Exploring the Opportunities and Mission of Web3 Social

Recently, the Web3 discourse is filled with hostility, and both insiders and outsiders generally believe that Web3 is a hotbed for scamming. However, in reality, the Ponzi model is merely a financing technique that reduces project operating costs, paving the way for the ultimate success of the project. Whether in DeFi, social, or other sectors, there have always been builders who persevere and strive. As long as the pace of progress does not stop, the Web3 revolution has not failed. All technological innovations emerge in a wave-like manner, and short-term lows are insufficient to negate the industry's prospects. We firmly believe in the power of crypto and look forward to a decentralized future.

This article will outline the development of the Web3 social field over the past 8 years across two cycles, summarizing experiences and lessons learned, and exploring potential opportunities and blueprints. Although Web3 social has not yet fully matured, the progress in the industry is still notable. Different people have different expectations for Web3; some hope for a better experience, while others seek more complete personal data sovereignty. As Web3 technology continues to advance and barriers and costs decrease, the emergence of real products may very well be happening now.

The Underlying Demand Theory of Web3 Social

Successful products must be built on solid demand. Web3 projects are often criticized for failing to integrate with the real economy. To break the prejudice that "Web3 is just for harvesting leeks", we need to fundamentally prove the demand for social interaction in Web3.

As social animals, humans have an innate need for social interaction. This has been repeatedly validated by numerous social products. People need to connect with others to perceive their emotions, attitudes, and psychological activities, and to obtain feedback to adjust their own emotions and cognition. This need is as fundamental as eating, drinking, and breathing; it is an instinct embedded in our genes through the process of evolution. In short, the basic needs for social interaction are connection, mental interpretation, and self-regulation.

Holding tokens provides a new way to connect. An open and verifiable database expands the dimensions of information we gain from interactions. The new information environment will foster new types of social relationships and ways of interaction.

The psychological motivations behind most social behaviors on the internet can be summarized as: self-presentation, emotional venting, and seeking recognition. Compared to traditional offline socializing, the internet has created more social scenarios through multimedia. From forums, BBS, chat rooms to blogs, instant messaging, social media, and gaming spaces, China's Bilibili has even creatively produced bullet comments. These new scenarios encompass different interpersonal networks, content, and presentation styles, giving rise to a batch of successful projects.

The development of social interaction on the internet is characterized by economies of scale. Historical experience shows that projects that cannot establish economies of scale in social activities under specific populations and purposes are difficult to survive. Compared to the millions of concurrent users of global Web2 social giants, the scale of Web3 social interactions is even less than a fraction of that. Economies of scale are like a mountain; without forming economies of scale, it's hard to escape the fate of being subsidized to death. The scale of social networks and content determines whether social nature and motivations can be better realized. How can products without scale help users expand their social relationships? How can personal displays and empathy with others be achieved?

The development direction of Web3 has been determined since the concept was proposed. In short, it is the industrial ecology supported by a trustworthy and open data environment and the financial environment backed by tokens. How does this environment foster a brand-new industrial pattern? With underlying information support across databases and organizations, the ability to freely choose the front end and the composable, pluggable social interface is a unique advantage of Web3 social. Tokens are a typical feature of Web3, using social support for token issuance, with the core content being the quantification of rights interactions by tokens. The scenarios for organizing social relationships are unique application scenarios of Web3 social.

In recent years, the Web3 industry has indeed gone to great lengths to gain scale advantages in the niche social market.

The Development Context of Web3 Social

This section aims to illustrate that Web3 social continues to progress, with the industry accumulating lessons learned and continuously advancing technologies driving us closer to the tipping point of industry explosion.

The advantages provided to entrepreneurs by the Web3 environment have led to two parallel trends in the development of social projects:

1. How to develop decentralized social technology standards
2. How to Build Token Consensus Through Social Networking

Competition of Decentralized Social Technology Standards

If we consider humans as social animals, and that information input determines what kind of people we are, then the power of internet social platforms is immense. We can hardly imagine the serious consequences of handing over this power to companies and governments. Losing sovereignty over social information means we also lose the freedom of cognition and choice. The Facebook data leak scandal led by Cambridge Analytica shows us how easily our will can be manipulated. How much we and future generations need to have control over our data sovereignty. Therefore, decentralized social technology solutions are a necessity for the future.

To achieve decentralized social networking, breakthroughs must be made in communication protocols, data, and applications. The communication technologies used for achieving global consensus on the blockchain may not be suitable for decentralized social communication. Therefore, building on the experience of STEEM, the new generation of projects such as Bluesky, Nostr, Lens, and Farcaster have proposed their own decentralized social protocols. By sacrificing some aspects of data decentralization, all protocols have made significant progress. On any protocol, imitating Web2 social tools is no longer an issue, and even due to the realization of decentralization, user autonomy is enhanced. Users have the right to maintain their intangible assets within the system. However, as mentioned earlier, Web3 businesses face significant scale disadvantages.

Technology is not the issue. The challenge facing all proposed solution projects is how to move the mountain of economies of scale that blocks the road to success. To penetrate this disadvantage, token incentives have become the most direct means for most projects in the short term.

Token incentive revolution encounters obstacles

The birth of tokens is like opening Pandora's box. From the moment all Web3 users step into the industry, they are forced to confront a complex financial environment. For project parties, adopting tokens can act as subsidies for user desires and reduce operational costs.

The revolution of token incentives faces two major dilemmas in social environments:

1. The subjective value of social content is difficult to assess, and the effectiveness of token incentives is questionable.

