Farcaster is a decentralized social networking protocol that enables social connections, content sharing, and data ownership among users through smart contracts and hybrid storage technology. It supports diverse and flexible client and application development.
In March of this year, the memecoin project Degen, part of the Farcaster ecosystem, gained widespread attention with a more than 20-fold increase in value and a market capitalization of over $1 billion, making the Farcaster ecosystem the center of attention.
In May, the developer of Farcaster, Merkle Manufactory, announced the completion of a new round of financing led by Paradigm, totaling $150 million and raising the company’s valuation to $1 billion.
According to Dune data, the total number of Farcaster users has reached 540,000, with daily active users increasing from 2,000 at the beginning of the year to 56,000, achieving more than a 28-fold growth.
Farcaster is not a new social project. In the early testing phase, founder Dan invited many well-known OGs, including V God, to join through his personal influence and connections. He also used Twitter direct messages to obtain invitation codes, which resulted in a highly concentrated group of “elite” users in the Farcaster community.
This approach of setting a high entry barrier aims to gather a highly similar user base in the early stages, making Farcaster a more refined version of Twitter to some extent. Early users can enjoy higher-quality posting and interaction experiences.
In addition, users with early qualifications are usually influential KOLs themselves, who have a high social influence and may feel socially superior by experiencing Farcaster early. They also have a stronger motivation to discuss and spread Farcaster on other platforms.
In October last year, Farcaster opened registration but still set a $5 entry fee, effectively preventing a large number of robot accounts from registering and maintaining a good atmosphere for the overall Farcaster community. This is in stark contrast to Nostr, which declined due to the proliferation of robots. To date, Farcaster has accumulated nearly $1.9 million in revenue from registration fees and data storage fees.
Both founders of Farcaster, Dan and Varun, have held important positions at Coinbase, which makes Farcaster closely linked to the Base ecosystem. Jesse, the core person in charge of Base Chain, is also very active on Farcaster.
From another perspective, more than 70% of the interactions among the top 500 users with the most followers on Farcaster occur on the Base Chain.
Therefore, for those who are optimistic about the Base ecosystem, Farcaster is also seen as a potential treasure trove of alpha.
The data of the Farcaster protocol is stored in on-chain and off-chain hubs. Developers can choose to run hub nodes themselves or use third-party service providers like Neynar to obtain data.
All this data is permissionless. Based on this available data, developers can build various clients and applications, greatly increasing the richness and innovation space of the Farcaster ecosystem.
Users can track the progress of the ecosystem through the decaster website. Here are some highlights of the projects:
WrapCast:
Warpcast is the main application under the Farcaster protocol and the first Farcaster client. It was developed by a top engineering team led by Dan for more than a year.
Its overall architecture is similar to traditional Web2 social software, with a smooth user experience, and currently accounts for 90% of the Farcaster protocol’s traffic.
The registration process for Warpcast is simple, and the system automatically generates a wallet for users. All Warpcast accounts are associated with a Farcaster ID, and the generated content is stored in the Farcaster hub.
This design allows even non-cryptocurrency users to easily enter the on-chain world, greatly reducing the cognitive threshold for new users.
For users familiar with on-chain interaction, they can also bind their commonly used cryptocurrency wallets. These adjustments not only provide user-friendly experiences but also contribute to the growth and acceptance of the Farcaster ecosystem.
Warpcast is designed as a social platform similar to Twitter, where users can post tweets (casts), comment, retweet, and follow other users.
In addition to the social media functions similar to Twitter, Warpcast also introduces features such as channels and actions, which generate more interactive ways.
For example, DEGEN uses the participation of users in the Farcaster ecosystem to distribute tokens. Users can participate in DEGEN airdrops by following channels and interacting, and the airdropped tokens can be given as rewards to other users.
Farcaster’s significant growth this year is closely related to the Frames feature launched in February. Frames are mini-applications embedded in Warpcast, allowing users to engage in more diversified interactions without leaving the Warpcast client, such as minting NFTs, content subscriptions, playing games, and receiving tokens.
For example, far.cards is a collectible card project exclusive to Farcaster users, developed based on mint.club. The attributes of each user’s card are determined by their activity level on Farcaster, such as the number of followers, likes, and replies.
The price of the cards is determined by the bonding curve, and the purchased cards can be collected or traded.
As shown in the figure below, the far.cards application can be published in the form of a Frame in a tweet, and users who see the tweet can directly purchase the card through the Frame without leaving the Warpcast client.
The launch of Frames greatly enriches the playability of Warpcast and allows Farcaster development to go beyond just building a decentralized Twitter.
Currently, nearly 40,000 users are using the Frames feature, generating over 150,000 on-chain transactions, and the number of interactive contracts designed has reached 1,624.
