Misaligned Incentives of the Crypto Creator Economy Post

The creator economy didn’t spring from nowhere—it matured as the internet shifted from “free with ads” to simple, recurring, fan or consumer paid access for content creators. Theres two buckets here, one is a monthly subscription fee where you get unlimited content within a catalog or ads removed - this would be YouTube or Spotify, where the creators receive a cut based on consumption. The other model is a monthly fee to receive exclusive content from a creators - examples here are Patreon, Twitch, or OnlyFans. Generally speaking though they all converged on the same core loop: consumers pay a predictable amount for content or perks, and creators earn predictably from that demand. It works because the value is obvious (watch, listen, engage) and the costs are consistent and transparent: YouTube Premium is $13.99/month for ad free service; OnlyFans Subscriptions run from $4.99 to US $49.99 per month to see varying content (lots of nudes though). None of that asks fans to gamble or speculate on content—they just pay a fee and receive what they love. Sure theres no upside if the creator goes viral and you were early to their content, but you also don’t get burned buying a shitcoin that represents a piece of content with the facade that you’re making an investment of some sort. I feel that the incentives around consumers and creators in web3 have generally been misaligned, and there are better ways to use this technology to enhance the experience for everyone.

Web3 promised to level the creator economy: own the rails, port audiences across platforms, and let supporters “own a piece” of what they love - but own what? SocialFi apps like friend.tech and Zora took a swing—friend.tech turned gated creator access into on-chain “keys” with a fee on each buy/sell to the creator (also an option to initially buy your own keys) - speculators ran these up to insane prices in some cases, before crumbling down and ending this experiment; Zora which has a lot more mindshare currently has evolved into a different approach and made every profile and post a tradable coin, directing trading fees to creators and wiring trading straight into automated liquidity. On paper, that sounds like an incentive machine; in practice, it drifts toward trading over relating - speculators win, fans potentially lose. When a post is a coin, the chart too often becomes the content. Something feels wrong here. Creators are causing rollercoaster financial emotions with consumers - when price goes up, they love you, when price goes down, they don’t love you anymore. Imagine being a ‘collector’ of your favorite artist - you buy their token thinking ‘hey this will go up, I love her music and she's awesome - this must be the best way to support her work’, but is it? In reality early speculators who have bots set up or have capital ready to deploy speculatively are positioned to be early and exit the position, they don’t care about the creator, and see you (the fan) as their exit liquidity. These are misaligned incentives!

Another issue is that creator income is tied to trading fees rather than consumption, churn is a feature, not a bug. Incentives aren’t aligned to create the best content for consumption, they’re incentives to create the best content for trading fees - it's how they end up making a living. Even the Solana Foundation flagged this misalignment: creators only earn when tokens change hands, while holders lose interest after the novelty fades, as this happens price goes down, as this happens they create a negative relationship with the creator - they’re losing money! I don’t like when I lose money, and I especially don’t like when I lose money thinking I’m supporting a creator, but I’m just supporting a speculator and the creators getting a fee - the winner here isn’t the creator, it's the speculator. We’ve seen this movie over and over: friend.tech racked up fees, then deposits and the creator tokens cratered as early speculators dumped on people's heads. Why shouldn’t this money go directly to the creator? No token goes up forever, there comes a time where there are winners and losers with any token or investment.

Meanwhile, Web2 keeps winning by doing the boring things beautifully. Fees are legible and mostly fixed: OnlyFans takes 20% of fan payments and continually delivers a high quality UX to encourage creator <> fan relationships; Patreon’s new creators are on a flat 10%; Twitch’s default is 50/50 on subs with higher tiers (60/40 and 70/30) for consistent performers; Spotify’s model of a monthly fee for unlimited content is as good as it gets for music lovers. Fans can support for a few bucks a month without needing to watch liquidity or more importantly think they are ‘investing’ into something, and creators are rewarded for consistent delivery or high quality libraries of content, not having to encourage asset volatility. That’s why the slope of a Substack or Patreon income line looks like a subscription business—not a memecoin. I’m not saying crypto and the creator economy model can’t work, I’m just saying that the systems around “coining everything” creates incentives that are misaligned for the creators and consumers.

Here are a few ideas that could be a better model (with many more out there), all be it, less degeny while producing a better fan/consumer relationships with crypto rails.

• Staking models – Fans lock yield bearing tokens to support a creator for a period of time; in return they receive access, exclusive content and possibly a share of future earnings. Longer‑term stakes could be rewarded more than short‑term flips. Yield bearing assets like eETH or JITOSOL (or the underlying and converted) can be deposited into a smart contract. The creator gets the yield, and in return you can get fan tokens or digital collectables the longer you’re a dedicated fan.

• Revenue‑sharing tokens – Issue tokens that entitle holders to a share of future revenue (music royalties, sponsorship deals) via the issuing and payment platform for full transparency. Token value is tied to real cash flows of the creator's growth rather than trading volume and early fans build a positive financial relationship tied to the creator's success rather than speculation.

• Community governance without speculation – Use soulbound tokens for voting and recognition. These tokens cannot be traded, eliminating financial speculation while still giving fans a say. The creators would need to determine the best method of doing this either via in-person events or proven identity.

The bigger issue with these models I’ve provided is that they don’t offer speculative fever. They are a method of using crypto rails to create a more engaged creator <> fan experience. I think the current model is gaining so much traction because there IS speculation and people just like to speculate - I’m no different. I’m also not a content creator, but a great place to start is by dropping the casino aspect if we want this to work long term for creators. We need to experiment with the merge of tokens to cash flows for quality creators, or experiment more with loyalty rails that complement familiar subscriptions: fans pay a fee for access; soul bound token gates access and voting from IRL or digital experiences where their identity is proven via zkTLS or similar; on-chain points accrue for real engagement (attendance, contributions, referrals - this can be done via IYK or similar tech) and unlock perks. If you want speculation out, make the speculative instrument impossible to trade and keep the utility front-and-center for the consumers. In other words: borrow the predictability consumers already understand, then use crypto rails to add the ownership, portability, engagement and transparency that Web2 can’t match. Build relationships, not roulette wheels.