Original title: The Rise of Decentralized Social Networks
By Lorenzo Sicilia, Head of Engineering at Outlier Ventures
Compiled by: Chris, Techub News
Decentralized social networks (DeSo) are gradually attracting real user attention, such as Farcaster and Lens Protocol have begun to show their potential in the market. As encryption technology gradually matures, it is becoming more practical and efficient, gradually overcoming the difficulties of private key management and user experience, which are important factors hindering widespread adoption.
In this article, we will explore several major crypto-decentralized social media platforms in detail, analyze their functionality and architecture, and explore the opportunities for Web3 founders in building new permissionless social graph protocols.
Social network
Traditional centralized social networks, such as Instagram, Facebook, and Twitter, are built around user needs and provide personalized information streams. These platforms have built up huge user databases and turned user data into commodities to attract users' continued attention.
In contrast, decentralized social networks aim to break through these limitations and truly return control to users by providing identity portability and enhanced privacy controls, simplifying the transition of users between different platforms.
DeSo platforms, like cryptocurrencies, provide permissionless trading opportunities for anyone around the world, as well as permissionless communication and uncensorable broadcasting capabilities. This model not only attracts users, but also provides developers with the freedom to innovate on existing protocols without the need for permission from traditional gatekeepers, similar to the "Lego" effect in the DeFi field.
Before the rise of Web3’s DeSo, Mastodon was one of the few platforms that attempted decentralized social networking. Although it benefited briefly after Elon Musk acquired Twitter, Mastodon’s growth eventually stagnated due to issues with usability and fragmented user experience, with only 1 million daily active users.
Today, Farcaster, Lens, and other projects are trying a different approach to building on Web3, bringing something new to the table.
SocialFi
SocialFi is a decentralized financial model that integrates Web3 elements into the social network graph. In this ecosystem, participants such as content creators, Internet celebrities and ordinary users all expect to have better control over their data and freedom of speech, and to gain benefits through their social media influence and user stickiness.
In SocialFi, monetization is primarily based on cryptocurrency, while user identities are managed through a series of private keys. These participants can also resist censorship through decentralized autonomous organizations (DAOs), although the effectiveness of this mechanism is still being explored.
Several key differences between SocialFi and traditional social networks include:
Token-gated areas: Only users holding specific creator tokens can access specific features or content areas.
Tipping: Users can tip creators directly in cryptocurrency, either the platform’s native token or other types of tokens.
Subscription model: Users can purchase digital goods or services through one-time or recurring subscriptions using cryptocurrency.
Platform incentives: Based on the participation of users and creators, they can receive platform tokens as incentives.
The first of these innovations was made possible by Friend Tech, which explored the use of so-called “key” tokens to access token-gated chat areas. These tokens are not only tradable, but also allow users to benefit from the popularity of content creators.
Although friend.tech had 800,000 unique user addresses at its market peak, its user retention rate has since dropped significantly, demonstrating the challenges and limitations of the model.
While bonding curves are good at driving adoption by creating a sense of urgency and FOMO, they fall short in terms of user retention over the long term. To truly keep users sticky, two key elements are required: a network effect that amplifies the value of the platform as more users join, and clear long-term utility that provides tangible benefits beyond short-term gains.
Web3 Social Graph
Social graphs can represent relationships between entities, such as people, organizations, places, and anything else that can be related to each other. Web2 entities like Facebook, Twitter, Instagram, and TikTok have accrued significant network effects, particularly in discouraging users from joining other social sites because switching networks means starting all over again.
Projects like Lens, Farcaster, and others are building differentiation from this point of difference by starting to develop true open graphs with multiple front ends that leverage the same data to provide different user experiences.
Yet, Facebook generates 4PB of data every day. Every minute, 510,000 comments are posted, 293,000 status updates are made, 4 million likes are received, and 136,000 photos are uploaded. No blockchain currently in existence can handle this volume of data, and it may never be able to, because blockchains are optimized for a different type of use case: permissionless exchange of value.
For example, double spending, a classic blockchain financial risk, is irrelevant in a decentralized social network that handles usernames, content distribution, and notifications. The Lens and Farcaster teams should consider different assumptions with various pros and cons.
Lens Protocol
The Lens protocol is an innovative composable social graph developed by Aave founder Stani Kulechov and currently running on the Polygon blockchain. This protocol is community-centric and aims to be fully driven and governed by the community.
The architecture of the Lens Protocol is based on several key smart contracts that together handle various aspects of the social network:
Profiles: In the Lens protocol, users' profiles are represented by NFTs. Users who own a Profile NFT control their social graph and the content they publish. A Profile contains a history of all the user's Posts, Quotes, Mirrors, Comments, and all other user-generated content.
Publications: This represents the content elements in the protocol and is divided into four types: Posts, Comments, Quotes, and Mirrors. Among them, Posts is the basic content unit, and the other three are extensions of Posts. Each publication is associated with a ContentURI, which points to content such as images and text stored on decentralized storage solutions (such as IPFS, Arweave, or AWS S3).
Interactions: Mirrors, Comments, and Quotes allow users to interact, such as by commenting, quoting, or sharing content. These interactions follow certain rules, such as only followers can quote, comment, or mirror.
