Earlier this month, Meta – formerly known as Facebook – announced plans to launch its own digital currency. Dubbed after founder Mark Zuckerberg, Zuck Bucks will be an in-app token used across social media platforms from Meta, Facebook, and Instagram.
Zuck Bucks could take various forms, including “social tokens” and “reputation tokens” for users of the platform. These would encourage people to actively create and engage with content on social media, and influencers would receive “creative coins” as rewards for their popular posts.
Although digital, Zuck Bucks will not be blockchain-based. They will be similar to currencies used to purchase items in games such as Fortnite and League of Legends. This is likely due to the regulatory hurdles Meta faced during its first foray into the crypto space.
In 2019, Meta was working on Libra, a stablecoin to help simplify online transactions. He planned to integrate payment systems into WhatsApp and Facebook Messenger, through which people could conduct transactions at a lower cost.
Over the next two years, the project came under intense scrutiny from regulators such as the United States Federal Reserve. Concerns about money laundering, consumer protection and privacy were cited until Meta finally shut down Libra earlier this year.
Although the Zuck Bucks are created for a different purpose – to aid Meta’s metaverse economy – it’s hard to imagine they’ll fare any better than their predecessor.
A lack of innovation
For more than a decade, Reddit users have been awarded “Karma” points every time one of their posts or comments is updated. These points serve little purpose and serve primarily as a status symbol. There is a small proportion of users who are proud of their accumulated Karma, but for the most part this is not the case.
From what we know about the Zuck Bucks so far, they aren’t very incentivizing either.
For most people in the crypto space, digital currencies serve as an investment. Whether they are part of a game economy or a metaverse, the ultimate goal is to make monetary gains from them.
It doesn’t look like Zuck Bucks will provide such an opportunity. For starters, they won’t be freely tradable. If Zuck Bucks were to be paired with fiat currency or made tradable on an exchange, Meta would face the same regulatory scrutiny it did with Libra.
The main purpose of these tokens would be to buy assets in the metaverse of Meta. These assets would only be valued in Zuck Bucks, and even if their value were to appreciate, holders would not be able to convert their profits into another currency.
While trying to ride the blockchain wave, Meta seems to be pushing an idea that has been around for a long time and is unrelated. Zuck Bucks are much more closely tied to Farmville Farm Coins than Bitcoin or Ethereum.
On Farmville, farm coins can be earned by playing the game or purchased with real money. They can then be used to purchase virtual assets such as tractors or animals. These assets are for in-game utility only and cannot be exchanged for real money.
This seems to be the premise on which Zuck Bucks will also operate – a new revenue stream for Meta, with no real benefit to its users.
Decentralization, but not really
Since Facebook’s rebranding, Meta has co-opted terms popularized by Web3 and violated their core principles.
The appeal of a metaverse begins with decentralization. People are attracted to the idea that they can own virtual assets and trade them freely. Meta’s Horizon Worlds completely ignores this.
In its virtual asset sale rollout plan, Horizon Worlds will charge a fee of up to 47.5%. Additionally, it is likely that these assets will not be tradable outside of Horizon World’s closed ecosystem.
To put things into perspective, assets from decentralized metaverses such as The Sandbox and Decentraland can be traded on NFT marketplaces. The most popular marketplace, OpenSea, charges a fee of just 2.5%.
Meta’s approach to digital currency seems similar.
Blockchain games such as Axie Infinity and Alien Worlds operate on play-to-win models. They are built on the idea that users are rewarded for their time and share in the profits. Each of these games has utility tokens that can be exchanged for fiat currency.
With Zuck Bucks, Meta plans to gamify its social media platforms. However, it looks like the company will keep the profits for itself.
From hidden likes to reputation tokens
A year ago, Instagram and Facebook rolled out the option to hide likes. The goal was to ease the pressure people felt when using the platform. Mental health issues, especially among younger users, were cited as a reason for the decision.
Now, driven by financial motivations, Meta seems to be heading in the opposite direction.
Through Zuck Bucks, they’re trying to make social media likes and engagement more valuable than ever. Online popularity is quantified in the form of “reputation tokens”, which comes with a number of negative implications.
On the one hand, we have a social media addiction. As if it weren’t already at disturbing heights, Meta wants users to spend even more time on their platforms.
In addition, the quality of shared content may suffer. If Zuck Bucks are awarded to people who post more frequently, there will be a meaningless incentive to spam.
Users will form groups and cultivate Zuck Bucks by interacting with others’ posts. The user experience on Facebook and Instagram would inevitably take a hit as comment sections became even more unbearable.
Meta might benefit from the hype surrounding Zuck Bucks’ initial launch, but it seems unlikely that they’ll see long-term success from the concept as it stands.
Featured Image Credit: Engadget
Also read: Facebook changes parent company name to Meta as part of ‘metaverse’ vision