BitClout Bonding Curve Math

BitClout is a social media cryptocurrency platform where creator coins follow a mathematical bonding curve that determines their value. Here's how the economics work:

Core Economics

• Value doubles with every 1M coins sold
• Currently ~$172M invested in creator coins
• Platform has 1.1-2M coins in circulation
• Expected to reach 10-19M coins total
• Potential for 7 more value doublings from current state

Creator Earnings Structure

• Creators can set percentage of coin supply they automatically receive
  • Recommended setting is 10%
  • Can set to 0% and buy own coins instead
• Only paid on net coin sales
  • If someone buys 100 coins then sells 100, creator earns nothing
  • Timeframe for calculating net sales is unclear (could be daily/monthly/yearly)

Value Mechanics

• To earn $100 as creator:
  • Need 132 coins sold
  • Each coin worth ~$7,600
  • Requires $339,000 total investment from buyers
• Price Movement:
  • Selling 13 coins (10%) reduces price from $7,600 to $6,200
  • 20% value drop from selling just 10% of coins
  • Exponential decrease mirrors exponential increase

Investment Structure

• 2M coins set aside pre-launch for founders/investors
• Potential value of $534B when 10M coins issued
• VCs heavily invested due to exponential growth potential
• Creators can pump and dump their own coins
  • Buy cheap initially
  • Sell high to later investors
  • Risks reputation damage

Key Concerns

• Unclear how creator payments work when coins are sold
• Large gap between current circulation and target
• Reputation risks for creators who manipulate prices
• Exponential price drops can trap later investors