What if making money was as simple as taking a few steps outside?
Three years ago, entrepreneurs Oleg Fomenko and Anton Derlyatka created Sweatcoin, with the aim of it becoming a global digital currency backed by the economic value of movement – essentially walking or running.
They now have ambitious plans for users in Britain to be able to pay their council tax simply by taking a stroll.
Sweatcoin, which launched in 2016, effectively enables users to make money by walking around outside.
Sweatcoin was createad by Oleg Fomenko (left) and Anton Derlyatka (right) and now boasts 30million users
Anton says: ‘We wanted to create something that was continuously engaging, easy to understand, intuitive and doesn’t require a lot of understanding.
‘Oleg’s obsession with blockchain helped in converting steps into coins. And then you can spend it straight away with about 300 vendor partners.’
The app, which currently boasts 30million users – 65 per cent of which are in the US – can be downloaded onto smartphones.
Venders that accept the ‘currency’ in Britain include telecoms giant Sky, food box service Hellofresh and fashion website Boohoo.
The founders say they have a long-term vision in which the digital currency will help users to pay bills such as council taxes – simply by going for a run or walk.
What’s more, the app is producing some encouraging results.
Research published by the British Journal of Sports Medicine showed that turning walking into currency could be a secret weapon in the fight against obesity.
According to the research, which looked at movement of 6,000 participants using Sweatcoin, users’ daily step count increased by an average of 19.5 per cent over a six month period after downloading the app compared with their average activity three months prior.
Anton says: ‘Now imagine a world where movement could pay your taxes – this study suggests we have a tool to reduce the burden on health and community services, saving billions of pounds of taxpayer money.’
‘The results of this study reach far beyond individual benefits; the improved movement of those individuals can collectively and measurably relieve pressure on our strained healthcare systems and improve the overall wellbeing of the nation.
‘We have ambitious plans for Sweatcoin, in collaboration with the private and public sector, to truly bring an end to our deadly sedentary lifestyles.’
How does it work?
The founders say the app tracks and verifies your outdoor steps using your phones accelerometers and GPS location.
Sweatcoin users can exchange coins for offers from partners which changes on a daily basis
The steps that are generated are then converted into their currency.
Every 1,000 steps generates 0.95 Sweatcoins and they can be used to purchase products in the in-app marketplace, with prices ranging from five to 20,000 Sweatcoins.
How does it make money?
Sweatcoin makes money through its brand partners which pay to be featured in the marketplace section of the app.
It also makes money from adverts shown on the app.
Users have to ‘pay’ for the pleasure to have more of their steps counted in the day – it charges them five per cent commission from each Sweatcoin generated.
While this could be deemed a type of tax on your steps, the founders highlight that it pays for friend invites and other bonuses which come from the Sweatcoin bank.
They explain: ‘Sharing five per cent commission with us from each Sweatcoin you generate allows us to give you money back – to you and everyone in the Sweatcoin community.’
Ironing out the kinks…
There are a few downsides to the app which has disillusioned some followers and generated a some complaints on social media over the years.
One bugbear is the fact that the app only monitors outdoor steps so if you happen to do a twenty minute run on a treadmill at the gym it won’t be counted.
The Sweatcoin founders say they are trying to address this problem but that there’s still too many ways to ‘game the system’, which is why it only tracks outdoor steps.
The Sweatcoin app only counts the steps you make when you’re exercising outside – something that it’s been criticised about by some users
You have to do plenty of walking to generate just one Sweatcoin.
One thousand steps gets you 0.95 Sweatcoins – and with the average person taking an estimated 3,000 to 4,000 steps a day according to the National Health Service, you would typically get between two to three Sweatcoins.
This puts ‘marathon offers’ – essentially attractive rewards, explained in more detail further down the article – which cost 20,000 Sweatcoin out of reach for the typical person for several years.
There are also complaints that the app drains phone battery.
Sweatcoin offers a battery saver mode which helps to sap less of your battery life but, by making use of this functionality, it warns ‘some steps will be lost’.
Sweatcoin pricing models
Sweatcoin also makes its money through encouraging users to upgrade to ‘paid’ memberships.
Mover: Under the free membership model, users can only earn up to five Sweatcoin a day, which is equal to around 5,000 steps (remember you lose some steps because of the commission structure). The per month cap is 150 Sweatcoin.
Shaker: Upgrading to the next membership model allows you to earn 10 Sweatcoin a day or up to 300 Sweatcoin a month, but this will cost you 4.75 Sweatcoin a month.
Quaker: This allows you to earn up to 15 Sweatcoin a day or 450 Sweatcoin a month at the cost of 20 Sweatcoin a month.
Breaker: This model allows you to earn 20 Sweatcoin a day or 600 Sweatcoin a month – all of which costs 30 Sweatcoin a month.
They do have a ‘Trouble Maker‘ model but at the time of writing the pricing model has not been revealed.
In Britain, the app also doesn’t feature hundreds of vendors in its marketplace section with four options typically offered under the ‘offers for today’ section.
For this reason, some claim it’s not worth using the app and draining your battery.
There’s also a cap on the number of Sweatcoin you can generate in a day – which is five on the free version.
It means you won’t earn any currency if you walk further.
You can switch to other models but you’d have to give up more Sweatcoin as you go up its pricing ladder (see right).
Oleg says the cap is there to prevent injury. ‘We want to discourage people from running marathons.
