nina Knox. “On one hand, it’s clear that we owe our users a great deal, given the value they bring to the table. On the other hand, we see that people are entering crypto seeking to offset the instability of a 21st century economy by having some measure of passive income coming from their digital wallets. We recently saw data on the numbers of Americans leaving poorly paid jobs because of their ability to leverage crypto investment. And we believe we owe it to our users and early adopters to reward them in proportion to the revenue and investment their attention brings.”
Buying into a utility token like Tokenplace’s TOK creates a synergy that is beneficial both for the company and the user. When a user is also a token holder, every time they pay for services from their chosen company, they know that they are also increasing the value of that company. One way to think about this is to imagine being in a grocery store and choosing between two cups of yogurt. One is made by a large enterprise company with which you have no connection aside from their aggressive traditional marketing; the other is made by a company that rewards you for your loyalty in a significant way. The more you buy, the greater the potential rewards.
It’s quite likely, then, that this trend may catch on outside of the world of crypto, as companies seek a competitive edge by increasing the buy-in of their customers. It’s clear that DeFi is revolutionizing the world of finance, but the token staking pool format may be a highly useful instrument that can be taken up by all businesses, from dairy farmers to smartphone manufacturers and digital content creators.