"The Ownership Economy 2022 – Variant: Foucault and Social Media in the Virtual Panopticon"

"The Ownership Economy 2022 – Variant: Foucault and Social Media in the Virtual Panopticon"

In today's digital landscape, the ownership economy has emerged as a powerful force, offering builders the opportunity to leverage market incentives and create positive social change through the distribution of wealth-building assets. This concept revolves around transforming users into owners, with more than 15,000 projects in the ownership economy ranging from user-owned financial markets to user-owned social networks and digital assets. The market capitalization of tokens tracked by CoinMarketCap has reached $1.76 trillion as of April 2022, indicating the growing influence of the ownership economy.

While user ownership can jumpstart growth, sustaining it poses a greater challenge. Simply giving users ownership is not enough to ensure long-term success. Tokens can capture user attention and drive initial adoption, but strong product-market fit is necessary to sustain usage. Additionally, liquidity remains a key motivator for users in choosing one marketplace over another. It is important to consider whether ownership actually crowds out intrinsic incentives, potentially leading to more transactional and temporary user engagement. To preserve intrinsic motivation, token incentives should be optimized in terms of timing, magnitude, eligibility, and other factors.

New token distribution designs are playing a crucial role in boosting user loyalty. Axie Infinity's player retention has remained strong over time, indicating that engagement is not solely driven by novelty. Traditional liquidity mining programs have often led to short-term participation, with a significant portion of users exiting within the first few days. However, a new generation of token incentives is emphasizing contributor growth and long-term engagement. Voting escrow contracts and vesting mechanisms are being introduced to encourage users to remain involved in projects, fostering loyalty and sustainability.

User ownership also fosters richer ecosystems of projects and contributors. The permissionless nature of blockchain projects attracts users, creators, and developers, who collaborate and build around these projects. CC0 NFT projects, in particular, extend the definition of ownership by allowing free use of assets, stimulating building, creation, and collaboration. Shared ownership reinforces network effects and creates a disincentive for users to switch to other blockchains, leading to the growth and development of robust ecosystems.

In the realm of social media, the insights of French philosopher Michel Foucault shed light on how it affects us psychologically. Social media goes beyond information exchange; it facilitates identity formation and subjectivation. Sharing content on social media is a performative act, done in the presence of a crowd. The act of sharing is shaped by the self-reflexive structure of social media, where users select and frame content to please and impress a specific audience. This performative aspect is tied to the existential marker of identity, as what users share represents who they are.

Foucault's concept of the Panopticon, a prison where prisoners are perpetually exposed to the gaze of unseen guards, can be applied to social media. In the virtual Panopticon of social media, users are both guards and prisoners, watching and implicitly judging one another as they share content. The crowd becomes the source of recognition and affirmation, fulfilling deep psychological needs. Despite the risk of being watched and judged, the pleasure of being affirmed by the crowd drives users to continually share.

Combining the ownership economy and Foucault's insights, we can draw actionable advice for users and builders in the digital landscape:

1. Focus on strong product-market fit: While user ownership can jumpstart growth, sustaining it requires a product that solves a widespread need for users. Tokens should be coupled with a product that captures user attention and provides liquidity to ensure long-term usage.

2. Design token incentives for long-term engagement: New token distribution designs should prioritize contributor growth and loyalty. Introduce mechanisms such as voting escrow contracts and vesting to encourage users to remain involved in projects and foster sustainability.

3. Foster collaboration and building in ecosystems: Shared ownership reinforces network effects and creates a disincentive for users to switch to other platforms or blockchains. Encourage collaboration, creation, and free use of assets to stimulate growth and development within ecosystems.

In conclusion, the ownership economy and social media have become intertwined in the digital landscape. The ownership economy offers builders the opportunity to leverage market incentives and create positive social change through user ownership. Meanwhile, social media functions as a virtual Panopticon, where users perform their identity and seek recognition from the crowd. By understanding these dynamics and implementing actionable advice, users and builders can navigate the evolving landscape of the ownership economy and social media in a way that maximizes engagement, sustainability, and value creation.