Decentralized Twitter raises $15 million. Is the social track approaching a singularity?

Author: Revc, Golden Finance

Foreword  

Bluesky recently completed a $15 million Series A financing, led by Blockchain Capital, and followed by SevenX, True Ventures, Alumni Ventures and other institutions. This funding will help Bluesky further build its decentralized social experience while ensuring that the platform will not be "over-financialized" through crypto tokens, NFTs or other blockchain technologies. Bluesky emphasizes that its goal is to create a social platform that is not controlled by a single company to protect users' freedom of speech and data privacy.

After Friendtech died down, the social track once again ushered in large-scale financing. However, Bluesky's financing goal is to avoid excessive "financialization". In contrast, Pumpfun, the most successful MEME token platform in Web3, is actively enhancing its social attributes and launching features such as live broadcast and video token issuance. On one side is a PVP project with sufficient cash flow and a focus on finance, and on the other side is Bluesky, which temporarily relies on VC transfusions. Bluesky goes left, Pumpfun goes right, who is the future of SocialFi?

Bluesky

Bluesky is a decentralized social platform that aims to give users more freedom and control. Its user base has exceeded 12 million, making it a strong competitor to Elon Musk's X platform. The latest data shows that Bluesky has added more than 1 million registered users in just 48 hours. This surge is partly due to changes in the privacy policy of the X platform - allowing third-party AI developers to use user data to train models, which has raised users' concerns about data privacy and transparency.

In addition, the X platform recently adjusted its blocking function, weakening users' control over content visibility. This change has been widely criticized for potentially increasing the risk of online harassment. In contrast, Bluesky pays more attention to the user's autonomy over the social experience, allowing users to customize their information flow, choose the content and users they follow, thereby reducing information overload and unnecessary interference. Such a flexible design has greatly attracted new users to register and become active on the platform.

How Bluesky Achieves Decentralization and Autonomy  

Decentralized Identifiers (DIDs)  

Bluesky's core concept is decentralization, where users own their own data and identity. Through decentralized identifiers (DIDs), users' data is protected on the network, avoiding the control of their content by a single company. DIDs enable users to migrate freely between different platforms, ensuring true account portability.

Personal Data Server (PDS)  

Users can choose to run their own personal data server (PDS) or use a PDS hosted by someone else for them. This design not only enhances users' control over their own data, but also ensures the security and privacy of the data. User-created content is cryptographically signed to ensure its authenticity and immutability.

Authenticated Transfer Protocol (AT Protocol)  

Bluesky is built on the Authenticated Transfer Protocol (AT Protocol), a federated protocol for distributed social applications. The AT Protocol allows different servers to communicate with each other, ensuring that parts of the system can be run by multiple people. This federated design allows Bluesky to deliver on its promise of "not being controlled by a single organization."

The AT Protocol was designed with scalability in mind, allowing the system to remain efficient as the number of users increases. It reduces reliance on a single server by distributing the load to participants who can handle it. This design enables Bluesky to maintain a stable service quality despite the rapid growth in the number of users.

Financialization

Currently, Bluesky's design advantages may need to be stimulated in specific market environments, such as when freedom of speech is threatened or privacy leaks cause panic. However, this demand is relatively extreme, similar to the "empty city" phenomenon of some Ethereum protocols. From a product perspective, Bluesky has not yet reached the basic functions and UI level of the Web2 platform. How do you evaluate Bluesky's non-financialization strategy? Is its future prospects worth worrying about? At present, relatively mature SocialFi products are developing along two routes: 1. CreatFi (niche NFT artists or topic communities) - NFT - Bonding Curve (Friendtech) - SocialFi 2. Pumpfun - MEME - Bonding Curve (Friendtech) - SocialFi Among them, the first path is mainly non-financial, but it is obviously backward and currently relies on VC transfusions to maintain operations. Since Web3 has not yet been widely popularized, an effective balance point between expenditure and income has not yet been found to support the operation of the project. As Pumpfun strengthens its investment in social content (such as live broadcast and video token issuance), it is very likely to establish its position as the top social protocol of Web3. Therefore, in the current Web3 environment, the financialization of projects is a strategy that cannot be ignored, and Bluesky's differentiated advantages in the broader North American market where Web2 and Web3 are integrated may take time to emerge.

Let's not discuss Farcaster for now. Its current advantage is that it maintains a small Web3 elite community and lacks the social cultural gene of sinking. Farcaster's charging threshold design is more conducive to establishing a robust and non-FOMO discussion atmosphere in the early stage of the community.

Thinking Wandering

As Joel John of Decentralised.co said: "Look further away, and you will find that the basic elements we need to build the future exist at this moment."

The core advantage of Web3 social lies in its fast, low-cost, two-way micro-value transfer under its decentralized architecture, thereby improving the efficiency and fairness of value exchange and empowering every subject in the social network, including creators.

