The future of the world is changing. Cryptocurrency and blockchain are taking over. And that includes the world of advertising. It’s also going to impact social media platforms, like TikTok. But before explaining how, we are going to start by explaining exactly what cryptocurrency and blockchain are, and why they are huge technological advancements.
What is Cryptocurrency?
Cryptocurrencies are digital assets that use blockchain technology to create a public, decentralized ledger that is visible to anyone. This means you can transparently see almost every transaction that takes place. Created in 2009 by a mysterious anonymous figure named Satoshi Nakamoto, Bitcoin was the first cryptocurrency to come into existence. However, there are now over 10,000 cryptocurrencies available to trade other than Bitcoin.
A cryptocurrency is a digital or virtual version of currency that is very secure and is often pretty much impossible to counterfeit, duplicate, or re-spend. Many cryptocurrencies are based on decentralised networks, in the form of blockchain technology. These decentralisied networks are often likened to banks but they are often owned by nobody. However, this is up for debate because some creators often hold high percentages of the created tokens, which means they can have a big impact on valuations. Blockchains are distributed ledgers that run based on a network of computers (often computers based around the world). This is what makes blockchains so secure – you would need to stop the whole network of computers to shut the network down or intercept the network.
What also makes cryptocurrency unique
A defining feature of many cryptocurrencies is that they are often not issued by any central authority (like a bank or government). Because of this, they are pretty much immune to government interference or manipulation (which is possible with British sterling pounds (£) or the United States Dollar ($)). Cryptocurrencies, such as Bitcoin have a limited scarce amount of Bitcoin, so only 21 million Bitcoin will ever exist. As a result, the price rises when more Bitcoins are purchased, making it more inflation-proof. Increased demand with the limited supply, helps Bitcoin owners to profit from the rise in price.
How Crypto Works
Most of these new coins are mined using computer power to solve equations, which are then put together in “blocks” to create the blockchain. Over time, it becomes harder for computers to solve these equations, which means you can mine fewer coins. In some cases, this creates scarcity, which increases the value of coins over time. However, there are now many coins that exist in the billions and trillions — and they have managed to accrue enormous market caps.
The price of a cryptocurrency is largely influenced by perceived value, which means that social media platforms such as TikTok can have an enormous impact on the crypto market. In July 2020, the cryptocurrency Dogecoin, based on a meme featuring an adorable Shiba Inu dog, soared to new and unexpected heights. Although largely dismissed as a joke by more serious crypto investors, Dogecoin reached an all-time high by rising from £0.03 to £0.53 within 2 months on May 2021, making millions for many early investors.
But what caused this sudden spike in price? Most crypto enthusiasts point their fingers at billionaire Tesla CEO Elon Musk, who began making ambiguous doge-related tweets in December of 2020. But what pushed Dogecoin towards the attention of Musk in the first place was the power of crypto-pumping TikTok creators, who turned the meme-themed coin into a viral phenomenon.
“Here’s a crazy thought, what if everyone watching this video went and bought some Dogecoin?” asked one early doge-pumper, whose video went viral on TikTok in July 2020. “THEY CAN’T STOP US ALL”, wrote one commenter.
@cannolicryptoIf this ever hit a dollar I’d be loaded. Everyone invest so we can all get rich ##duet ##dogecoin ##stocks ##CantStopUsAll♬ original sound – TraderToks
This viral movement, involving many small TikTok crypto-traders attempting to influence the price of DOGE on a mass scale, led to its price jumping 95%. Five months later, Elon Musk uttered his profound market-influencing tweet – “One Word: Doge” – causing its value to leap a further 20% overnight. This rise and subsequent fall of Dogecoin was an unexpected rollercoaster put into motion by TikTok crypto influencers.
@karimhemdan12Go invest in Dogecoin, make me rich ##fyp ##foryou♬ Lets get rich tiktok – James G
How Does Crypto & Blockchain Impact Marketing?
The world of marketing is already colliding with the world of crypto. Blockchain and crypto are changing the way companies market themselves. Amazon and Facebook are both attempting to integrate blockchain technology into their business models. In addition, McDonald’s recently released their own sandwich-themed NFT.
