On TikTok LIVE, the flow of virtual currency begins when viewers purchase Coins, which are then used to buy virtual gifts for creators. This process involves several steps that ultimately lead to the creators receiving a share of the money spent by their audience.
The Currency Flow: From Coins to Diamonds
Viewers can purchase Coins through TikTok, which are then spent on a variety of virtual gifts ranging from simple items like a Rose, costing 1 Coin, to more elaborate gifts that can cost tens of thousands of Coins. Each gift sent during a live stream is a way for viewers to show appreciation and support for creators.
Once a viewer purchases a gift, that gift is converted into Diamonds for the creator. Diamonds serve as a measure of the creator's earnings from the gifts received. The conversion rate for gifts to Diamonds is not fixed, but it is generally understood that creators receive a fraction of the original Coin value.
Payout Process and Platform Commission
Eligible creators can later redeem their Diamonds for cash. The redemption value of a Diamond is estimated to be around USD 0.005, but this amount is subject to a platform commission that further reduces the total payout. As a result, creators typically receive a smaller portion of the total amount spent by viewers on gifts, with estimates suggesting they net approximately a quarter of what viewers spend.
The journey of a TikTok LIVE gift illustrates the complex interactions between viewer engagement and creator compensation.
Overall, the process of gifting on TikTok LIVE serves as a means for viewers to support their favorite creators while navigating a complex system of currency conversion and platform fees.