Creation Economy

The Creation Economy represents a revolutionary approach to AI content generation and monetization that addresses fundamental challenges in the current AI industry: fair creator compensation, intellectual property rights, and sustainable value creation. This system enables content creators to properly monetize their work through multiple sophisticated channels while ensuring clear attribution and fair compensation for both original and derivative works.

Core Mechanisms

The creation economy operates through three primary mechanisms that serve different creator needs and use cases:

Remix Function: Creating New Collections

Remix represents a sophisticated approach to derivative content creation on the ERC-1155 standard, enabling creators to establish their own unique collections while respecting original creators' rights.

The Remix system allows creators to build upon existing works by modifying the original prompt or generated image. When using Remix, creators initiate a new ERC-1155 collection distinct from the original, allowing them to:

• Transform original art styles

• Modify visual elements

• Adjust color schemes

• Reinterpret the original concept

• Create cross-genre variations

Each remix operation costs $1.99, with revenue distributed as follows:

• 60% ($1.19) to the original creator

• 40% ($0.80) to platform development

Additionally, original creators benefit from a referral system where they earn 0.5 Paper for each remix through their unique referral links, creating passive income opportunities.

Try Function: Collection Expansion

The Try system enables users to expand existing collections within the original creator's ERC-1155 framework. Unlike Remix, Try maintains the exact parameters and prompt of the original creation, operating as an expansion of the original collection rather than creating a new one.

Key aspects of the Try system include:

• Uses identical generation parameters as the original

• Creates variations while maintaining core concept

• Expands the original collection

• Maintains consistent collection metadata

• Implements bonding curve pricing

The Try mechanism starts at a fixed price of $1, with subsequent pricing determined by a bonding curve that reflects collection popularity and scarcity. This creates a natural market mechanism where early supporters benefit from collection value appreciation.

Create Token System

A tokenization mechanism that transforms AI-generated content into tradeable digital assets. For a fee of $4.9, creators can tokenize their work with the following benefits:

• 90% of subsequent trading fees go to the creator

• 10% contributes to platform sustainability

• Automated royalty distribution through smart contracts

• Permanent on-chain attribution and provenance

Create Event System

Create Event serves as a core functionality available to users after Make Trade, implementing a fee structure that ensures market transparency and fairness while maintaining sustainable platform operations.

Event Creation and Betting Structure

Basic Structure

• Maximum Betting Limit: 200% of Make Trade amount

• Minimum Betting Limit: 2% of Make Trade amount

• Winner Pool Distribution: 95% of total betting amount

• Platform Fee: 3.5%

• Event Creator Reward: 1.5%

Event Creation Fee Structure

1. Base Fee

   • 1% of Make Trade amount

   • Minimum fee: $10

2. Duration-based Fee Multipliers

   • 24 hours: Base fee

   • 48 hours: Base fee × 1.5

   • 72 hours: Base fee × 2

   • 1 week: Base fee × 3

Betting Fee Structure

Tiered fee system based on betting amount:

• Betting up to 50% of Make Trade amount: 1.5%

• Betting 51-100% of Make Trade amount: 2.0%

• Betting 101-200% of Make Trade amount: 2.5%

Incentive Programs

Initial Promotion Strategy

• 50% discount on first event creation fee (minimum $10 maintained)

• 20% discount on next event for achieving high participation (50+ participants)

• 30% discount on next event for accurate prediction events

Long-term Engagement Strategy

1. Short-term Focus

   • Event creation promotions for initial user acquisition

   • Promotion of 48-72 hour events for increased fee revenue

   • Marketing initiatives targeting high-value Make Trade users

2. Long-term Development

   • Fee optimization based on event success rate data

   • VIP program implementation for high-value event attraction

   • Seasonal special events for revenue maximization

This fee structure and incentive system is designed to ensure platform sustainability while encouraging active user participation. The system particularly rewards long-term participants and successful event creators, promoting healthy ecosystem growth through a balanced approach to revenue generation and user incentivization.

Value Flow Comparison

Feature	Remix	Try
Blockchain Structure	New ERC-1155 Collection	Within Existing Collection
Creative Freedom	High (Style/Element Changes)	Limited (Same Parameters)
Initial Cost	$1.99	$1.00
Original Creator Revenue	60% + Referrals(0.5 Paper)	Direct Token Value
Collection Relationship	Referenced	Integrated
Value Appreciation	Independent	Collection-Based

Benefits and Justification

This economic structure solves several critical issues prevalent in current AI content platforms:

Fair Compensation

The system ensures creators receive appropriate compensation through:

• Direct revenue from initial content creation

• Ongoing royalties from derivative works

• Multiple monetization streams from a single piece of content

• Referral bonuses for community growth

Clear Attribution and Ownership

• On-chain recording of all creation parameters

• Transparent relationship between original and derivative works

• Immutable proof of creation and modification history

• Clear distinction between collection expansion and new creations

Sustainable Value Creation

The multi-tiered approach ensures sustainable value distribution through:

• Initial creation value via direct sales

• Secondary market value through trading fees

• Derivative value via remix compensation

• Network value through referral rewards

This comprehensive approach to content creation and monetization represents a fundamental advancement in AI platform economics. By implementing transparent fee distributions, multiple monetization paths, and sophisticated market mechanisms, we ensure creators receive proper compensation while encouraging innovation and collaboration. The high creator share percentages reflect our commitment to prioritizing creator success over short-term platform revenues, creating a sustainable ecosystem that benefits all participants.

Through this carefully structured economy, PlayArts establishes a new standard for AI content creation and monetization, solving long-standing issues in the industry while creating new opportunities for creators to thrive in the AI-powered creative economy.