Web3 Social Landscape

Forward the Original Title：Pantera Capital合伙人：Web3 社交版图

Introduction:

Previously, I authored an introductory series on the future of social networks, comprising three parts:

The future of social networking - Part 1

The future of social networking - Part 2

The future of social networking - Part 3

At Panther Panther, we are excited about how Web3 is unlocking new approaches for social platforms, enabling users to connect and interact with creators, influencers, and other users. Last month, the decentralized social protocol Farcaster experienced a surge in popularity following the launch of Frames. This feature allows developers to create interactive, embeddable posts for their audience. Soon after, users began minting NFTs, earning rewards by completing surveys, playing “Doom,” and even purchasing Girl Scout cookies directly through Farcaster’s flagship client, Warpcast.

Previously, achieving such seamless in-app experiences was impossible through traditional web2 social media platforms. Identity, ownership, tokens, and payment rails—these are all functionalities of blockchain that enable the creation of new social features like Frames. In this article, we will explore different social protocols and platforms, focusing on how they utilize the building blocks of web3 to create novel experiences.

Warpcast and Lens

In web2, data is siloed and controlled by the platform itself. This means developers cannot create alternative platforms that present content in new ways. X (formerly Twitter) confines users to its platform, limiting flexibility for interfaces with different algorithms. Additionally, users don’t own their accounts—if they’re banned, they lose their audience reach and the ability to post to that account.

Farcaster and LensLens are two popular social protocols that take a unique approach: they expose data and empower users to control their accounts. Farcaster stores its published data on a decentralized storage network called Hubs, making it accessible to everyone. Furthermore, Farcaster profiles are linked to users’ Ethereum accounts on the Optimism platform, ensuring users truly own their digital identities.

Lens is an on-chain social graph and developer tool that empowers users to own their content. Interactions on Lens can be published on-chain or to the data availability and validation layer, Momoka. Creating a profile on Lens grants users a unique, sequentially numbered NFT. This NFT serves as the access point to the protocol, where users can perform actions like following, posting, and commenting. With ownership of their own NFT, users have ownership of their profiles. Developers are leveraging these open protocols to build a variety of engaging clients and features. Users publish content at the protocol level, and the same content can be accessed by any of the multiple clients available. While Warpcast serves as the flagship social media client for Farcaster, offering a user experience similar to X, Phaver and Orb provide popular experiences on Lens, among many other clients. Supercast caters to more serious, active Farcaster users; Sealcaster allows for anonymous Farcaster posts using zk-proofs; Tape is a client specifically for media sharing on Lens.

The innovation sparked by these open protocols extends beyond just client applications. The difference between protocols like Farcaster and Lens compared to web2 lies in their on-chain identity, payments, tokenization, and composability functionalities, which, when combined, enable novel innovations. For example, on Farcaster, new experiments like DEGEN are emerging, where DEGEN is a tradable token that users can use to tip others by commenting on posts. Additionally, tools and services have seen significant expansion. Bountycaster, compatible with any Farcaster client, allows users to create and complete tasks for USDC rewards. Lens’ open actions feature enables embedding custom on-chain actions into publications, enabling new functionalities in social sources like payments (charging, tipping), NFT minting, token issuance, and more. Whether it’s tokenized games directly embedded into applications, prediction markets scoring based on updated on-chain social reputation, or tools to better aggregate Farcaster and Lens data, there are countless experiments, applications, infrastructures, and tools waiting to be created.

Friend.Tech

Last September, the web3 social application Friend. Tech took the crypto community by storm. Within a few months, the platform amassed over 100,000 accounts. Introducing a novel feature, the app allowed users to purchase “keys” to unlock direct messaging access and entry into gated chats and other exclusive privileges of influencers. Influential figures like gaming influencer FaZe Banks and NBA star Grayson Allen joined the platform, sharing their thoughts on gaming, cryptocurrencies, and sports with keyholders.

What excited keyholders about the app was its ability to trade keys, turning them into an investment in the future demand for influencers. Through friend. tech, users engaged in buying and selling keys, with a portion of the proceeds going to both the influencers and the platform itself. Many top cryptocurrency influencers began earning hundreds of thousands of dollars through royalties, sharing alpha and ideas from the crypto market. In just two months, friend. tech generated nearly $20 million in revenue.

