Edgy - The DeFi Edge 🗡️
@thedefiedge
Systems Thinker - Sharing Crypto strategies, insights, & analysis to help you level up. Partner @0xMantle @0xCoinshift. DMs open for deals.
How Crypto Influencers Make Money From You
Here's how Crypto Influencers Make Money from you:
"Show me the incentive and I will show you the outcome." -Munger
Why are influencers sharing their alpha?
Ask yourself, "What's in it for them?".
This is important so you don't become exit liquidity.
I'm going to share with you the most common business models out there.
1. Affiliate Deals
They promote a product, and they get a % of every sale made.
Examples:
• Ledger HW wallet pays 10% commission.
• Koinly Tax software pays a commission for each sale.
• The major exchanges have lucrative affiliate programs.
2. Sponsorships
Companies want eyeballs. They can't advertise Crypto on Google or Facebook right now.
Huge demand & low supply.
So they turn to influencers.
Sponsors usually pay a flat fee for a newsletter or podcast shoutout.
3. Premium Content
They're sharing information. Maybe there's MORE info that they're not sharing publicly.
This would fall under premium content.
It's kinda like how some people on IG share free pics, but you gotta sign up for their Onlyfans to see more.
Examples:
a. Consulting by the hour. They'll give you advice or do a portfolio review over the phone.
b. Content Upgrade. You have premium substacks or yearly stuff like Delphia Digital / Messari.
You get a deeper level of information.
c. Courses
A bunch of videos and content that teach you their methods and systems.
d. Private Communities (Forums / Discords / Telegrams)
You get access to a community, their project picks, and maybe some 1 on 1 time /w them.
e. Community support like Patreon or donations
4. Dealflow
Some protocols are looking at influencers for investments. They can provide distribution & hype.
Influencers can make their money by getting access to tokens at a price far cheaper than the public does.
Retail investor > Influencer > VC is a path.
5. Validators
This is an interesting one that most people don't realize.
Influencers push a certain coin and ask you to join their staking pool. They get a % of the staking fees.
Have you ever noticed how a lot of larger Youtube accounts keep pushing Cardano?
6. Protocols
Some people are starting their own projects. Or they're joining the team of some.
I saw this a lot in the eCommerce space.
Influencers who created products would immediately have distribution.
Kinda like Beauty YouTubers starting a makeup brand.
The Shady Ways Influencers Make Money
It's no secret that some influencers abuse their trust.
Shady means that the audience doesn't win, or they don't receive value.
Here are some methods to watch out for:
Undisclosed Promos
Project X pays them either tokens or cash to promote their project.
Influencer talks about how awesome it is but doesn't disclose this. This comes off as a genuine endorsement when it wasn't.
It's actually illegal in certain countries to do this.
Pump and Dumps
They buy $100k of X coin (low market cap)
They talk about how awesome it is. The price pumps by 30%.
They dump the coin for an easy $30k profit.
Cash Grabs
This could be any number of projects that don't deliver what they promise.
• A course that's copy & paste info without any value add.
• An NFT collection that's half-assed.
• Endorsing and shilling crappy projects for a payday.
Here are some red 🚩 to watch out for:
• They ONLY talk about projects that they hold.
• How well do the projects perform after the influencer shills them?
• Do they disclose what projects they own?
twitter.com/thedefiedge/status/1493658214755303425
And remember that someone can start off with good intentions, but people change.
It's easy to turn down $1k promos, but what about $10k offers?
or if it becomes a bear market, but their Lambo lease payments are due.
They should earn your trust over and over again.
This thread isn't meant to be negative towards influencers.
The average joe isn't going to read white papers - influencers play a part in growing the space.
Quality content takes countless hours to create.
They should be compensated for what they do.
Advice to Influencers:
• Be honest and transparent. If you're shady, it'll catch up to you.
• Think long-term.
• There are legit business models out there that don't involve pump and dumps.
Read some more advice from Zach
twitter.com/zachxbt/status/1498670002161000452
How Does the DeFi Edgelord monetize?
I haven't made any money since starting this account.
My account's new, and I'm prioritizing growth & writing content at the moment.
The main benefit that I'm getting now is access.
I'm networking more.
Getting invited into private groups.
And if I have a question, developers usually get back to me.
(I got ignored a lot on my 3k follower account before)
I'm getting more "alpha" than ever before because of this account.
That value is priceless.
I'd like to monetize in the future, and in a way where everyone wins.
There's a demand for quality education in DeFi.
I'd love to re-invest into building a team of world-class DeFi researchers.
And then see what opportunities are available from there.
Takeaways:
• Never blindly trust someone's advice. Think about "What's in it for them"
• Influencers can put the spotlight on a project, but always do your own research.
• Try mapping out your favorite influencers' business models.
If you enjoyed this,
Please follow me @thedefiedge for more threads on DeFi, frameworks, and the latest alpha.
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Read: typefully.com/thedefiedge/hI4E5uI