What is an NFT?
An NFT (also known as a non-fungible token) is a digital or virtual asset that often represents a real-life object, such as a piece of art, a sword in a game, or even real estate. NFTs can be used as branded products or even branded virtual worlds.
One innovative example of how the future of advertising might work is the Brave Browser. This free-to-download chromium-based browser, allows its users to block advertisements in its default mode. However, if users opt in to view ads, they can get rewards in the form of Basic Attention Tokens (BAT). This system tackles one major issue related to advertising – the selling and stealing of personal data. But it also opens up new opportunities for the right people to see your brand, without prying into their personal data against their will.
In 2019, Unilever and IBM launched a blockchain pilot, which aimed to reduce unnecessary ad spending online. According to Michelle Peluso, the CMO of IBM, only 40 cents of every dollar spent on advertising online reaches the publisher. Partially, this is thanks to the increasing number of middlemen who take a cut along the way. The blockchain project aims to reduce this by cutting out unnecessary time and money spent on overheads such as billing reconciliation, while also creating a trusted and decentralised record of how media is purchased and delivered.
New Opportunities for Brands
“Using easily accessible software, new coins can be created and released in a matter of hours. This could create a new unique way for brands to gain publicity, such as through the creation of a branded cryptocurrency”
Crypto has opened new opportunities for marketers to engage with their audiences. Creating a new cryptocurrency is surprisingly easy, and no longer requires a team of developers. Using easily accessible software, you can create and release new coins in a matter of hours. This could create a new unique way for brands to gain publicity, such as through the creation of a branded cryptocurrency. Imagine if you own a company and you’re looking for new creative ways to raise your profile. You could create a cryptocurrency backed by your company, and use it for e-commerce through your company website. Not only could this increase brand recognition, but it could even generate additional revenue for your company.
However, the ease of creating new coins and tokens opens up opportunities for marketing scams in the currently unregulated market. In 2021, Netflix had a huge hit in the form of the Korean dystopic series Squid Game. Shortly after the show hit maximum hype online, there was the release of a “Squidgame” crypto token. Fuelled by the hype of the Netflix show, its value began to rise exponentially at lightning speed by more than 35,000% in just three days.
In theory, the token was useful as a “play-to-earn” currency to gain entry into an online game, where you could also earn more tokens. Over just a few days, it jumped in price from $0.01 to over $500. Unbeknownst to many people who put their money into this mystery token, it had no affiliation with the show. When the price began to hit ludicrous heights, investors discovered that they were unable to cash out. Labeled as one of the fasted rug-pulls ever, within minutes the price dropped to nearly zero.
The scam-coin creators had cashed out, which caused the price to crash and left buyers empty-handed. This debacle demonstrates that crypto can potentially create situations where murky and unethical branding could take advantage of investors.
The Branding-Nature Of Crypto
Cryptocurrencies can be considered a type of “brand”, and their value is largely based on the perceived value of the said brand. The concept of scarcity can also impact its perceived value, such as in the case of Bitcoin or other altcoins with a low max supply. However, as you can see with alt-coins such as SHIBA, which has over 500 trillion tokens in circulation, the hype is still the biggest factor influencing their price. Much like a Birkin bag, which doesn’t do much besides holding your wallet and keys, yet can sell for well over £50,000, the value of a coin comes down to its branding.
Venturing Into The Metaverse
This year, Facebook’s CEO Mark Zuckerberg announced the rebranding of their holding company as “Meta”, while also declaring their intention to develop a concept they termed the “Metaverse”. The ensuing media commotion left many people questioning what exactly this meant. According to Zuckerberg, the metaverse is an immersive digital world built over our own which is accessed using virtual reality technology. “We believe the metaverse will be the successor to the mobile internet, we’ll be able to feel present – like we’re right there with people no matter how far apart we actually are,” said Zuckerberg.
Despite this declaration, there are already many virtual metaverses already in existence today, such as The Sandbox which has attracted artists such as Snoop Dogg. Snoop owns his own land in the game and performs live virtual concerts for exclusive fans that are on The Sandbox.
“The idea behind the metaverse is to tie these virtual spaces together, allowing people to use digital avatars to seamlessly pass-through different worlds.”
