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BitClout = The Best Opportunity You've Never Heard Of

BitClout = The Best Opportunity You've Never Heard Of

📈 BitClout = The Best Opportunity You've Never Heard Of

April 08, 2021

Brainstorms Issue #24

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BitClout = Big Opportunity

A lot has been happening in the crypto space as of late… like a lot.

You’ve got major tech players pumping money into Bitcoin.

NFTs (non-fungible tokens) are changing the way artists, musicians, and creators monetize their work.

And now there’s a new kid on the block, BitClout - which is getting tons of hype.

This week, we’ll explore:

What exactly is BitClout?
Where do I see opportunity?
How you can execute on the opportunity?

Oh, and I think I need to say this 🤷👇

Disclaimer: Nothing I say is intended to be financial advice, but merely my own opinion. Do your own research and invest at your own risk.

First things first, what is BitClout?

Simple answer:

BitClout is like a stock exchange for people.

Not simple answer:

BitClout is a new type of social network that lets you speculate on people and posts with real money, and it’s built from the ground up as its own custom blockchain.

Let me break it down - I, Keevin, have a BitClout account. By having a BitClout account, I get a “Creator Coin”, which is a publicly-traded token (currently trading at $7.47).

Note: Anyone can create a BitClout account and get a Creator Coin.

Now, if someone purchases my coin, the price goes up. If someone sells off my coin, the price goes down.

Just like the stock market, the buying and selling of my coin is directly correlated with people’s belief in me... Or my clout.

As the owner of my Creator Coin, I get paid every time someone buys my coin. The default amount 10%, but each creator can set their own percentage.

Essentially, this is a way for you to bet on people rather than companies- which I find incredibly interesting.

But what do you get by investing in someone?

The answer depends… right now, there are a few ways a buyer can benefit from purchasing a Creator Coin:

By holding a Creator’s Coin you could get private access to the creator, premium content from the creator, sponsored posts, and more. Ultimately, it’s up to the creator to decide what benefits they want to give their shareholders. It’s very similar to a creator’s Patreon rewards.
A more cynical outlook is that people are just buying Creator Coins in hopes that they can sell them at a higher price to someone else at some point in the future. In finance, this is known as the Greater Fool Theory. If this is true, there’s still money to be made - it just doesn’t bode well for the long-term success of BitClout.

So is BitClout legit?

Alright, this is the part where I give some disclaimers.

Let’s be honest, it’s way too early for anyone to know if BitClout is going to be the next big thing.

The platform was launched less than 1 month ago and has been in private beta for the majority of that time.

Here are some valid criticisms of the platform that are worth mentioning:

Money only flows one way - right now, you can only put money on the platform… you can’t take it out. This is one of the biggest criticisms of the platform and understandably so - it gives off real “scam” vibes. This means, “gains” that you make from investing are just paper gains.
Questionable launch strategy - BitClout launched by creating Creator Coins out of the top 15,000 Twitter profiles without getting permission from the account owners. This strategy allowed BitClout to get buy-in from some influencers early on, but others weren’t happy about it.
It’s unregulated - Unlike the stock market, BitClout doesn’t have any regulatory body overseeing it. While this allows them to move quickly, it also opens the doors for pump and dumps and other schemes which could result in people losing a lot of money (hint hint Jordan Belfort).

The saving grace here is that BitClout is backed by top-tier investors - so it’s unlikely that it’s a total scam.

Note: I glossed over a lot of details for the sake of brevity. For more information on BitClout I recommend checking out this video, this video, and reading this one-pager.

With that out of the way, let’s talk about some opportunities.

With any new platform, there’s an incredible amount of upside that comes with being an early user.

The easiest and most obvious opportunity that exists is just participating and investing in creators on the platform. Without getting too deep into the math (page 5+ 6), BitClout disproportionately rewards early backers for their contributions to creators.

That said, I believe there’s a bigger opportunity taking the “sell pickaxes during a gold rush” approach.

Here are a few of my favorites:

Note: There’s a lot of platform risk in building any of these ideas. i.e. BitClout may release any of these ideas as features.

Creator Coin Investing Tips: As mentioned above, there’s huge upside to getting in early on under-the-radar creators. Unfortunately, the discovery feature on BitClout is lacking - so it’s really hard to find new creators. If someone created a newsletter or information site that featured new creators worth investing in, gave trading tips, and helped me make better-investing decisions, I’d pay money for it.
Creator Coin Price Tracking: I’d love to see the price history of specific creator coins over time. How has the coin performed over the last month? The last week? This information isn’t accessible right now but having it would help me see trend lines. I did find BitClout Pulse, which appears to be working on this.
BitClout ETFs: As BitClout continues to grow, the creators on the platform will become more and more diverse. A number of investment strategies are being used right now, but there could be an opportunity to create an ETF that invests in creator segments or defined audiences. E.g. ETF for musicians, artists, pornstars etc…
BitClout Management Tools: As with every social media platform, it takes time to create content, engage with followers, and participate in conversations. There are literally dozens of tools (Buffer, HypeFury, HootSuite) that help you manage your Twitter, Instagram, FB, etc… Right now, no one is doing this for BitClout. Frankly, I think this is the best opportunity in the BitClout space.
Bonus - BitClout for Pornstars: If you’ve been following Brainstorms for a while, you know I love the OnlyFans business model… BitClout + OnlyFans, say no more.

Note: I found BitClout Hunt and this excel spreadsheet that track all the projects currently being built on top of BitClout. Worth checking out.

Alright, so there’s loads of opportunity right now, but how would I pounce on this?

Position yourself as an expert: To be honest, BitClout is so new that no one really knows what the hell is going on. It won’t take you long to become a thought leader in the space and make a name for yourself. Start a newsletter/blog and promote your content in relevant FB Groups, on Twitter, and on Reddit with the goal of funneling people into a community (Step 2)
Build a community: Regardless of what path you take, I’d build a community of BitClout enthusiasts. Given the platform is so new, there’s likely going to be competitors cropping up quickly, but owning a community will give you a distribution advantage and direct access to potential customers.
Build an MVP: Once you’ve got a community of a few dozen people, I’d start doing customer discovery interviews. Ask about what pain points people have, what they wish existed, and how they are currently using the platform. This should make it crystal clear what you need to build. From there, you should be able to test out an MVP with a few people from your group to get feedback.

Thanks for reading - now get out there and build it!

Catch ya next week,

Keevin ✌

PS want more Brainstorms? Check out all the past issues here.