2. Token incentives face witch attacks.

These two issues have yet to be completely resolved; introducing a case helps with understanding.

The STEEM blockchain can be considered a pioneer of the entire Web3 social industry. To this day, not only are many of the concepts and structural designs it proposed still imitated and referenced by current projects, but it has also nurtured a group of blockchain application teams and projects. In 2016, the STEEM blockchain initially made innovative attempts in various dimensions such as token incentives for content, token incentives for real person curation, data availability layers, and account hierarchical security.

Applications built on the STEEM blockchain are a form of social media, where the quality of media content is determined by users weighted by the amount of tokens staked. In the early stages of the project, the founding team had an absolute advantage in both reputation and the quantity of staked tokens. At that time, content production and filtered recommendations based on token staking weight were effective. Like most token incentive projects, a huge wealth effect attracts a swarm of predators. However, the token staking on the STEEM blockchain includes punitive power, which can immunize against predator attacks to a certain extent.

This validity is based on the centralization of assets and power, as well as a solid foundation of consensus. When the founder BM left, the founding team fell apart, and the project was sold to the notorious Sun Yuchen, resulting in a collapse of consensus. In the early stages, the collapse of consensus led more individuals to profit through witch-hunting tactics: users holding coins liked each other, and proxy mining ran rampant. Later, when algorithm recommendation systems and AIGC technology matured, this content production and recommendation system based on token-weighted voting reached its exit from the historical stage. The current top social media platforms have achieved user content that is tailored to each individual; this refined selection of content is beyond the reach of human resources combined with purely content-tag-based sorting and pushing.

After STEEM, many projects have used token issuance to accelerate platform expansion, such as Torum, BBS, etc. Those who want to scale have adopted token incentives. Of course, later on, there are also protocols like Lens that use the expectation of free riding. These incentives violate the "non-monetary reward" element of social interactions. Experiments show that external material rewards can reduce intrinsic psychological rewards, which causes non-social content to mix into social content. Social links are information channels, and the value of social platforms lies in aggregating information within these social channels. However, such mixed incentives have led to a decrease in social efficiency. The already information-scarce channels now have to face more noise, and decline is a natural consequence.

Like Degen on Farcaster, part of the tokens are given out as rewards. This is the unique financial function of Web3 that uses Meme tokens to incentivize social projects, rather than content creation or recommendations (. By introducing crypto social finance attributes, it creates a wealth effect and triggers ecological prosperity. A platform can only have one token, but it can have countless Meme tokens. Meme tokens can fail, but platform tokens cannot. Using Meme tokens to boost social projects will become a superior technique for token incentive platform projects. The wealth topics of Degen, combined with the innovative possibilities on Frames, have encouraged more and more builders to participate in Farcaster, triggering ecological prosperity in the Farcaster ecosystem. It can be said that, so far, I personally believe: this is a classic operational campaign. The ecological emergence brought about by this operation cannot be ignored. Currently, the ecosystem has produced tools including NFT piggy banks, various streaming ) voice chat rooms, short videos, GIFs (, and launch platforms. Although I haven't found signs of Farcaster breaking through the business boundaries of Lens ) or the current industry bottlenecks (, this emergence is worth focusing on.

![In-depth exploration of the opportunities and mission of Web3 social])https://img-cdn.gateio.im/webp-social/moments-8cab9bf6098a6f32d479b0546ba377c6.webp(

) Content autonomous revolution phase setbacks

Web3 focuses on decentralization, which in business means breaking monopolies.

The starting point for Web3 social should be around 2016-2017. At that time, Web2 social products were developing rapidly. In the last two cycles, social projects were all focused on independent narrative of content. Various projects attempted to put content "on-chain," and based on the "on-chain" content, they could work on content assetization.

Launched in 2016, STEEM has fallen behind due to the disintegration of its project team and slow development progress. Although the project achieved content on-chain at launch, it lacks an EVM environment and cannot run smart contracts, leading to a gradual decline after the DeFi summer that began in 2020. The crown of content on-chain has been taken over by Mirror. Mirror's selling point is that it provides a user-friendly text content editing environment. Users can sign with their wallet to publish their text content. Content is on-chain and cannot be tampered with. Other users can subscribe to and follow specific accounts. Content can also be minted into NFTs and traded in the NFT market. Currently, the project is still operational, though traffic has decreased; however, some Degen players continue to use the project to publish content and engage in content NFT minting activities.

Mirror is an excellent Web3 product that embodies a minimalist design philosophy and effectively utilizes a trusted and open database. Anyone can assert rights over internet content data through wallet signatures. After rights assertion, the content can be issued as NFTs and traded in an NFTfi environment under the EVM. The essence of Mirror's user attrition is that, compared to traditional Web2 content operators, it not only lacks operational capabilities but also, written content, especially lengthy articles, inherently lacks traffic and is a byproduct of the age of garbage culture. At the same time, there are projects that focus on audio and video to bring content on-chain. Discussing content incentives is ineffective; the massive data volume makes project operating costs unsustainable. Doing a content business is akin to doing media. You either have good content to attract users, or a large user base to attract good content. Simply providing a technical solution cannot turn into a business.

At the end of 2023, another content-based project emerged. Bodhi is also a minimalist product. Inspired by Friend tech, Bodhi no longer mints associated content NFTs at a uniform price, but adopts bonding curve technology for price differentiation; the more sold, the higher the price. It also forcibly replicates Web2 content on the blockchain like CloudBit.