Immersive virtual reality communities — Second Life being a notable early example — have existed for decades. In 2019, Facebook introduced Horizon as a social virtual world that could be explored through VR technology such as Oculus Rift. There are numerous other popular explorable virtual worlds already in existence, such as Minecraft, The Sandbox, Decentraland, and IMVU. The idea behind the metaverse is to tie these virtual spaces together, allowing people to use digital avatars to seamlessly pass-through different worlds.
Although the metaverse as a concept has not yet been fully realised, the flurry created by Zuckerberg’s announcement, created a virtual land grab. Virtual realms such as Decentraland and The Sandbox capitalised on this by stating that their metaverse real estate would remain finite. As such, buying early could mean huge future returns for investors. If the metaverse truly goes mainstream, these virtual spaces could forever change the marketing landscape. It would be in much the same way as the World Wide Web did back in the 90s. Advertisers could lease these virtual spaces in prime locations in the same way that online social platforms like YouTube, TikTok, and Facebook sell ad space. The difference is that thanks to VR technology, marketing will be a far more creative and immersive experience.
The Creation of Web 2.0
The metaverse, acting as a kind of Web 2.0, is also likely to be the future home for e-commerce. Virtual reality shops may replace online shops, allowing customers to interact with products through their avatars before buying. Imagine how this may impact fashion retail if customers could virtually try on clothing before receiving the physical products? Additionally, the metaverse is likely to massively increase the sales of digital assets. So instead of paying for a physical dress, customers will be buying virtual clothing for their avatars.
The trading of digital objects is booming. 2021 was undoubtedly been a huge year for NFTs. However, the concept of trading digital in-game objects has been going on for years. In Fortnite, a massively popular multi-player game among young teens, digital “skins” can sell for up to $100. Players use the game’s native currency — V-bucks. In other popular MMORPGs such as World of Warcraft, Runescape, and Guildwars, users can also buy and sell in-game objects. But the metaverse takes this concept to the next level through the introduction of blockchain technology.
Both Decentraland and The Sandbox have native cryptocurrencies — MANA and SAND respectively. As interest in the metaverse increases, so has the value of these coins on the blockchain. These native currencies are now becoming assets themselves. This is along with the digital assets such as land and in-universe objects that they were designed to purchase. Additionally, ownership of these digital assets is recorded in the blockchain.
How Will The Metaverse Impact TikTok?
So, what does this mean for social media platforms such as TikTok? This year, Bytedance, the Chinese company that owns TikTok, acquired a virtual reality start-up called Pico. In 2021, Pico became the third largest manufacturer of VR headsets. In addition to this, they also develop software and other technologies that relate to the VR space. Bytedance did not outline any specific plans concerning the metaverse, but they are clearly showing an interest in the prospect of virtual reality.
This isn’t surprising, considering many voices in the industry are hailing VR as the future of social media. Along with many social media platforms, TikTok already uses augmented reality technology. The platform overlays computer-generated graphics in real life in the form of various filters. The logical next step for any major social media enterprise is figuring out how to step into the proposed metaverse.
“Instead of seeing an influencer as a video on a screen and interacting through comments, users could virtually “meet” influencers and talk to them through their avatar.”
Inigo Rivero, House of Marketers Managing Director
If TikTok currently aims to connect people based on their shared interests and causes through the form of video, then TikTok in the metaverse will do the same in a considerably more immersive fashion. Instead of seeing an influencer as a video on a screen and interacting through comments, users could virtually “meet” influencers and talk to them through their avatar. This can take TikTok’s dual video feature to the next level. Creators will no longer be side by side on a split-screen. They will be standing next to each other virtually. We can imagine viral TikTok dances in the metaverse through avatars.
The Future of Branded Events
The way the Dogecoin hype spread through TikTok might also look different if it were to take place in the metaverse. Maybe a virtual reality version of TikTok could host events, where people could discuss their interests and spread ideas on an even larger and faster scale. Perhaps TikTok might move into the virtual real estate industry. The platform could sell virtual advertising space, storing the ledgers of ownership on a TikTok blockchain. The future conceived in the minds of 80s sci-fi directors will be realised this century.