Jam:
Jam is a creator economy platform based on Farcaster that converts every tweet on Warpcast into an NFT asset similar to Friend.tech Key. Users can buy and sell each tweet, and the price is determined by the bonding curve shown in the figure.
Within 72 hours of its launch, Jam’s trading volume exceeded $10 million.
Using Jam for the first time requires consuming 10 warp points, which are given as a gift of 100 when registering for Farcaster.
After binding the Farcaster account, users can see the tweet stream on the homepage and find tweets worth minting. The Top list includes tweets with the most recent trades and the latest tweets, and the Trades section shows real-time records of tweet transactions.
Unlike Friend.tech, each tweet can only have one owner at a time, so there is no situation where many people buy and sell at the opening. However, the profit strategy is similar, requiring early identification and purchase of tweets with potential for dissemination, including Farcaster core developers, V God, KOLs, etc., to ensure that there will be other buyers in the future.
If you are a KOL or someone who is good at tweeting and meme creation, you can also earn a 5% transaction fee by continuously writing tweets and promoting their dissemination.
Jam currently does not have a token but has internal points. Considering the overall gameplay and similarity to Friend.tech, there is a potential for significant airdrops on Jam.
Clubcast:
ClubCast is an application on Farcaster similar to Zhi Shi Xing Qiu (Knowledge Star) and has implemented token-gated casts, which require users to pay to purchase club tokens from other users to unlock hidden content on clubcast.xyz or in the Frame. Currently, it requires permission from the developer to use.
BountyCaster:
BountyCaster is a task platform built on the Farcaster protocol and was founded by Linda Xie (former co-founder of Scalar Capital and Coinbase product manager).
As shown in the figure, users can add the tag @Bountybot when sending content on Warpcast and other clients to post tasks, and other users can claim the corresponding tasks and receive rewards.
Similarly, users can also post services and prices they can provide. Users need to log in with their Farcaster account to view published bounties, available services, and even job opportunities on the BountyCaster website.
AlfaFrens:
AlfaFrens is a creator economy application built on the Base ecosystem and Farcaster protocol, developed by Superfluid, which supports the flow of on-chain assets.
Similar to Friend.tech, users can subscribe to KOL channels and access exclusive chat rooms. Furthermore, they can also obtain tokens produced by the channels.
There are two currencies on the platform, $Degen and $ALFA. $Degen is an ERC20 token on the Base chain, while $ALFA is the proprietary token of the AlfaFrens platform, which can only be obtained within the platform and is not transferable.
$Degen is the consumable token of the platform. When starting to use AlfaFrens, users need to prepare some $Degen and deposit them into the wallet generated by the platform.
Users can use $Degen to subscribe to KOL channels, which are divided into three levels: 500, 1000, and 1500 $Degen per month.
The subscription fee is linearly consumed, and users can cancel their subscription at any time. 70% of the subscription fee is distributed to users who stake $ALFA in the channel according to the staking ratio.
Every day, the platform produces $ALFA tokens, and each channel distributes the allocated $ALFA evenly among subscribed users based on the amount of $Degen received from subscriptions.
Therefore, users can subscribe to channels with high popularity, stake the received $ALFA tokens in the channels, and earn more $Degen.
$ALFA is currently not a circulating token and has no pricing. In the early stage, it can be obtained by exchanging $Degen. Therefore, different participation strategies can be formulated based on profit preferences (whether to obtain more $Degen with existing value or more $ALFA without pricing).
In summary, as people become more accustomed to “living” on the Internet, social graphs have become important personal assets, and the demand for data ownership has increased.
Web3 solutions naturally adapt to address the pain points of current Web2 social platforms, but decentralized social networking has not been particularly successful in this field.
Many projects focus too much on decentralization and overlook the importance of user experience. Dan pointed out in an interview with Bankless that the positioning of Web3 social networking is not to replace Web2 social networking but to improve it, allowing users to have data ownership and join more on-chain gameplay, achieving things that Web2 cannot.
Farcaster significantly improves user interaction smoothness by storing value data on-chain and high-frequency data off-chain.
The team has always attached importance to mobile development from the beginning, as they know that mobile devices are the primary usage scenario for social software.
Therefore, the Warpcast client has a good user experience, full functionality, fast iteration, and continuously introduces new features such as long posts and interactive features (actions), providing developers with more and more capabilities to build new applications.
Although Farcaster is far from perfect and still has many areas for improvement, it is already an application that can attract users and maintain growth. There will definitely be more excellent products based on Farcaster in the future. Let us look forward to and pay attention to the development of Farcaster and participate in it as early as possible.
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