There is no doubt that social media go hand in hand with the development of the crypto industry. Because even the legendary two pizzas bought for 10,000 BTC back in 2009 starts from the discussion thread on the BitcoinTalk forum. Right now, even the shortest message on Twitter by a worldwide crypto influencer might send the markets haywire.
Comments under the posts help people buy billions of dollars worth of bitcoin (there’s a rumor that this way the MicroStrategy CEO Michael Saylor helped Elon Musk buy $1.5 billion BTC on behalf of Tesla). Reddit and platforms alike help the development of new blockchain networks. Obviously, social media has a significant impact on crypto industry development. Let’s go a little bit deeper and explore that influence.
Sure thing, traders from all over the world closely watch the slightest price movements to place the most beneficial orders. They need to precisely predict whether the price for the coin will move upwards or downwards within a certain timeframe. Practically, their earnings depend on these fluctuations.
And also, there is a very important pattern of cryptocurrency markets that is affecting the prices to a big extent. That is the psychology of traders. The thing is that these days, everyone can buy, and sell cryptocurrencies or trade on their derivatives, including people with relatively small budgets. Oftentimes, these people are far from professionals.
Perhaps, they’ve read a few articles about trading and watched a video on youtube. That’s why the price swings of some coins are so drastic. Because, basically, millions of people without extensive expertise are trading it emotionally, buying or selling them after every hype message posted somewhere over the Internet.
Other than hype and news about large investments, online discussions in social media also drive cryptocurrency markets. Some new blockchain networks are actively promoting themselves in order to gain more followers and spread their new tokens among wide audiences. Another case is when people are actively discussing their user journey through the world of crypto with other users.
This way, they help in generating trusted reviews of various services at exchanges and trading platforms. For example, if you didn’t know how to sell your crypto, you can go to a community of crypto enthusiasts and ask for their advice at any time. You’ll get many answers, and one of them will be applicable for sure. For example, they could advise you to exchange BCH to BTC on CEX.IO and tell something about their own experience with the platform, which will help in your own exploration of the crypto services.
Tipping personnel in hotels and restaurants has become a part of the world’s culture. With the rise of cryptocurrencies, it became available to incorporate digital tipping in new and popular social media. At the time of writing this article, users of Reddit are already actively using this service. They encourage each other’s comments by giving small amounts of crypto.
Same is available in Brave browser, as well as platforms like Hive, Bitfinex, Mamby, and more. Users of Steem, BitTorrent, and the good old BitcoinTalk can also share crypto on their respective websites. Sharing digital rewards online is also a way to pay authors for their original content without the need for intermediaries in between. This could become a good way to encourage millions of people who create unique content every day and don’t even get paid for it.
For example, viral memes get millions of shares, but how about creative people who spend their time to come up with brilliant ideas and then turn them into graphical and/or textual content? Ability to share crypto on social media brings a new model of the digital economy where, hopefully, copyright abuse will gradually become a thing of the past.
Blockchain social media
Facebook is perhaps the loudest case of the social media giant trying to implement their own cryptocurrency as means of sharing monetary value. Although, as we mentioned before some social media platforms already have the embedded service of sharing some of the most popular crypto and these services have become wildly popular.
Blockchain is also a technology that stretches beyond the digital money concept. With the help of the distributed, high-performance, and secure blockchain ledger, social media sites can implement some important technological advancements. For instance, Steem is built on top of the Delegated Proof of Stake (DPoS) consensus mechanism. In their case, users with larger stakes of tokens in the project possess more power than users with smaller stakes.
Digital payments without transfers to fiat could also become the next big thing for advertisers who wish to promote their services and products on social media. Meanwhile, regular users could pay in tokens for subscription services, digital goods in gaming apps, or even real products during online shopping. As cryptocurrency advocates often say, banking the unbanked.
Blockchain also makes it possible to embed the digital identity, or else self-sovereign identity (SSI) into a number of social media resources to secure access to personal accounts. This technology could also help to avoid deep fakes, spreading misinformation, encrypt personal messages, prove the content’s originality, improve online advertising without breaching privacy, and establish decentralized name servers.
As we can see from all the examples above, social media indeed have a great impact on the blockchain industry in general, and specifically, cryptocurrencies. Popular forums and discussion threads certainly increase the crypto industry in popularity and promote it to a wider variety of non-technical people.
This could lead to the further adoption of cryptocurrencies as a method of sharing values whether tied to corresponding real-life money or the so-called utility tokens which are meant to be used solely in the digital realm. Although, every relatively liquid crypto token is also being traded on exchange platforms which means that society in general still sees real value in cryptocurrency only in relation to its fiat counterparts.