Sweat Economy: Deep Dive (2024)

Introduction to Sweat Economy

Today I’m going to discuss the ‘Walk-to-Earn’ platform called Sweat Economy (Sweat). In their own words: A dynamic, Free NFT game where players go head-to-head to win $SWEAT.

The basic premise of Sweat is that you walk, they track your steps on your phone, and you earn rewards. I’ve been using this for a few months and have no affiliation or commission arrangement with the platform.

They have over 150 million users which is wild (ie. impressive), and state that users are 20% more active after downloading the app.

There are multiple ‘Move-to-Earn’ platforms, so just like a frequent flyer programme, it’s going to come down to the core questions of how much can I earn, and how can I use those points?

The other key questions we need to understand are:

• Tokenomics - what is the token value, how is it designed and what is the probability of it rising.

• Team - is this a real team, building a real product with significant funding.

• Road map - what is the longer term plan? If you are going to invest time in this it could take months or years to build a sizable bag of points so you want to have some confidence it will last.

• User Reviews - there are a tonne of user reviews out there on the web so we will take a look at a few of these and try to sort the rants from the reasonable…

How does it work

First thing to note, there are 2 apps required on your phone for this to work:

1. Sweatcoin - the app where you earn the coins (ie. it counts your steps) and it calculates earning two tokens: sweatcoin and SWEAT (explained below)

2. Sweat Wallet - the app where you claim / save the SWEAT coins.

Initially, the system feels more confusing that it needs to be. It’s not like you just walk X steps and receive Y rewards and it is all in the same app, with the same wallet. Having said that the tracking of steps is easy and automatic, and I assume it is just taking data from your phone’s pre-loaded step counter.

The Sweatcoin app shows me how many steps I’ve walked that day (against a daily goal of 5,800 which I set), shows me how many days in a row I’ve hit that target, and gives me chances to ‘spin to win’ (which force you watch pretty terrible ads).

There are tabs that allow me shop (including donate and bid on auctions, daily rewards (like scratch cards) that need to be unlocked by steps, and the social tab where you can join clubs (ie. walking clubs where they have leaderboards).

The SWEAT wallet is more like a banking app where you hold your SWEAT tokens. These have real world value and can be sold in the app by trading them with another cryptocurrency (including Ethereum, Near and USDC). You can also create a savings jar where you earn interest, and enter prize draws.

To summarise:

• 1st app where you earn steps and can use sweatcoins is like a closed ecosystem (a bit like a shopping mall loyalty programme) where you can only use the tokens within the app with partners.

• 2nd app is a crypto wallet where your converted SWEAT coins can be saved or sold, and have real world value.

Another way to sum it up was the the 1st app was web2 based, then they transitioned to the 2nd app which they built on web3 to enable a cryptocurrency.

Earning Tokens / Tokenomics

OK so we know they have created a two token economy where you earn both sweatcoins and SWEAT. In my case, I am told: your first 5K steps per day get converted into SWEAT’.

What exactly is going on? Well, their system is designed so that SWEAT is only created (or minted) by walking. ie. the number of SWEATS in the world is a direct result of the number of users and their recorded steps. As you can see from the image below, the number of steps needed to generate 1 SWEAT is gradually going up.

The reason for this is about tokenomics - that means the design of the token (its supply, how to mint (create more), burn (reduce) and ownership (ie. who gets what). In this case, they created a system to protect and hopefully increase the long term value of SWEAT. If it’s too easy to create them, then they won’t have value. So they introduced an increasing mint rate.

If you joined at launch, it only took 1000 steps to earn 1 SWEAT. Right now it is taking me 5000 steps, and next year that grows to 7500. This is where it gets really hard for platforms to get it right. Make things too easy and there is no value in the token, make things too hard and you walk all day and night for what?

My Earnings

At the time of writing, my earnings total was:

• 56.02 sweatcoin

• 18.79 SWEAT (with 3.92 ready to claim)

The total days used were from 9 March - 10 April (32 days). You can see from the above that I was earning just under 1 SWEAT per day and anything from 1 - 4.1 sweatcoins per day.

I mentioned being ‘ready to claim’ above. Even after the SWEAT are minted, you are required to open the app every 60 days to actively claim them. They actually charge a 1 SWEAT gas fee to claim (gas fees are a crypto term, meaning a transaction fee to perform any action on a blockchain network).

After claiming my 3.91 SWEAT, by balance is now 21.71 SWEAT. To put that in perspective, that is worth 0.25c in real money. Yes, after walking for 1 month I have only earned 0.25c. This is the cause of many negative reviews I discuss below.

One important factor - I’ve been averaging 6,500 steps over the last month (checked on Apple fitness, not sweatcoin) - so not a big walker, but fairly normal I suspect.

SWEAT hit 11c in September 2022 and has since hovered around 1-2c. Let’s look at a positive scenario to see if this makes sense. Let’s say I walk my required steps and get 1 SWEAT each day (30 / month, or 365 / year) and the price of SWEAT gets to an all time high of 15c. In that scenario, I would be earning ~$USD55 / year.

If you are a walker and doing the miles anyway, then why not. But for most people, ~$50 / year may not be enough incentive.

To increase the earning potential they’ve included the concept of a savings jar, which is basically the ability to set up an interesting paying account. When I click on it, it gives me 3 choices: 12 months (12% per year), 6 months (6% per year) or 3 months (3% per year).