‘People who run marathons on a daily basis will be unhealthy. It [the cap] is not affecting a lot of people.
‘We don’t want people to suddenly jump off a couch and do a ultramarathon as it could result in injury and it prevents cheating.
‘As you can imagine a lot of people trying to break into the algorithm and fake their steps.
‘But it’s very hard to do as it has been designed so that it can’t be tampered with’.
Users are also not immune to getting scammed. While trialing the app, we were ‘invited’ by another user to send 100 Sweatcoin with the promise of getting 200 Sweatcoin back.
When presented with the ‘invite’, the Sweatcoin founders said: ‘We have a very strict policy on banning users that try to approach others in this way.
‘We are in touch with the user, and if it’s a scam they will be banned immediately.’
Currency: Sweatcoin offers users to convert steps into ‘currency’ – but how attainable are the premium items, such as an iPhone?
Are the offers any good?
Offers are updated daily. At the time of writing, we could convert the Sweatcoin we’d earned in the following ways:
– 7.99 Sweatcoin for 50 per cent off Little by Little Jewellery. A quick hop on the Little by Little Jewellery site and filtering ‘low to high’ shows that products start from £40, meaning you’d have to spend at least £20 to purchase an item from this particular online store.
How many companies will give you an iPhone just for walking? We’re changing walking from being a nuisance to something that has economical value
– A 60 day subscription to Scribd which offers books and audio books for 12.99 Sweatcoin
– A free day pass to any Payasyougym partner for 5.99 Sweatcoin.
– A three months free My Spa Pass for 4.99 Sweatcoin.
Sweatcoin also features what they refer to as ‘marathon offers’ where you’d need to have earned tens of thousands of Sweatcoin to redeem the prize. The current marathon offers include:
– An iPhone XS for 20,000 Sweatcoin
– A Curved Samsung TV for 20,000 Sweatcoin
– $1,000 cash for 20,000 Sweatcoin
– £1,000 Thomas Cook Holidays voucher for 20,000 Sweatcoin
Some users argue that with the caps in place it would take years to earn an iPhone or a Curved Samsung TV (see our calculations below).
How long would it take you to earn a ‘marathon prize’ with Sweatcoin?
Sweatcoin has a number of marathon offers at the time of writing which would cost a user 20,000 Sweatcoins, as revealed above.
How long would it take you to earn these prizes on Sweatcoin’s various pricing models if you maxed out each cap? This is Money did the calculations and this is what we found:
According to Sweatcoin it can take 24 months to get a Marathon Prize like a curved Samsung TV
Mover (free version): Time to marathon prize: 11.6 years.
This is based on the cap which only allows you to earn 150 Sweatcoin a month.
Shaker (price 4.75 SWC/month): Time to marathon prize: 5.7 years.
This is based on a cap of 300 Sweatcoin a month minus the 4.75 Sweatcoin monthly charge.
Quaker (price 20 SWC/month): Time to marathon prize: 3.9 years.
This is based on a cap of 450 per month and a 20 Sweatcoin monthly charge.
Breaker (price 30 SWC/month): Time to marathon prize: just under three years (2.93).
This is based on a cap of 600 Sweatcoin a month and a 30 Sweatcoin monthly charge).
This shows the marathon prizes are not within easy reach through steps alone, especially if you only stick to the free version.
Sweatcoin, however, claims the prizes are achievable in 24 months with steps and invites (see right).
But that means that on the free version alone you’d have to send out thousands of invites (valued at five Sweatcoin) to whittle the time to getting the prize down to a year.
But Oleg argues that earning such rewards should be done fairly: ‘How many companies will give you an iPhone just for walking?
‘We’re changing walking from being a nuisance to something that has economical value.
‘It would take a while [to earn it] but would it be fair to earn an iPhone in say two weeks?
‘You can obtain other prizes and we’re still proud of what we offer because the result is that our users move more.
‘We know we won’t make everyone happy.’
Will the Sweatcoin concept last?
It isn’t easy to earn the big rewards, but it has helped motivate some to exercise more.
But some – of course – then take it to the extreme. One user admitted to having spent nearly an entire day generating 100,000 steps – which would be roughly 50 miles of ground covered.
There have been many apps, such as PokemonGo, that have launched in the past to encourage people to exercise outdoors and embraced gamification to provide incentives but the hype didn’t last.
The founders explain that short term hype is not what they’re after.
Instead they want to create a sustainable model.
Anton explains: ‘PokemonGo was hugely successful but not beyond six weeks. We want to create ongoing engagement.’
With the prospect of paying council tax and other types of bills – and the company’s talks with London councils ongoing, the model could eventually be embraced by more users.
Four ways to get more Sweatcoin
Taking steps or going for a run is not the only way to generate Sweatcoin. You can also earn them in the following ways:
1. Get the family involved: If you’re not willing (or able) to do some walking outside, encourage the kids or your partner to go out with your phone and generate some steps.
The founders of Sweatcoin allow this as they don’t mind who generates the steps. Just don’t go out with two phones loaded with the app – that’s cheating.
2. Watch adverts: Engaging with adverts will also earn you more Sweatcoin.
3. Persuade others to give some to you: It’s possible to send and receive Sweatcoin so they can be exchanged between friends and within the family.
If your kids want money why not encourage them to either generate some steps for you or to do some chores in exchange for Sweatcoin?
4. Get your friends to join: You will earn five Sweatcoin if you get your friends to join.