Open Actions: This is designed for developers and provides a way to build custom functions that can be directly embedded in the protocol. These can be thought of as hooks triggered by the protocol. For example, when Alice receives a tip from Bob, an indexer that tracks earnings can be automatically triggered by the protocol.
The Lens Protocol is designed to increase transparency and user control on social networks while providing developers with the flexibility to innovate on existing protocols without the need for permission from centralized authorities.
From the beginning, the Lens team focused on the protocol itself and let the community take charge of the front-end construction, so many different UIs were created, each with its own style.
The result is a vibrant ecosystem, albeit one that is somewhat chaotic, with many projects disappearing within a few days of launching. However, we are gradually seeing a consolidation of projects such as buttrfly, hey.xyz, and orb that are gaining traction.
After running Lens v1 for a while, Lens launched Momoka, an Optimistic L3 that goes beyond the blockchain space. Instead of storing data directly on Polygon, they leveraged the Data Availability (DA) layer, which reduced costs simply by uploading data to Arweave.
Farcaster
Farcaster is another Web3 social network built on Ethereum that utilizes on-chain smart contracts and a peer-to-peer network matrix based on the "Hub" client.
Similar to Lens, Farcaster is open and has spawned many different clients based on it, the most popular of which is Warpcast, which was developed by the Farcaster team itself, as well as Supercast (with paid features) and Yup (focused on cross-posting).
In 2022, Varun Srinivasan published a blog post on “Sufficient Decentralization” that laid out some ideas that have been at the core of Farcaster’s architecture and approach ever since.
The main idea is that a social network is sufficiently decentralized if "two users on it can find each other and communicate across other barriers on the network."
To do this, you need to:
Get a unique username
Post messages under this username
Read a message from any valid name
Farcaster implements its architecture through a set of core smart contracts deployed on Optimism:
IdRegistry creates new accounts and allows users to transfer and recover Farcaster accounts. It also integrates with ENS to make usernames available to their rightful owners.
Storage Registry rents storage to accounts. Storage prices are denominated in USD and converted to ETH using Oracle. Prices are based on supply and demand.
Key Registry publishes app keys with accounts so they can publish messages on their behalf.
As you can see, none of the above smart contracts send or receive messages, this responsibility is delegated to Hubs. Hubs is a distributed network consisting of Hubble instances, which are nodes built using Typescript and Rust.
Each node is responsible for validating, storing, replicating messages, and evaluating its peers.
Message-level authentication is performed by verifying a valid signature from a user account key.
Once the message is verified to be valid, it is stored in the hub through an asynchronous process that utilizes the CRRDT (Conflict-Free Replicated Data Type) approach.
Replication is implemented using a diff sync and gossip protocol based on the popular libp2p codebase. The Hub periodically selects a random node to perform a diff sync, comparing Merkle tries of message hashes to find missing messages.
Hubs have a strong eventually consistent architecture because even if they go offline, their state can be reconstructed using their peers.
Peer nodes are critical to maintaining the state of the protocol, so they evaluate each other. If a node does not receive valid information, falls behind, or gossips too much, it may be ignored.
No permission required
From these protocols and principles, we see new primitives emerge. Among them, Farcaster's Frame has received considerable attention.
Frame makes it possible to inject custom experiences into the Farcaster feed. It extends the Open Graph standard and turns a static image into an interactive experience by adding up to 4 buttons. When a user presses a button, they get a new image based on the button click and the user metadata sent to the Frame generation server.
Building on this, we’re starting to see a lot of experiments like creating pools, digital collectibles, and mini-games deployed through these Frames.
It is possible to create frames using any application server that can return html content, but we have seen a lot of frames such as https://framesjs.org/, https://frog.fm/ and others that help developers simplify the process.
After the successful launch of Frames on Farcaster, Lens is now also under consideration, which shows that having common standards can be a powerful driving force.
in conclusion
Decentralized social networks still face some major challenges before they can fully succeed, such as scaling their infrastructure to accommodate more users, simplifying the process of creating digital wallets for new users, and minimizing gas fees.
Despite these challenges, Farcaster has made substantial progress in terms of user experience and has formed a highly sticky community around the platform. For example, Farcaster has approximately 50,000 daily active users and approximately 350,000 registered users. An important factor contributing to these achievements is the ease of use of its mobile app, which makes the app easy to install and the user experience similar to that of traditional social networks.
Another key factor is the permissionless nature of protocols like Farcaster and Lens, which provides developers with rich possibilities to innovate and build on top of existing blockchains and functionality.
We are witnessing a dynamic experimental environment similar to the DeFi Summer, with yup.io (a decentralized social network aggregator), drakula.app (a short video platform), and neynar.com (a SaaS tool based on Farcaster) all based on explorations of emerging protocols.
Now, founders can start building a native Web3 distribution channel for their projects, allowing users to start their journey from their initial point of interest and potentially expand to other applications embedded directly in their feeds or other linked applications. At the same time, applications that attract new users can serve as distribution channels that lead users back to the rest of the decentralized social network, forming a positive feedback loop.
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