You can choose how much of your SWEAT to deposit and it shows you exactly how much you will recieve. It also unlocks access to better rewards and lower transactions fees - although I haven’t experienced these yet myself.

In addition to the real world value of SWEAT, there are a range of non-cash rewards, like prize draws. At the time of writing, my app included the following:

• Win 2500 SWEAT (need 50 SWEAT to enter)

• Win $50 Adidas Gift Cards (need 100 SWEAT to enter)

• Win Xbox Series X + 1 game (need 2,500 SWEAT to enter)

There are different prizes for sweatcoin (remember I have about 56):

• Get 70% off CLEO eyewear (need 5 sweatcoin)

• 60% off EarFun Wireless Earbus (need 5 sweatcoin)

• Winning bid on action for a DJI Mavic Air 2 Drone (bidder spent 28,702 sweatcoin)

• Winning bid on Sonos Arc speaker (bidder spent 21,350 sweatcoin)

The prizes and auctions are a good benefit, but you need to spend fairly serious time walking to be able to win something major. Just to win an Xbox I would need 83 months of walking on my current rate, and that’s just to be eligible to go into the draw!

Having said that, people are winning serious prizes - this is an example of a 22 year old German man winning a $7.5K prize.

What is Premium?

OK so I’m starting to feel less motivated. Clearly to get any financial benefit from this app I am going to have to walk a lot, and with the cost of SWEAT increasing over time, my ability to earn is reduced. Is the premium the answer?

As you can see, Sweatcoin gives you the option to upgrade to their Premium tier, either for $35.99 / year, or $6.99 / month. The listed benefits include double sweatcoins for every 1K walked, a higher minting cap on SWEAT (6K instead of 5K), and unlimited daily cap on sweatcoins.

Premium might make sense if you are (a) a big walker with minimum 10K steps a day, (b) like promotions and prize draws that you can use sweatcoin for and (c) happy to take a long term view that if the value of SWEAT goes up meaningfully then your investment will pay off.

The fact that there is an uncapped supply of SWEAT makes it hard to have any long term view on value accretion. It does however, make more sense in the context of making it increasingly hard to earn them.

Team

One thing I like about sweatcoin is that the team is public and actively involved.

• Oleg Fomenko (Co-Founder)

• Igor Khemelev (Co-Founder / CTO)

• Anton Derlyatka (Co-Founder / CEO)

You can check out the 3 founders linkedin accounts above. You can also listen to them talk at events below:

1. Web Summit 2023 - A real use case for blockchain: Creating a Movement Economy

2. Ask Me Anything (‘AMA’) #2 with All Three Founders

Watching these will help you understand their objectives and definitely kill any concern that this is not legit. As Anton says in the second link, the original idea was ‘how do we create a new loyalty programme for health’. They have already achieved that, and if nothing else, have created a working platform at the intersection of crypto and physical movment.

Updates and Roadmap

So where are they going from here? Recent updates include the following:

• Inactivity Fee - this has already been added and is the requirement I mentioned above to login to the app every 60 days. This is basically a use it or lose it functionality.

• Community voting / Governance - this has already been added and allows the community to vote on decisions regarding the future of the product. They recently voted on the inactivity fee descrived above (I voted on this too).

• Sweat Hero NFT game - this is an option in the app at the moment which gives you the ability to obtain NFT legs to compete in races with your friends (more detail below).

Sweat Hero is a recent addition to the app and it’s an example of the effort the team is putting in to build out the product and increase engagement. The game itself requires you to tap the screen - a bit like one of those arcade dancing games where you have to step on the right place at the right time.

You have to earn SWEAT to play and can earn SWEAT from battles. Unlike other platforms, you don’t have to buy NFTs which is good, but it will be interesting to see if this becomes a popular feature. People who like to walk, don’t necessarily want to play a tapping game with their friends.

New Activities - they plan to add other sports like running, cycling and swimming. If this allows you to earn extra tokens proportionally - ie. you can double or triple your output - then this will be a big addition.

Reviews

Some stats and summary of comments:

1. Trust Pilot gives it 4.8 / 5 stars based on 1,450 votes.

2. The Apple Store reviews also rate it 4.8 / 5 based on 14,700 ratings.

3. Google Android Store review give it 4.1 / 5 based on 2.2m reviews!

Examples of positive comments:

• Really like the concept

• Great app for people who want to be encouraged to walk

• Lots of people reported winning things (less about earning tokens)

• Good for non-crypto people to be introduced to crypto via SWEAT

Examples of negative comments:

• Low earning potential (consistent with my comments above)

• Being capped at earning 1 SWEAT / day is disappointing given their value

• Don’t like having to claim and pay gas fee

• Difficult to contact support

• Some have experienced bugs, unable to login etc (my own app froze multiple times)

• Doesn’t count steps accurately

Final Say

The Sweat Economy team have built a well thought out walking rewards app, full of reasons to walk and engage. The app is well designed and works well, and once other activities are added the ability to earn more SWEAT could significantly increase its appeal.

However, the low value returns will turn a lot of people off and they have to be careful not to turn it into too much of a game show - spinning wheels, watching adds and tapping games - threatening to undermine what is a brilliant vision: to get more people moving.

Hope you found that review useful. Jack