New social experience drives user migration——"When we study the nature of social networks, we find that existing networks have not been replaced by better alternatives. They are subverted by products with similar functions but completely different experiences. TikTok is not a better Instagram, nor is it a better Twitter or chat tool. The future of Web3 social will not be a 'better Twitter', but will more likely be based on the current successful attributes of the industry, bringing speculative, verifiable rankings and ownership." —— Joel John, Decentralised.co

Can MEME and NFT constitute a new social experience? The answer is yes, as evidenced by the initial burst of trading volume, but overly strong financial attributes often lead to Ponzi or zero-sum games, hindering the large-scale application of Web3 and causing the "scythe" to always swing to latecomers. Can this situation be changed? It is possible, but it will take time. Only when users have room to earn benefits can the pattern gradually take shape.

The scale of social networks directly affects the social instincts and motivations of users. Has Pumpfun achieved economies of scale? At present, it is more like a PVP game between crypto stock users, but in addition to the huge fee income, Pumpfun may be exploring the product form of Web3 social. Pumpfun now supports the issuance of video tokens - will it become the "Web3 version of TikTok"?

Does the picture below inspire your imagination? The waterfall page seems a bit outdated. Pay attention to the NFT display area of ​​the personal homepage and the video token section on the left. Note: The picture below is from a Web3 social product.

While Web3 developers are still exploring the possibilities of information flow, tokenization, NFT and Friendtech, Pumpfun directly combines video with MEME token issuance. Pumpfun may be the prototype of the future development of the SocialFi track. All its content forms and social relationships will eventually point to asset issuance.

Currently, Web3 is still difficult to achieve economies of scale, and it is difficult to support large-scale applications only for the needs of a small number of users. The economic model that maintains the operation of the project is also designed for a small range of Web3 users, and the product cannot easily escape their cognitive experience. There is a "generation gap" between Web3 and Web2 users in product cognition: early Web3 users were mainly Bitcoin miners, while now Web2 applications have targeted users born after 2000 and 2005, focusing on their favorite "Egg Party and Golden Shovel". Are most Web3 social projects in the Chinese-speaking area still active? What are the new explorations? Pure - Detiktok, a slightly marginal example, a decentralized creator platform. Pure is taken from the meaning of clarity. In the early days of Douyin's explosion, the marginal content attracted attention while leading to the decline of human aesthetics. While the diversification of modern cultural consumption orientations has brought people more freedom of choice, it has also caused people to lose the moral judgment standards for diversified consumption concepts under the dominance of cultural consumerism and sensory desires, bringing confusion in cultural consumption value choices and confusion in value orientation, and even causing confusion in moral orientation to a certain extent. Pure wants to change this situation.

However, Pure (Detiktok)'s target users have gradually withdrawn from the circle in 2021. Faced with multiple market crashes and the impact of Ponzi, Web3 has failed to attract new traffic in the Chinese-speaking area, so most of the current Web3 projects are still focused on the construction of the financial field.

Pure not only provides short videos, AI creation and dynamic information flow functions, but also adds Friendtech and NFT functions. So how can NFT be integrated into the information flow? The key is to retrieve NFT metadata through API service providers for display. If content can be converted into NFT assets and has the ability to visualize and quantify the value of future cash flow, then this incentive model is feasible.

Xitai-Why did Pumpfun add short video and live broadcast modules? It is because short videos can greatly enhance the visual impact and emotional resonance of MEME materials during the dissemination process, thereby triggering viral transmission.

I once suggested that the founder of Pure write a financing deck, and his answer was also very Buddhist: "I often have a lot of exciting ideas flashing through my mind, and it feels difficult to record them. In contrast, it is much easier to write a notice of suspension of operations. It is difficult to form a warm and emotional consensus with others on the understanding of the project or track, and the operating mode of VC coins makes people very uncomfortable."

What kind of information flow incentives should Web3 social have?

Information flow usually consists of creative content and advertisements. If Bonding Curve is the standard of Web3 social 1.0, then "Parabola" may be a must-have option for social 2.0. The incentive mechanism of social networks should be established based on the contribution of creators to the user's usage time. In the user's information flow, the content before and after the advertising clips should be most motivated. At the same time, it is crucial for AI to ensure the fairness of the information flow recommendation algorithm.

Summary  

Is the Web3 social singularity approaching? The charm of the current Web2 algorithm platform lies in the continuous introduction of fresh content, accurate push, and firmly grasping users. Pumpfun seems to have done this, but it stimulates dopamine production through financial means, and the user's motivation is profit.

Bonding Curve is the main line of Web3 social products, which can cover the time cost of Web3 users and feedback their expected returns. The optimistic judgment is that the Web3 social singularity has arrived.

With the rise of the application layer chain wave, Web3 is expected to move one step further towards large-scale adoption. After completing the 0-1 concept exploration in Europe and the United States, the Chinese-speaking region is expected to take over the baton in the construction of Web3. Generally speaking, the social atmosphere in Europe and the United States is more likely to produce novel product forms, but the operation and development iteration capabilities of the Chinese-speaking region have unique advantages in the 1-10 stage, and the regulatory environment faced by the Chinese-speaking region still constrains the development of the industry in the long term.