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Illustration: Annelise Capossela/Axios

Nearly every major social platform has recently introduced some form of tipping, allowing users to directly support their favorite personalities in real time.

Why it matters: Creators have been fueling engagement on social media platforms for years, but only now that the creator economy is maturing are they actually able to make money directly from their fans.

Driving the news:

  • Twitter is working on adding a “Tip Jar” feature within @TwitterSpaces and on users’ main profiles, software engineer Jane Manchun Wong discovered this week. This is in addition to its new "Super Follows" feature, which allows users to charge followers for special content.
  • Clubhouse launched a payments feature at the start of the month to help audio creators generate revenue from the platform. 
  • Facebook said in March it would expand its “Stars” virtual currency, which lets fans reward video and game creators directly for their content.
  • Instagram late last year launched "Badges," a virtual gift that users can buy during livestreams to show their support for the creator in real time.
  • YouTube has been experimenting with various tipping features including “applause,” and “Super Chats” for years.

Behind the trend: The popularity and availability of payment platforms such as Venmo, CashApp and Stripe are making it easier for tech companies to enable peer-to-peer payments on their platforms. 

Be smart: Gamers and adult entertainment platforms have been ahead of this trend for years.

  • Twitch and Caffeine have long used tip-like features to drive engagement between gamers and their fans.
  • OnlyFans has exploded in popularity over the past year, in large part due to the fact that its direct payment features has created a viable income stream for many of its creators.

The big picture: For creators, getting money from users directly is critical because platforms are not financially incentivized to pay out most people directly.

  • Attempts at social media networks that pay people for their content have struggled to gain traction in the past.
  • While most of the Big Tech giants have launched creator funds in the past few months, those opportunities are still limited to the most viral performers, not smaller or niche creators.

Our thought bubble: Digital tipping will differ fundamentally from tipping in the real-world services industry, like bartending or taxi cab driving, because digital tipping often accounts for the entire livelihood of online creators.

What to watch: Following in the social media giants' footsteps, music giants are now also getting in on the trend, which is significant given that musicians have for years struggled to make money directly from fans.

  • SoundCloud is planning to introduce a direct payments between fans and artists through its platform, per Billboard.
  • Spotify in August rolled out a new feature that allows fans to pay musicians directly.

Go deeper

Aug 1, 2021 - Technology

Zoom agrees to pay $85M to settle privacy suit

Photo: Tiffany Hagler-Geard/Bloomberg via Getty Images

Zoom agreed to pay $85 million and fortify its privacy features to settle a lawsuit claiming the company violated users' privacy rights by sharing data with tech companies and allowing hackers to jump into zoom calls, Reuters reports.

Why it matters: Zoom became many people's go-to platform for both work and social interaction during the pandemic, but this isn't the first time the platform has been asked to step up its privacy measures.

Updated 4 hours ago - Politics & Policy

Giuliani associate Lev Parnas convicted of campaign finance crimes

Lev Parnas, a former associate of then-President Donald Trump’s personal lawyer Rudy Giuliani. Photo: Stefani Reynolds/Bloomberg via Getty Images

Florida businessman Lev Parnas was convicted Friday on charges of conspiracy to make foreign contributions to political campaigns, according to multiple outlets.

Why it matters: Prosecutors said Parnas, then an associate of former President Donald Trump's personal lawyer Rudy Giuliani, funneled over $150,000 from a Russian businessman into U.S. campaigns as part of an effort to land licenses in the U.S.'s legal cannabis industry.

Supreme Court agrees to hear challenges to Texas abortion law

Photo: Saul Loeb/AFP via Getty Images

The Supreme Court on Friday agreed to hear two cases challenging Texas' abortion law, which bans the procedure as soon as six weeks into pregnancy, but left the law in place in the meantime.

Why it matters: The court is moving extraordinarily fast on the Texas cases, compressing into just a few days a process that normally takes months. And that schedule means the court will take up Texas' ban a month before it hears another major abortion case — a challenge to Mississippi's own 2018 ban on abortions after 15 weeks.

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