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Introducing Referral Rewards: An Interview with Colin Armstrong

The founder of Paragraph discusses the new Referral Rewards program modeled on Zora Protocol Rewards

“We wanted to provide a new way to incentivize readers or curators for sharing content, while rewarding them for doing so. We also wanted to incentivize and reward people that help Paragraph grow. Crypto is uniquely suited to solve this, because it allows easy and immediate transfer of value – no signup or setup needed, unlike traditional referral programs.”
~ Colin Armstrong

Creator monetization has been deemed the biggest problem facing web3, but finally we’re seeing hopeful strides in the right direction. Recently I called Zora Protocol Rewards (which launched in August 2023) “the most groundbreaking positive-sum arts funding mechanism I’ve seen in web3.”

Now Paragraph, an “all-in-one publishing & newsletter platform,” is taking a page from Zora’s playbook. Modeled on Zora Protocol Rewards, the new Paragraph Referral Rewards program charges a small fee (0.000777 ETH) to collectors when they mint collectibles. Anyone can append their wallet or ENS address to any Paragraph URL, and get paid when readers follow their link and collect posts. The Paragraph smart contract then directs portions of the fee directly to the creators and referrers. 

Furthermore, if new creators sign up to publish on Paragraph using the referrer’s link, the referrers get rewarded — indefinitely — when the new creators monetize. (!)

Web3 needs sustainable business models that direct more value back to writers, artists, and creators, instead of siphoning it away from them. In the interest of “building in public” and encouraging other web3 projects to consider launching similar programs, I invited Colin Armstrong, founder of Paragraph, to discuss the new rewards program and the design thinking behind it.

Congratulations on the launch of the new Paragraph Referral rewards program! According to the Paragraph website and docs, the program applies to all Paragraph publications, and all readers can get paid for sharing any content published on Paragraph at any time, even if they haven’t set up a Paragraph account. How does this process work?

That’s right! We wanted to provide a new way to incentivize readers or curators for sharing content, while rewarding them for doing so. We also wanted to incentivize and reward people that help Paragraph grow. Crypto is uniquely suited to solve this, because it allows easy and immediate transfer of value – no signup or setup needed, unlike traditional referral programs.

In practice, anyone can append any wallet address or ENS to any URL. It’d look like this:

After that's done, whenever anyone clicks on that link, colinarms.eth would be set as the “referrer” for the Paragraph creator (@danicaswanson in this case). If they collect one of your posts, I’d receive some reward fee. 

If people click on my referral link and register on Paragraph themselves, colinarms.eth would be indefinitely set as their “referrer,” and I'd receive a reward fee for every single one of their collectible posts in the future! 

You mentioned that the Paragraph Referral Rewards program is modeled on Zora Protocol Rewards. I’m curious about the similarities and differences between these two groundbreaking programs, so I started a list.


  • Both programs function on autopilot (i.e., rewards accrue to recipients immediately).

  • Creators can receive rewards even for work they release “free.”


  • Zora rewards must be claimed manually (by connecting a wallet and initiating a transaction), while Paragraph rewards are immediately sent to a recipient's wallet address with no action required.

  • Zora rewards are built into the protocol smart contracts and can’t be bypassed; Paragraph rewards require human volition. If there are no referrers — say, a writer/referrer forgets to click the “share this post” option to append a wallet address — all fees paid by collectors go to Paragraph by default.

What’s your take on how the two programs compare?

I think the primary difference is the “action of value” that Paragraph and Zora are trying to incentivize.

For Zora, they’re trying to optimize for mints. For Paragraph, we’re trying to optimize for creator growth. Minting collectible posts plays a role, but is not the primary focus area for us.

As a result of this:

  • Zora mints are 100% onchain, whereas Paragraph subscriptions are not. We need human volition, as you mentioned.

  • We can (and will!) issue referral rewards beyond just collectible posts as NFTs, since we are not optimizing for mints as the primary action of value. Imagine creators charging $5 a month in USDC to access their gated content – if someone refers another person to this newsletter, perhaps they could be rewarded some portion of this recurring revenue taken out of Paragraph fees.

I’d like to hear more about the design process for this program. Your first draft (as shared on Farcaster) did not include a cut for creators, since you were concerned about cases in which creators did not want to receive a reward. After further input, you decided that paying the creator a small reward for each “free” collect is the right move. What was it that tipped the scales for you in the direction of paying the creator rewards?

