This week we launched our new Bitcoin Market Journal Reward Token, kicking off the next wave of growth for the crypto industry.
Here’s how it works: Our Premium members now get 10 BMJ tokens deposited into their crypto wallet every month, which they can redeem for real-world rewards you can’t get anywhere else. (Check out the prizes here.)
On Monday, I explained our mission in the BMJ: to the next 100 million crypto investors. The BMJ Rewards Token is not an investment – it’s a loyalty program – but it introduces people to cryptocurrency in the easiest way possible and encourages long-term loyalty.
On Tuesday I explained how BMJ differs from other tokens: it is only minted when we receive real income from our Premium membership. We have developed a new metric – Real Earned Income (RRE) – which gives the cryptocurrency industry a new level of transparency and trust.
On Wednesday, I explained the journey to launch the BMJ token, including why we chose to build directly on Ethereum – not another blockchain or L2 solution – you can enjoy the joy of finding new tokens in your wallet every month, even by paying gas fees for members.
I talked about Thursday qualities good loyalty programs, and how we can adapt them to the crypto industry. We talked about the Loyalty Flywheel and how reinvesting more benefits leads to more business – building a crypto community along the way.
I will talk about today why this is the start of the next big cryptocurrencyand why the BMJ Reward Token is uniquely positioned to lead. If you’re a premium subscriber, wait: you’re part of something really good.
The Destruction of Trust and the Rise of Loyalty
It’s no secret that many are skeptical of the cryptocurrency industry.
2022 didn’t help. Meltdowns. Explosions. Bankruptcies. And the ongoing trial of Sam Bankman-Fried, which will consume the news media for 2023 and beyond. (Prediction: There will be a Netflix documentary.)
How can we restore trust as an industry?
It is the first way peg tokens to real value. Other than stablecoins, most tokens are backed by nothing more than people’s trust. During market turmoil, we have seen that belief will go first, followed by the token price.
Stablecoins were a real innovation because they were backed by real dollars – at least good ones. Stablecoins have flourished as a result and will likely be the first crypto asset to be regulated and properly integrated into the traditional financial system. (Another prediction.)
BMJ token (and hopefully other crypto loyalty programs will follow). minted only when real income is earned. This is different from stablecoins – we don’t hold the money back – but it often mirrors loyalty programs today, such as frequent flyer programs or Starbucks Rewards.
The second way to restore trust give tokens a real benefit. Make them do something. Investors are rooting for tokens sitting in their wallets hoping that the “price will go up”. The BMJ Reward Token is something different: you can redeem it for real-world rewards.
This gives reward tokens a huge advantage over other cryptocurrencies. If designed correctly, you don’t live under the dark cloud of fear that they might be “unregistered security”. Loyalty tokens are digital loyalty points, period. Like Delta SkyMiles. Just like Starbucks Rewards.
That’s the difference utility: they’re not just tokens you buy hoping the price will go up based on the efforts of others. These are tokens provided to you as a paying customer that you can collect and redeem for valuable real-world rewards.
Calm down, Howey.
Real prizes cost money
Take a typical credit card rewards program: you earn one reward point for every dollar spent. Then you can redeem those reward points for free flights, hotel stays, or even — breathe! – balance of money.
These rewards, of course, cost real money.
Again, with crypto loyalty programs, we build real business the recipient real income to prepare real products and services. That means all the great, high-quality merchandise on our rewards page costs real money… just like credit card rewards for the credit card company.
But where does this money come from?
For credit card companies, it’s hidden in interest and fees. Foolish consumers who don’t pay off their credit card debt in full each month end up paying interest and their pays interest your credit card rewards.
There is enough of a profit margin for your local coffee shop that they can give you a free coffee after buying ten (probably because you also bought ten pastries or muffins).
For those building their own crypto rewards programs, you can solve the “real rewards cost real money” problem in several ways:
- You can mention the original product or (more likely) the premium product, so you still make a profit;
- You can offer digital downloads that are essentially free to perform;
- You can allocate part of the costs as a marketing expense (good loyalty programs will reduce customer churn and increase customer stickiness);
- You can set the percentage of reward tokens that will not be redeemed and price accordingly.
On the subject of unused tokens, here is a valuable data point. When we did our initial token mint for the BMJ token, we noticed that there were a number of users who never closed their MetaMask wallets. They paid real money for premium membership (RRE) but never claimed the tokens.
We returned these tokens – approximately 17,680 – to our main wallet, which we call “BMJ Reserves”. The idea is that these could potentially be given to Premium members in the future. It’s a war chest that allows you to reinvest in the program to keep the loyalty flywheel going even faster.
Remember: The purpose of rewards programs is to increase customer loyalty. Companies should treat these like marketing or community building efforts: the long-term benefits are increased customer happiness, reduced attrition and more sales. (More benefits = more work.)
If you’ve been in this industry for a while, you see that it goes through cycles.
The easiest way to see these cycles is to look at the price of bitcoin:
But what happens behind the scenes looks more like this:
Because every drop in the circuit washes away the weakness. He gets rid of gamblers and degens and opens the doors of new buildings.
Recessions aren’t fun, but they’re valuable because they force us to focus on what’s really important. To innovate. To hurry. To find new solutions.
Up markets are for speculators and down markets are for builders. To simplify the cryptocurrency market cycles, this is what it looks like:
Every bear market in cryptocurrency has spawned some new innovation that fuels the next bull market, whether it’s smart contract platforms, DeFi or NFTs. The next wave of growth, we believe, will be fueled by premium tokens.
I have outlined the principles we used to create our BMJ Reward Token, which will serve as a model for future projects. Principles such as transparency and trust. Real income was earned. Real world rewards. And above all, thinking about blockchains as a business.
Thanks to all our Premium subscribers, especially those who have been with us since day 1. The future will be more rewarding than any of us can imagine.