Due to retention issues, activity on the platform has seen a significant decline since its peak, with transaction volume dropping by over 99% since the peak period. However, friend. tech has demonstrated powerful features in its adoption of web3 social platforms:

1. Progressive Web Application (PWA): A key factor in friend. tech’s rapid growth to over 100,000 users is its Progressive Web Application. This technology allows users to log in without complex wallet setups, instead using familiar methods such as Google, Apple, or SMS verification. This greatly simplifies the onboarding process for ordinary users, making it more accessible.
2. Leveraging Web2 Audiences: friend. tech attracts users by leveraging the existing user base of web2. By allowing users to connect through their X (formerly Twitter) accounts, friend. tech facilitates ongoing conversations about its platform on X, thereby driving more X users to register.
3. Tradable Social Assets: friend. tech introduced a dynamic social asset market where users can trade keys, benefiting from its second-layer Base with low transaction costs. As seen in the success of BitClout in 2021, combining financialization and speculation with social applications has the potential for viral effects.

Focus

The recent announcement from Pantera portfolio company DeSo regarding the launch of Focus, its premier application built on the DeSo blockchain in June this year marks a significant development. Focus will enable users to pay for content using cryptocurrency while facilitating native crypto subscriptions, paid messages, and paid reposts. Focus also integrates novel speculative primitives through a new product called “Creator Coins,” tokenizing creator income.

Addressing the cold start problem — attracting enough users to make a social network valuable — is a significant challenge in developing social platforms. Protocols like Farcaster and Lens tackle this issue by offering innovative experiences that engage users with unique interactions. Friend. tech strategically targets the involvement of cryptocurrency influencers, leveraging their followers to bring a knowledgeable user base to their platform.

Focus is attempting to address the cold start problem by using web3 incentive mechanisms to attract users. Users with high-value followings on networks like X, Instagram, TikTok, or Twitch will be incentivized to register and participate in the platform as they will receive FOCUS token rewards proportional to their influence. The team refers to this novel mechanism as “social airdrops.”

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Another essential requirement for the success of a social network is retention: users need to stick around. The DeSo team has devised a Post-To-Earn mechanism to address this issue: Focus will distribute tokens weekly to top creators who consistently engage with content. As users’ accounts are linked to their on-chain wallet addresses, Focus can monitor user activity and wallet balances to differentiate between genuine users and farming bots.

Even without incentive measures, why would creators continue to use Focus instead of other platforms? Focus introduces innovative new monetization methods enabled by blockchain for creators. Firstly, Focus allows users to pay and be paid in cryptocurrency through subscriptions, paid messages, and a new primitive called “paid repost,” essentially acting as a decentralized advertising model on the platform. Secondly, as all content data is stored on the DeSo blockchain, users can use Focus’s generative AI tools to generate new content, allowing creators to set fees for each user query of their work by remixing their previous images. Finally, through tokenizing creator income, emerging creators will be able to issue and sell “creator coins,” earning a certain percentage of content revenue, enabling early supporters to invest and benefit from the ongoing success of creators.

Conclusion

Today, with support from both Layer 1 and Layer 2 solutions that enable cost-effective transactions and novel approaches to data storage, we are witnessing the emergence of social platforms across the entire web3 landscape. We are now seeing how social platforms leverage various aspects of blockchain technology. Here are the key points:

Leveraging open protocols for developers to generate innovative use cases is incredibly powerful. Farcaster and Lens are not the next Facebook; instead, these protocols will enable clients and applications to attract tens of millions of users in the future. As more data is generated and freely flows between platforms, these networks will thrive together.

We have also seen how combining speculative elements such as friend. tech’s keys can create viral propagation. With the emergence of PWAs and Layer 2 solutions that enable low-cost transactions, onboarding users to killer web3 social applications will become easier. Soon, users will be able to transact seamlessly as in video games.

Cryptocurrency has brought new monetization methods for creators. Whether it’s Focus’s paid reposts and paid messages or friend. tech’s key royalties; cryptocurrency can eliminate any payment friction, allowing creators to expand their viewership and maximize their earnings. Thus, they can find the most suitable ways to monetize their content.

Utilizing crypto incentives to address the cold-start problem of networks holds much promise. In the past, Blur surpassed OpenSea in quantity by introducing airdrop seasons. The traders with the highest trading volume will receive more BLUR tokens. By targeting influential creators and influencers from web2 platforms using crypto incentives through Focus, we see platforms employing this strategy attract the most influential creators and influencers from platforms like X, YouTube, and Instagram.

In the coming years, social applications and networks will not only connect users but also leverage elements of cryptocurrency foundational blocks such as open data, tokenization, ownership, and identity, bringing millions of users into the cryptocurrency space. At Pantera, we look forward to accelerating the future of web3 social.

——paul veradittakit

Disclaimer：

1. This article is reprinted from [marsbit]. *Forward the Original Title‘Pantera Capital合伙人：Web3 社交版图’.All copyrights belong to the original author [PAUL VERADITTAKIT]. If there are objections to this reprint, please contact the Gate Learn team, and they will handle it promptly.
2. Liability Disclaimer: The views and opinions expressed in this article are solely those of the author and do not constitute any investment advice.
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