What would encourage you to do more exercise? The obvious answer, say the founders of STEPN, is cold hard cash. Their move-to-earn running app offers its users cash rewards to get more active and has already persuaded millions of people to sign up in the space of just a few months.
It’s a simple enough principle, explains Yawn Rong, co-founder of STEPN. “We wanted to incentivise people to change their behaviour and do more exercise,” he says. “It’s a way to share the benefits of Web3 technologies with a new and diverse pool of fitness enthusiasts.”
To participate, users must download the STEPN app and then buy a virtual pair of sneakers in the form of a non-fungible token (NFT). Once they’ve done that, each time they go for a walk, jog or run outside, STEPN’s GPS tracking and motion sensor technology monitors how far they have travelled and rewards them with tokens. These tokens can then be spent inside the game – on upgraded sneakers, for example – or cashed out into hard currency.
The potential rewards on offer look enticing. Rong says the minimum that users can expect to earn is $25 for 10 minutes of activity and that some users are earning as much as $4,500 a day. But many people don’t take all the cash, he adds. They use their earnings to acquire new NFTs within the game, take part in trading with other players, and elect to give some of their cash to good causes.
If all this sounds too good to be true, there is a catch. To start playing, you’ll need to buy those NFT sneakers, which are priced in Sol, the native cryptocurrency of the Solana blockchain, on which STEPN operates. And they’re expensive: the day-to-day price in fiat currency varies according to the value of Sol, but the cheapest sneakers will set you back hundreds of dollars – and, at times, the entry price has gone well above $1,000.
In the coming months, STEPN hopes to introduce a sneaker rental feature in order to get round this significant upfront cost of taking part. New players would rent sneakers from someone already in the game, splitting the revenue they earn with the sneaker owner until they earn enough to buy their own NFT sneakers. That would encourage more people to take part – and help STEPN break into new markets; it is currently most popular in wealthier countries such as Japan, France, the US and the UK, where users can afford that first NFT purchase.
For now, however, the barrier to entry of high initial purchasing prices does not seem to be putting people off. Since the launch of STEPN last December, the app has signed up 2.3 million monthly active users, with half a million of them using the app on any given day. That has seen the value of STEPN’s tokens soar, with trading volumes in its GMT governance tokens exceeding those of Bitcoin and Ethereum on certain days.
Indeed, STEPN is attracting significant interest in the cryptocurrency investment world, with the tokens registering gains of several hundred percent at their peak, albeit with significant volatility. While new cryptocurrencies have come and gone at a dizzying rate over the past couple of years, some investors are betting the move-to-earn principle that underpins STEPN will give it more longevity.
As for STEPN itself, it takes a 6% cut of its NFT trading fees, generating significant revenues for the company in a very short space of time – the company made a $26 million profit in the final quarter of last year alone and has already achieved a valuation of more than $1 billion with some analysts.
Still, Rong and his co-founder Jerry Huang are not resting on their laurels. They regard STEPN as a first step towards a broader Web3 offering, believing that users who get used to the concepts of cryptocurrency and decentralised finance will develop the confidence to participate more broadly. “Users can expect more exciting developments from STEPN in the future,” says Rong. “The app has plans to integrate more socialfi elements into its platform and will roll out exciting features for non-native crypto users to facilitate their onboarding onto the Web3 world.”
The founders are also keen to stress their green credentials. As well as STEPN’s use of Solana, widely seen as a more environmentally-friendly blockchain, the business gives users the opportunity to donate some of the profit pool to buying carbon removal credits.
More traditional sportswear businesses are taking notice. Last month saw STEPN announce a collaboration with footwear giant ASICS, which released a limited edition set of branded sneakers on the app. “The STEPN app is an incredible feat of technological innovation and we believe that ASICS’ immediate and long-term collaborations with them will help millions across the world achieve a sound mind in a sound body,” says Joe Pace, head of business development at ASICS.