After an astronomical bull run into the beginning of this year that was followed by an abrupt halt and 50% drop since April, crypto markets are at a fork in the road right now. Where they go next could inform us about how market conditions impact mainstream adoption via artists, creators and celebrities who have been taking a greater interest in the space.
To date, the market for nonfungible tokens (NFTs) and social tokens has been anecdotally correlated to the broader crypto market. As creators bring in more fans from outside of crypto, we’re seeing that correlation diminish, albeit with a small sample size. If Bitcoin (BTC) and Ether (ETH) don’t break out of their respective slumps and we do enter a bear market, there is a strong case to be made that the growth of the creator economy will insulate social tokens from the effects of the rest of the market.
The reality is that most creators’ audiences don’t care about the price of BTC or ETH — at least not yet. They are buying tokens to unlock exclusive token-gated benefits and to interact with their favorite artists and creators in new digital and physical ways.
As always, whether the next few months are bullish or bearish, both scenarios present unique opportunities for our industry. Whether the market pulls in new participants in good market conditions or shakes out the “weak hands” in a bear market, the near future presents a very pivotal time for the intersection of the creator and crypto economies.
NFTs cool down, weeding out the weak hands
Since the crypto bull market and NFT boom took off earlier this year, creators and celebrities have taken up a great deal of space alongside Bitcoin in the mainstream conversation about crypto. Today, the NFT market has cooled significantly, and fewer big-name celebrities are cranking out NFTs like we saw in March. Does this mean that NFTs were a passing trend, or will crypto change the way that celebrities and their fans interact in the long run?
There’s little doubt that a few celebrities have used crypto for easy endorsement money or to make a quick buck. But many of them are truly exploring how crypto can bring them closer to fans and using the technology to express themselves in new ways.
At the end of the day, influencers who used crypto as a “cash grab” will disappear from the space during down cycles, as have many generations of crypto tourists. We’re still talking to a lot of genuinely engaged creators about how they can incorporate NFTs into a larger-scale crypto activation with their fans. Whether they’re household-name celebrities or creators with an engaged, albeit more niche, audience, the foundation for creators and crypto has been firmly established to withstand any market conditions.
A breakthrough for the “middle class”
It isn’t just household-name creators who are using crypto to forge deeper connections with fans and own their financial relationships instead of allowing Big Tech platforms to dictate the terms – creators with smaller and mid-sized followings have also explored ways to connect with their audiences via crypto and NFTs.
The creator economy is made up of more than 50 million YouTubers, TikTok stars, bloggers and other types of content creators. The sector is growing at a breakneck pace: Ad spend on influencer marketing alone approached $10 billion last year, not to mention creators transacting directly with their fans. Within these direct creator-fan transactions, crypto is becoming more and more common.
Despite the fact that the NFT market has retraced, creators are continuing to explore the space and the tech is continuing to build toward more functionality and utility. Within crypto, creators with million-dollar “market cap” economies are more common than ever. And it isn’t just creators from the cryptosphere who…
Read More: cointelegraph.com