Several things:

  • From a company perspective, I really like the angle of “we only make money if you make money.” That aligns incentives and makes creators happier than "we're profiting off of your work, even if you're not making anything off of it.”

  • In conversations with Jacob Horne of Zora, I realized that this helps alleviate hesitation from minters towards creators by redirecting responsibility to the platform. Some minters may have previously thought “this artist is just rent-seeking; I'm not sure their [writing, art, music, etc] is worth [some amount].” This change helps shift collector sentiment more towards “I really like this artist, and I'm OK paying [platform fee] to receive this in return.”

  • For creators, it reduces the cognitive overhead involved in pricing their own work.

  • It compensates creators more fairly.

How did you decide to address situations where the creator doesn’t want a reward, as per your initial hesitation?

Unfortunately I don't have any great solutions here. My opinion changed after a conversation with Jacob helped me realize that the pros, as outlined above, outweighed this con.

Upon further thinking I also realized that creators could choose to direct the funds elsewhere on Paragraph by pasting in a different wallet address. So, for example, I could direct funds to Purple DAO for upcoming Paragraph <> Farcaster announcements.

You’ve mentioned in interviews that the vision for Paragraph involves helping creators build publishing businesses using permissionless protocols whenever possible (e.g., storing posts on Arweave). How are you thinking about the future for reward recipients if Paragraph ceased to exist as a business?

We want to get to a state where things will continue working without us. We’re nearly there, but not quite. A handful of the things we’re doing or thinking about:

  • Content is stored on Arweave, and can be rendered anywhere.

  • The NFTs are owned by creators. They can update the NFT metadata, images, etc., if Paragraph shuts down and stops providing it.

  • The smart contracts have a 'mintWithReferrer' method, so platforms and protocols that are built to incentivize mints through referrers will still function.

  • The Stripe accounts – should a creator choose to monetize with paid fiat subscriptions – are owned by creators, not by Paragraph.

  • Creators can export email addresses and wallet addresses at any time. When we launch “subscriber NFTs,” there will be no need to even export – creators will know who’s subscribing to their newsletters just by looking onchain.

How would you respond to a skeptic who says: “Referral rewards? Not impressed. Creators/referrers get a minuscule fraction of the collector fees, it’s on them to share the link, and the platform still takes most of the revenue.”

I think Zora’s results speak for themselves: they’ve paid out over $1M to referrers in the first six weeks after launching the program. Even with a small cut of transactions, at scale it adds up!

Additionally, in web2, referral programs have been proven to help grow newsletters (and the link still needs to be shared manually!) The key difference: in web2, the rewards are rarely in cash; it’s much more common to offer a free month to a paid subscription, or physical goods like T-shirts. With our referral program, creators get paid – with crypto – immediately.

If I understand correctly, referral rewards apply to any NFT, including individual quotes minted with the collectible highlights feature. How might curators of Paragraph collectibles (articles, quotes, images, etc.) make good use of the rewards program? Is there a profile page or integration planned that enables readers to build collections?

There are a handful of different types of curators or platforms that could be rewarded through this mechanism. For example:

  • A Gallery-esque platform could curate “Farcaster posts and quotes” as a sort of knowledge base or showcase of some of the meaningful things people are writing about Farcaster. They could append their own wallet address as the referral reward, should anyone choose to mint these posts or quotes.

  • Apps like Interface, Yup, or Daylight could curate “trending Paragraph posts/quotes” and surface them to their audience, receiving referral rewards for traffic they drive.

The Referral Rewards FAQ states that Paragraph has plans to expand the actions that qualify for rewards in the future. Can you say more about what’s on the horizon?

Yes! A couple of things are on the horizon:

  • Subscriber NFTs. Creators will be able to create an NFT that their audience could mint as an indication that they subscribe to this newsletter. This NFT could be used to build entirely off-platform and interoperable communities, such as a gated Discord server. Referral rewards will be distributed for these mints as well.

  • Recurring crypto payments. In the next few weeks we’ll be adding support for paying with crypto, in an automatic and recurring way, to grant access to a Paragraph creator’s community (including optionally gated content). We can distribute referral rewards on a recurring basis to incentivize and reward people for driving paid membership growth.

Thanks for your time and thoughtful answers, Colin!

[Addendum: the differences section originally stated that a seven-day withdrawal process was required for Zora rewards. Correction: the seven-day withdrawal process is only for bridging Zora ETH back to Ethereum mainnet, which is unrelated to protocol rewards.]

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#digital publishing#business models#interviews#web3#protocol rewards#referral rewards
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