What Is Social Mining and How Can It Benefit You?

Nowadays, competition between social media platforms is rife. As a result, some platforms have come up with innovative ways to encourage engagement, such as social mining. Social mining takes advantage of blockchain technology to make reward systems more lucrative.

This innovation has the potential to transform how social media users engage online, especially in the modern Web3 era. But how does social mining work, and where can you find it right now?

What Is Social Mining?

In terms of crypto, social mining refers to the mechanism where individuals on a social media platform earn tokens or rewards based on their activity or contribution to the community. It involves leveraging blockchain technology to incentivize content generation, user participation, engagement, and influence in the network.

Social media platforms have had various types of reward systems, from like-based rewards on Facebook, Twitter, and Instagram, to app and workplace gamification and achievement rewards on LinkedIn and Stack Overflow.

However, these systems didn’t offer any direct monetary value to the users. With blockchain technology, social media participation can be turned into money through token-based rewarding systems.

How Does Social Mining Work?

Social mining (not to be confused with social media data mining) typically works on blockchain-enhanced social media platforms. Users are encouraged to create, share and engage with content and their activity is tracked, verified, and tokenized using smart contracts. Essentially, the reward system is facilitated as follows:

• Tracking user actions: An inbuilt system is used to monitor and track activities such as content creation, shares, comments, and reactions within the platform. This data is used for the validation of activities that facilitates reward allocation.
• Scoring and reward calculation: Scores or rankings are then assigned to users based on their contribution and engagement levels. These scores are then used to calculate the rewards earned by each user
• Token Allocation: Smart contracts define the rules used in determining the criteria for earning tokens, how many tickets will be distributed to every active user in the pool, and the distribution mechanism.
• Token Distribution: Once the tokens are allocated, smart contracts distribute the tokens to eligible users. The tokens are sent directly to the users’ wallets, ensuring transparency, immutability, and security of the transaction.
• Redemption and Exchange: Once users have tokens in their wallets they can redeem them either by exchanging them for other cryptocurrencies in exchange platforms, or using them within the platform for accessing premium features or buying goods and services.
• Governance and Updates: In addition to the monetary value of these tokens, users are allowed to participate in the decision-making process regarding the platform’s future. Users with enough tokens can propose changes and influence the platform’s developmental progress.

Social mining incentivizes interactions and content creation by creating a sense of ownership among users. This fosters community engagement, promotes organic growth, and helps the platform and other community-driven initiatives achieve their objectives. In return, users access actual monetary value for their time and contribution to the platform.

Social Mining Projects

Several social media platforms have implemented social mining as a core component of their ecosystems. Here are some examples:

1. Steemit

Steemit is a social media platform built on the Steem blockchain that incorporates a reward system to incentivize content creation and engagement within it. Users earn STEEM tokens by posting, commenting, and up-voting content. The rewards are distributed based on the influence and engagement each user generates.

Users who want to use the STEEM they’ve earned on the platform can send them to an exchange platform trade it for another cryptocurrency and then convert it to fiat currency. As of mid-June 2023, Steem ranked in the top 300 list of cryptocurrencies by market capitalization, and its tokens were valued at $0.156 each.

2. HIVE

HIVE is a decentralized social media platform that came about from a community-led hard fork of Steem. This fork followed weeks of conflict between Justin Sun (founder of Tron) and the Steem community. Hive uses social mining to incentivize engagement while providing users with more control over their content and fostering a censorship-resistant environment.

The Hive ecosystem is currently made up of hundreds of Web3 apps, including Splinterlands and PeakD. Meanwhile, the Hive token was valued at $0.29 as of mid-June 2023, with a market capitalization that ranks in the top 175 list of cryptocurrencies, outperforming its predecessor, Steemit.

3. YUP

YUP is a web3 social media platform that brings together the best of various social media platforms in one unified feed. Members use a single app to curate and share content effortlessly from various apps including Twitter and Farcaster. Users can also create bookmarks of anything they find interesting and share them with other members of the platform.

YUP is built on the Yup protocol, wherein decisions and actions are collectively agreed upon by a community of active contributors. In return, these contributors are rewarded with YUP tokens as an incentive for their valuable participation. The members can voluntarily exchange their tokens for other cryptocurrencies on Uniswap.

4. Reddit

You’ve obviously heard of Reddit, as it is referred to as the front page of the internet. The social news aggregation, content rating, and discussion website has always had a reward system made up of Karma, up-votes, and awards. Users who make meaningful and influential contributions are rewarded for their effort.

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But in 2020, Reddit went a notch higher with the introduction of Reddit Moons. Unlike Karma credits which have no monetary value, Reddit Moons are ERC-20 tokens built on the Arbitrum layer-2 solution, that have monetary value. They’re distributed among active members of a specific subreddit, known as r/CryptoCurrency, and can be redeemed through the purchase of premium membership or Reddit Coins.

Benefits and Concerns of Social Mining

As the internet evolves, social mining is likely to become a major feature in social media. More platforms are likely to integrate rewarding systems with actual monetary value to incentivize content creation and activity as they compete for people’s attention. But there are pros and cons to be considered here.

There are two core benefits of social mining; for the platform and users:

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1. Community growth: Social mining encourages users to be active on a social media platform. As users are rewarded for their contributions, they are more likely to create high-quality content, participate in discussions, and collaborate with others. The social media platform in return benefits from increased activity which creates opportunities for monetization.
2. Empowerment and ownership: To the users, social mining shifts the power dynamics of social media by giving them a stake in the platform and a sense of ownership. Therefore, they can extract value from the time spent on social media. It also encourages a more decentralized and user-centric approach to social media, promoting a fairer and more inclusive ecosystem.

On the other hand, the design of social mining systems creates a number of concerns:

1. Gaming of the system: Users are likely to manipulate the social mining system to earn rewards without genuine engagement or contribution. This could involve creating fake accounts or artificially inflating engagement metrics. Such actions undermine the integrity of the reward distribution process.
2. Privacy and data ownership: Social mining platforms collect and analyze user data to determine token allocation. This raises questions about the privacy and security of the personal data collected as users have limited control over how it’s used by the platform.
3. Token value changes: Usually, the crypto tokens rewarded in social mining are of low value. But this value, however low, is volatile and subject to change, as are almost all cryptocurrencies. Today a token might be worth something, and tomorrow, its value may crash. This makes it a risky asset to own.

Overall, social mining’s primary purpose is to improve socialization among members. While it does well in encouraging people to interact, it also has the potential to attract bad actors and course trust issues. Only systems designed to counter these challenges can withstand the test of time.

Social Mining Allows Platforms to Give Back

Social mining can be considered a potentially positive use of cryptocurrency as it incentivizes user engagement, empowers users, and fosters community growth. However, the effectiveness of social mining depends on whether a platform addresses concerns related to manipulation and privacy, among other issues. A well-designed social mining system that prioritizes fairness, transparency, and user ownership can harness the benefits of cryptocurrency while mitigating the risks.