To show our gratitude, we have partnered with DAO Maker — creators of the renowned “Social Mining” system—to increase token utility, maximize community efforts, and reward all who add value to the Ferrum Network ecosystem.
Intro to Social Mining
Put simply, Social Mining is a sustainable, community-driven rewards system designed to reward those who add value to Ferrum Network. But it is not an airdrop or bounty. It is an advanced rewards system designed to accurately reflect the value each person contributes to the ecosystem and reward them accordingly.
Top projects such as LTO and Elrond have already demonstrated the power and effectiveness of Social Mining. We are honored to be working with the DAO Maker team to bring Social Mining to Ferrum Network.
Dashboard for the Social Mining Platform
In this article we provide an overview of Social Mining, why we love it, and how YOU can benefit from it.
The Free-Rider Problem and the Old, Stale Approaches
In economic theory, the Free-Rider Problem describes a situation where one person’s efforts benefits the entire system, thus reducing the likelihood that other market participants will put in their own efforts.
In other words, when someone else’s work benefits others, the other participants have no interest in contributing themselves. Think about it. Would you put in as much effort at work if you knew you would be paid based on the efforts of your colleagues?
This problem also exists in token ecosystems where a passive token holder benefits from the efforts of marketers, influencers, the team, developers, and active community members, and has little incentive to put in his own efforts.
Many projects use bounties or airdrops to reward what they believe to be value-added actions, such as “liking” a post on social media or referring people to a Telegram channel. The problem is that one-time rewards don’t properly incentivize valuable behavior. Airdrops become spam and can attract the wrong type of supports. Moreover, the manual work encouraged by airdrops and bounties are not scalable and are too often abused by bots. Finally, one-time rewards are not sustainable, as most of those tokens are immediately sold as the “hunter” moves into the next project.
But what if there was a community-driven approach to create an organic community of long-term holders and contributors…?
Social Mining and How it Solves the Free-Rider Problem
By leveraging token rewards, a project can incentivize everyone to add value to the ecosystem and be rewarded in the process. Here’s how it works.
Ferrum Network will allocate FRM tokens to reward and stimulate community efforts. But the project does not dictate how these tokens are distributed in the form of one-time rewards, the community itself decides how those tokens will be distributed based on the value of other’s contributions, and does so on a continuous basis.
Putting Power in the Hands of the FRM Holders and Social Miners
Participants in this system (participation is as easy as linking your social media accounts to the Social Mining platform), are given immediate power. Not only are they rewarded for creating value-added content, they now have the power to reward others for their contributions. The voting power of each member is based on their individual contributions. The more you contribute, the more voting power you have and the more rewards you receive.
In other words, Social Mining creates an system where the participating community members reward other participants based on the value they provide to Ferrum Network. Community driven and decentralized, the way ICOs are supposed to be.
Did a community member make an amazing YouTube video about Ferrum, or did a Tweet get a lot of exposure? Social Mining allows participants to up-vote the best content to incentivize higher-quality work. Up-voting the best content is not only good for FRM holders, but it also increases your own validation rewards and monthly payout.
DAO Maker’s Social Mining ensures that supply dilution only takes place when token holders add positive value to the ecosystem. Moreover, because Social Mining encourages holding FRM by offering greater voting power and monthly rewards to hodlers, it mitigates the impact of any supply rate growth.
“Social Mining turns the typical community of passive investors into a decentralized engine of systematic value addition, commanded by the community itself.” — Hatu, CMO of DAO Maker
Adding Economic Value + Social Value = Monthly FRM Rewards
The system is relatively simple: the most value you add and the more FRM you hold, the more FRM rewards you earn each month.
“Value” can be defined in many ways, from creating and sharing content, using and referring our products, social media activity, to more complex tasks such as contributing to our GitHub or translating an article.
In determining the monthly reward, the system calculates a variety of critical economic and social factors such as:
- Time users hold their initially invested tokens.
- Time users hold their earned engagement tokens.
- The total amount of tokens held by registered users.
- Current user community level.
- Monthly earned points based on value-added contributions
Throughout the month you will accrue Reputation Points, which in addition to the amount of FRM you are holding, will determine your monthly payout of FRM.
“The result of such a system is that higher level members will be more knowledgeable, more loyal, but will also be holding a higher amount of tokens. Higher ranked users will earn more benefits and responsibility, but also have a higher stake. They are disincentivized to cause problems, but incentivized to make use of user influence and reputation to help the project, hence growing token value.” — Chris, CEO of DAO Maker
How to Get Involved
In the coming days, we will provide the Ferrum Network Social Mining sign-up link, so you can link you social media accounts, start adding value and begin earning rewards!
We will announce the detailed breakdown of the reward system, which are designed to incentivize value-added behavior. Expect to see generous rewards based around using our products and growing our ecosystem…
We will follow up shortly with the number of points each action offers, how to “level up” and earn more FRM, and much much more.
And don’t forget to stay tuned for the ICO announcement date and info on how YOU can participate!
Thank you for your continued support of Ferrum Network.
Very truly yours,
The Ferrum Network Team
Bitcoin Talk: http://bitcointalk.ferrum.network