What Does Crypto Mean For TikTok Creators?
The mass adoption of cryptocurrency introduces new ways for TikTok crypto creators to monetise and engage with their audience. In September 2021, TikTok announced that they were releasing a collection of NFTs called TikTok Top Moments inspired by their top creators. The social media platform claims that this will empower creators. Additionally, it will allow users to purchase socially significant moments in the form of a digital asset. These NFTs were issued in October 2020 through the Ethereum blockchain via layer 2, allowing for cheaper transactions.
Creator monetisation has been a longstanding problem in the influencer world. When YouTube changed some of its monetisation rules a few years ago, many influencers saw their earnings take a sudden hit. In this particular case, creators were usually unable to monetise. It was because their videos were deemed inappropriate for advertisements, due to strict new community guidelines. This left them in a position of relying solely on brand sponsorship. In the meantime, others felt that they had to change or censor their content in order to monetise. By introducing new ways for creators to earn money from their work, it allows for greater creativity.
“The beauty of utilising NFT tech in this way is that it allows creators and influencers to profit directly from their creations”
Shortly after the release of the first TikTok NFT, the highest bid for one of these assets reached nearly $100,000 or 25 ETH (Ethereum). The beauty of utilising NFT tech in this way is that it allows creators and influencers to profit directly from their creations. Fans who wish to own a piece of internet history, or investors who see the potential for the asset to increase in price can purchase viral moments. Could we also see a TikTok cryptocurrency released in the future?
5 TikTok Crypto Influencers To Watch
TikTok followers: 2.7m
Bitboy crypto is one of the most successful TikTok crypto influencers. He usually talks about market trends and personal stories related to his crypto investment success. His humour and wit have gathered him a loyal fanbase.
TikTok followers: 913.9k
Cryptomasun discusses crypto tech and NFTs in a way that is accessible for new investors. He aims to break down difficult concepts and discuss various crypto-related topics in layman’s terms.
TikTok followers: 226.3k
Cryptowendyo covers charts and crypto-related news. She also likes to discuss the potential of different alt-coins and covers other related topics such as NFTs and the metaverse.
TikTok followers: 142.5k
Consider him a weatherman for the crypto world. Cryptoweatherman provides his personal predictions and cryptoanalysis while delivering general commentary on the state of the crypto market.
TikTok Followers: 33.1k
Girl Gone Crypto produces funny and relatable skits about crypto, while also delivering market updates and predictions.
What Can We Expect From The Future?
NFTs, cryptocurrency, the metaverse, and digital real estate might all seem like intangible concepts to some people. However, they are about to change the way we live our daily lives. Social media through VR is likely to increase and connect people even more than the current conception of today. The world is looking at an online revolution. It may change the shape of our day-to-day lives more than we can presently imagine. This may sound outlandish, but not to anyone who is old enough to remember a time before social media and has witnessed how quickly it changed society on a grand scale.
Digital marketing is going to transform itself and migrate towards the future metaverse. Gen Z influencers have always been quick adopters of new technology. As such, they will likely embrace the metaverse and develop even more creative use-cases for virtual reality technology. The virtual space is going to become the home of influencer marketing.
Blockchain technology is changing the way we exchange goods and services online. Digital assets are rapidly replacing traditional stores of value, such as gold and real-world currencies. Concepts such as Basic Attention Token open up new avenues for marketers seeking to target the right people.
This new digital era may present new problems but it will also present many new opportunities. For any company to survive in the long term, embracing these new technologies holds the key.
Learn More From TikTok Crypto Specialists
Are you looking to penetrate the growing crypto market on TikTok? Get in touch with our team of TikTok crypto experts today to find out about our range of services. Rest assured that we have the knowledge, tools, and experience to propel you towards your marketing and business goals.
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House of Marketers (HOM) is a leading TikTok Marketing Agency. Our global agency was built by early TikTok Employees & TikTok Partners, which gives us the insider knowledge to help leading brands, like Redbull, Playtika, Badoo, and HelloFresh win on TikTok. Want us to convert more of Gen Z and Millennials with TikTok? Get in touch with our friendly team, here.