$Degenerates
03/26/2024
gm everyone, and thanks for taking the time to check out this newsletter - if you missed my primer on Farcaster from the past week, check it out below:
Today, though, I want to dive a little bit more into $degen and why it’s been so instrumental in the success of Farcaster to date. As always, this is from the viewpoint of someone who joined just a bit over a month ago, so take what I say with a grain of salt, and always DYOR (that’s the teacher in me - always use multiple sources). It’s also worth mentioning that I have a bag, both from people kind enough to tip and also from buying on secondary.
What is $Degen, and Why Is It All Over My Feed?
As I mentioned in the previous newsletter, $degen is what seems to fuel (compliment, really) social interactions in the Farcaster space.
Degen is basically the currency of Farcaster that makes the world go round - people are constantly tipping it to each other - “lmao good post, 3000 $degen.” The cool thing is that you not only can receive tips from people, but you also get a use it or lose it allowance every day (if you qualify, which you can by reading the FAQ here) to give away. You don’t get to keep any leftovers (and it also doesn’t come from your own received tips), so it really incentivizes people to out, talk to others, and spread the love.
Low effort posts usually don’t get much $degen, so once again, if you’re just farming and people spot you, you’re gonna get rekt.
From one of the team members themselves:
If you use Reddit, you’re probably familiar with their karma system. This time around, imagine that the karma has a USD value, and it recently just broached .02 US.
Truthfully, I’m not generally a fan of “points systems,” as really it usually just means that we are the ones getting farmed for our liquidity instead of the other way around. The $degen team, however, has flipped that entirely on it’s head. These points have a value assigned already, along with a release schedule.
Not only that, but the main way that $degen is distributed is via tips from other users. There are LP contributors, of course, but even those rewards are getting reduced.
The beauty of this design is that instead of most of the token going to farmers and people with huge pockets like normal who can afford to dump ridiculous sums into LP positions, tokens are instead distributed by the community, for the community. The only way you are going to get $degen tips on Farcaster is if the people like your content, creations, or whatever it is you have to say. The result is two fold:
The distribution goes to people who are actively contributing to the ecosystem instead of detracting from it (deserving)
Most people who receive these tips are community members already who believe not only in the $degen ecosystem, but Farcaster/Base itself - instead of people farming and dumping, most people I know who receive tips hold and accumulate because they believe in the mission
How Do I Get a Tipping Allowance?
If you’re at this point, you probably are wondering how you get to participate in the fun. Getting $degen is one thing, but giving $degen is even better. Importantly, you need to meet this most basic criteria to start:
You can also check out this Dune link for the actual formula to increasing your tip allowance.
Every day, you get an allotment of $degen (once you’re eligible) that’s use it or lose it. It doesn’t come from your own received tips - it resets every 24 hours. Really, you should make your personal mission to zero out your allowance every day - otherwise, you’re burning free money that could go to someone deserving.
For more detailed information, however, I highly recommend checking out Wake’s Tipping Guide below. This is basically the holy grail of $degen tipping information.
Overall, $degen is an extremely unique coin that many are treating as a proxy bet on the entire Base/Farcaster ecosystem - and you can probably see why. The recent price action supports this as well. Distributed in possibly the most fair and mission-aligned method you could think of, I’m extremely bullish on the future of $degen, and try to add whenever I can (and sometimes it costs me, please don’t let me trade anymore).
I hope this newsletter helped you understand the $degen ecosystem a little bit better - but you can always feel free to reach out with any questions!
BFG