Farcaster - SocialFi Infrastructure
Project Background
In May this year, a16Z invested in two projects, Neynar and Kiosk, both of which were built on Farcaster.
Among them, Neynar founder Rishav (Rish) Mukherji was a group product manager at Coinbase and has experience at Meta and Microsoft; co-founder Manan Patel was a senior software engineering manager at Coinbase and has experience at Uber and Mirror.
Kiosk founder Denis Nazarov is also the founder of Mirror. Previously, he was an advisor to Uniswap Labs and an investment partner at a16z.
Farcaster raises $180 million, valued at $1 billion
Its founder, Dan Romero, is the former vice president of operations at Coinbase, and co-founder Varun Srinivasan was in charge of platform development at Coinbase.
Coinbase’s main investment institution is a16z. It can be seen that this is actually a circle. a16z wants to build an entire ecosystem based on Farcaster. There is huge room for imagination. The relationship map is as follows:
Project Introduction
Farcaster is a fully decentralized social protocol. Within the Farcaster protocol, each user can directly connect and interact with another user without being restricted by the platform. Developers can also build their own applications based on existing users and public data in the protocol without permission.
As we all know, most people spend a lot of time on online social applications every day, generating a lot of browsing data. In many cases, the content that users browse is not output by the platform, but contributed by countless content creators. The platform has absolute say in the exposure opportunities of content, and the relationship between users and their content subscribers is almost completely controlled by the platform. As the owner of this data, traditional Web2 social platforms apply this data to various types of precise advertising through various algorithms, and obtain a lot of benefits. Moreover, after these platforms are built to a certain scale, due to the agglomeration effect, new applications are also very difficult to compete with them, making them giants. At the same time, the platform also has the right to ban a creator at any time, so that his work can no longer be exposed on the platform and interrupt the connection between the creator and his content subscribers.
In view of the existing status quo, under the context of Web3 and with technical support, new social protocols are needed to meet the needs of users and completely break the existing model. In Web3, users are the only owners of their own data, and user data is completely in the hands of users, not a certain platform or a certain giant. The user's identity can also be unified across devices and applications. The content created by them, no matter what form, whether it is images, videos, posts or other users' interactive data, will not only exist in the database of a certain platform, but belong to the users themselves and the public data can be used by everyone.
Farcaster is one of the decentralized social protocol solutions. As an underlying protocol, Farcaster has established a series of behavioral norms, stipulating how to establish user identity, how to manage personal data in the protocol, how to store and how to ensure the consistency of multi-node data. These norms ensure that developers can use their creativity to create different applications based on the Farcaster ecosystem, based on existing users and data, thereby building a new form of decentralized social protocol.
vernacular:
Farcaster is a low-level identity protocol. The data belongs to the user himself. Any developer can develop applications on this protocol based on the user's public data, such as WeChat, Weibo, etc. All applications share a common data system.
Technical principle
Decentralized social protocols encounter many problems when designing, such as: users must be able to create, control, and transfer accounts in a decentralized manner, and messages created by users must be updated at near real-time speeds, etc.
The solution provided by the Farcaste protocol uses a combination of on-chain and off-chain methods. On-chain contracts are used for infrequent operations, where consistency and decentralized management are very important. Accounts, usernames, and how much storage space they have are managed using a series of Ethereum contracts.
The off-chain system is used to record frequent operations, and performance is critical. Messages created by user accounts are stored in Farcaster Hub and delivered through its peer-to-peer. Unlike the strong consistency requirements of blockchain, Farcaster Hub uses an eventual consistency model, a weaker consistency model, to achieve fast message propagation.
On-chain contracts are used for infrequent operations where consistency and decentralized management are important. Accounts, usernames, and how much storage space they have are managed using a series of Ethereum contracts. Off-chain systems are used to record frequent operations, and performance is critical. Messages created by user accounts are stored in the Farcaster Hub and delivered via its peer-to-peer messaging. Unlike blockchains, which have strong consistency requirements, the Farcaster Hub uses an eventual consistency model, a weaker consistency model, to achieve fast message propagation.
In terms of overall design, the design architecture is divided into the following three layers:
The bottom layer of the protocol is the management of user identity information. It specifies how to create and manage accounts, how to facilitate user use in cross-device scenarios, and how each user's storage space is recorded and managed.
In the middle is the data layer, Farcaster Hubs, where user-posted content data, sent messages, likes or comments on other users’ content, and interaction data between multiple users are all processed and recorded.
The top layer is the application layer, which is the various applications built by all developers based on the underlying user data and the content data recorded in the middle Farcaster Hubs.
Economic Model
To achieve decentralization, the cost of data storage is a factor that must be taken into consideration. The solution proposed by farcaster is that users pay a certain fee annually to "rent" a certain amount of storage space. The price of the storage unit is determined by the Farcaster team and will be adjusted appropriately according to the supply and demand relationship. For users, they can "rent" the corresponding amount of storage space according to their own usage needs. Such a mechanism can encourage each user to cherish the use of storage space and spontaneously retain only necessary information. It can also prevent a large amount of spam from flooding the entire data, which brings unnecessary burdens to developers and data nodes. This design also makes the Farcaster protocol more sustainable in terms of economic utility.
