TikTok utilizes an internal virtual currency known as Coins, which users purchase and then use to send Gifts to creators during livestreams. These Gifts serve as a form of appreciation and support. The value of these Coins varies depending on the purchase amount, platform (iOS vs. Android), and any ongoing promotions. Converting Coins into Gifts, and subsequently into real-world currency for creators, involves a multi-step process. For example, a user buys 5 Coins within the TikTok app to support a content creator during a live session.
This gifting system fosters a direct connection between viewers and content creators, enabling viewers to express gratitude and creators to monetize their content. The virtual gifting economy creates incentives for higher quality and more engaging content. Historically, similar systems have been used in online gaming and other virtual worlds to facilitate microtransactions and support content creation. This method bypasses traditional advertising revenue models, offering a more direct route to financial support for creators.