China's Biggest Short-Drama App Is Switching Off the Coins That Built It
Hongguo, the free short-drama platform that out-drew China's four big streamers combined, will retire the coin rewards that kept viewers grinding for credits — a rare case of a platform deliberately switching off its own growth engine.
The announcement was buried in the flat language of product changes, and the hashtag above it was not: Hongguo Short Drama "cuts down its own money tree" (红果短剧自砍摇钱树). From November 1, new users of the app will no longer see the coin section; by December 31 the coins stop for everyone. Balances already earned stay redeemable, on the platform's own timetable.
The coins were the engine. Watching shows earned coins; coins redeemed for cash; the loop kept viewers opening the app between episodes and built, in three years, China's most-used video platform — a figure circulating in the coverage puts its daily audience at 168 million, more than iQiyi, Youku, Tencent Video and Mango TV combined. The audience this built was not, strictly, an audience of drama fans. "A lot of people were only in it for the coins — at least all the older people around me are," one user wrote. "Otherwise I really can't see what's worth watching in these junk mini-dramas."
The economics behind the retreat are laid out on Baidu's trending board: Hongguo is free, funded by ads selling at about 25 yuan per thousand impressions, and what trickles down to production teams is thin — AI-assembled mini-dramas reportedly earn one to two yuan per ten thousand views. Meanwhile Tencent has entered the space with incentives worth up to 100 percent for creators, bidding for the same studios.
Cutting the coins is a bet that the audience left behind will stay for the stories. The platform's framing — that subsidies bought "inefficient traffic" chasing payouts rather than plots — is an admission that a growth engine can become a liability: daily-active numbers that impress in a pitch deck, monetize badly, and train users to value the app for the wrong reason. For the production side, the shift moves the industry closer to paying for retention than for clicks.
The short-drama sector is one of China's fastest-growing screen businesses, and every rival is watching the experiment: whether an audience weaned on coins will stay for the plots is the question Hongguo has just decided to test in public.