User Data
Treasury income
Advantages of the protocol
● Data sovereignty returns to users
In a decentralized social protocol like Farcaster, user data belongs only to the user. The user's data is recorded in the tamper-proof on-chain smart contracts and the off-chain Farcaster Hubs.
● Data sharing improves communication efficiency
In web2, data is isolated between platforms. We can see that many content creators need to publish the same material on Xiaohongshu, Douyin, and Bilibili. In the web3 world, after breaking the platform restrictions, users only need to manage in one place, and different clients will still present different forms of content to meet users' daily consumption needs for different content forms.
● Copyright protection
The transparent, decentralized, and tamper-proof nature of blockchain itself has a natural ability to protect user copyrights.
● Team background
Top capital support, strong background
Problems
● User scale
Social networking depends on the scale of users. At least for now, X is still the largest web3 community. How to attract more users is a problem that all web3 social products need to solve.
● Usage threshold
In actual use, it costs $5 to register an account using the official warpcast. Although it is impossible to block cryptocurrency users, it certainly discourages many ordinary users. In real business logic, many products are first given free user experience, and then attract users through good experience, thereby generating repurchase behavior.
It’s not just about fees. For non-Web3 users, there’s also the cost of understanding new technologies. For example, how to properly secure the EOA mnemonics of your own FID hosting, and why you need to pay fees. Although this is a problem that all Web3 applications will face, as a social protocol that requires a user scale effect, it is particularly important to better guide new users.
● No blockbuster apps
At present, the applications on this protocol are still based on the mainstream products of web2, and similar experiences are established on web3. If only the functions and user experience are aligned, it will be difficult to compete with web2 companies.
Imagination space
Farcaster provides a complete solution, which opens up a wide range of imagination for the entire decentralized social track. At the same time, the Farcaster team is still actively promoting the construction of the entire ecosystem, and everyone is extremely optimistic about the future of Web3 decentralized social protocols. However, it must be admitted that the entire decentralized social track is still in a very early stage and needs to be continuously built, that is, it has not yet experienced a stage similar to "Def Summer" to allow various ideas, creativity, and projects to gush out and bring users a new narrative experience. Of course, based on the advantages of decentralized protocol data openness, in the future, with the gradual increase in the scale of users and the innovation of the application layer above the protocol, the increase in the possibility of these market detonation factors will make the vision of large-scale adoption of the decentralized social track possible.
Similar Projects-Lens Protocol
Project Background
Stani Kulechov, the founder of Lens, is also the founder of Avara, the parent company of AAVE. Paris Rouzati, the head of Avara’s ecosystem, once worked as a partner at IDEO CoLab, the lead investor in Lens.
Lens has raised $15 million in funding, and it is reportedly seeking $50 million in funding, bringing its post-funding valuation to $500 million.
Compare to Farcaster
● User scale
Lens has the first-mover advantage and was officially launched on the Polygon mainnet on May 18, 2022. It currently has 397K users, higher than Farcaster's 280K.
● Technical ideas
The original intention of Lens Protocol in building the entire set of protocols is consistent with Farcaster. That is, both return the ownership of data to users and replace the closed databases and centralized servers of major Web2 social platforms that are still in a zero-sum game with open protocols.
In terms of protocol design and implementation, Lens Protocol is another solution. In the protocol design, in order to save all data on the chain, Lens Protocol designed a full NFT data flow. First of all, the user identity is a Prole NFT, and this Profe NFT represents the identity in the Lens protocol. The user's behavior in the Lens protocol ecosystem, whether it is posting content, commenting, forwarding, liking, etc., is also abstracted into interactions between NFTs.
● Data storage
Compared with the data storage solution that combines on-chain and off-chain with Farcaster, all data in Lens is stored on the chain, and users can share identity information and their own social graphs in all applications within the ecosystem.
But this also brings considerable user usage costs and on-chain Gas costs. First of all, the cost of use. Users need to sign for each operation, which makes the user experience very unsmooth. Fortunately, the team is also aware of this problem and has provided a solution called Signless. Users can decide whether to enable this feature. Secondly, the Gas cost is definitely an issue that cannot be ignored when all information is recorded on the blockchain. At present, for the sake of user experience, Lens pays Gas for users. Although the team chose Polygon, a relatively low-cost chain, when the number of users is too large, this cost will not have a diminishing marginal cost effect and will only increase exponentially.
Summarize
In the SocialFi infrastructure track, Farcaster has stronger investors and a more powerful team background. a16z boss Chris Dixon mentioned Farcaster in many interviews, and increased investment in May this year, as well as investment in related ecological projects, which shows his confidence.
In terms of technical implementation ideas, Farcaster's on-chain + off-chain solution provides a better user experience. It does not mean that Lens' full-chain solution is not good, but in the current blockchain infrastructure, in order to ensure the cost and speed of user interaction, it is more appropriate to adopt an off-chain solution. Farcaster is more suitable for the current era.
"Defi summer" was an enlightenment for cex users to enter the on-chain ecosystem in the last bull market. So in this bull market, is it possible for "SocailFi" to become an enlightenment for on-chain web2 users to enter the web3 ecosystem? As long as there is some wealth-creating effect (similar to meme coins) driven by capital, I think it is very likely.