Debate Among Experts After 8 Years of Competition Nearly 500 Projects Finally Produce a Unicorn Is Web3 Social Summer on the Horizon

The founder of Farcaster, in the first two years of becoming a unicorn, took the most primitive approach to promote his social application: personally persuading Web3 people in his circle of friends, including V, who promoted Farcaster.
After thousands of ground promotions, Farcaster gathered a group of elite seed users.
Web3 users, led by early Twitter investor Fred Wilson, announced their migration to Farcaster, with most of Vitalik’s views being first released on Farcaster.
On May 21, Farcaster announced the completion of a $150 million financing at a valuation of $1 billion.
Since the launch of the decentralized content platform Steemit in 2016, Web3 social has experienced eight years of ups and downs.
Compared to the rise and fall of DeFi and GameFi, Web3 social is a more lonely story. Most first-generation gold diggers such as Steemit and Bihu have ceased operations, and platforms like Lens, Damus, and friend.tech quickly fell silent after creating a brief spark.
Farcaster seems to bring a glimmer of hope to Web3 social.
A user on the X platform tweeted, “I can no longer see many innovative articles on Twitter.” Vitalik replied, “Join the decentralized social protocol Farcaster, where there are many Cambrian explosions and strange events.”
0xLuo, who has nearly 50,000 followers on the platform, told ChainCatcher, “For the first time, I feel real social interaction on a Web3 social platform, not just self-entertainment.”
At the same time, the high ceiling brought by the social network effect continues to “tempt” new and old players, with nearly 450 Web3 social projects in operation according to RootData statistics.
In 2018, inspired by Steemit, the development of an encrypted incentive social product Torum experienced setbacks but is now making a comeback. The founder of Torum, Jayson, told ChainCatcher, “We are about to launch Torum SocialFi V2.”
UXLINK, a company with social entrepreneurship experience in Web2, and Tony, a senior entertainment investor in Web2, have both chosen social as their first stop in Web3 entrepreneurship. They both believe, “Social is the necessary path for large-scale applications in Web3.”
Although Web3 social has not fully matured, AC Capital investment manager Armonio stated in a recent article, “As Web3 technology continues to advance and the barriers and costs continue to decrease, the emergence of truly innovative products may be happening right now.”
The most primitive method: phone-based ground promotion
Tony, co-founder of the Web3 social platform Tako, began planning to call 300-500 well-known founders, investors, or KOLs in the Chinese-speaking community to invite them to join their Web3 social client TakoCast.
Tony plans to create an Asia-Pacific version of Farcaster. “For Farcaster, it needs localized operations for different language regions.”
Phone-based ground promotion is something he learned from Dan Romero, the founder of Farcaster. “The effect of one-on-one phone calls is completely different.”
Before founding Farcaster, the co-founders Dan Romero and Varun Srinivasan both held important positions at Coinbase. Early investors in Farcaster included a16z, Coinbase Ventures, and Multicoin, top VCs.
The first 2,000 users of Farcaster were mostly friends of Dan Romero and Varun Srinivasan, who were influential figures in the Web3 community.
“These elite seed users have created real social interaction on Farcaster,” where they share their views on technology, entrepreneurship, investment, and even life.
According to Tony, “Farcaster has not only built an elite community of big shots but also a resource base for unlimited imagination for future ecosystem construction.”
Compared to the debates about decentralization and the adoption of innovative technologies, the migration and endorsement by influential figures are more appealing.
In mid-2022, after Farcaster announced a $30 million financing with a16z as the lead investor, 0xLuo did not participate in the project interaction, “because I found the invitation code to be troublesome, so I put it off.”
It wasn’t until October 2022, when Vitalik tweeted on the X platform and attached his personal Farcaster and other Web3 social account addresses, that 0xLuo began to take Farcaster seriously.
“Vitalik’s endorsement means I must participate,” 0xLuo privately messaged Dan Romero to request an invitation code.
Six months later, 0xLuo finally obtained an invitation code to enter Farcaster.
Initially, 0xLuo did not find Farcaster’s features and technologies particularly special, “but it brought me closer to the influential figures.” On the X platform, you can only like the influential figures, but on Farcaster, you can interact with them, and the likelihood of getting a reply is very high. “Even without token incentives, living in the circle of influential figures is very attractive.”
In addition, due to the high quality of users, alpha opportunities closely related to Farcaster are also given priority on Farcaster, which is another major attraction for 0xLuo.
After transitioning his Web3 social main base to Farcaster, Farcaster brought him the most fans among the various Web3 social projects he participated in.
0xLuo told ChainCatcher that at the beginning of this year, his Farcaster fans were less than 2,000. “With Farcaster’s daily active users surpassing 50,000 in February, my fans have also skyrocketed in the last 4 months, far exceeding the number of users following me on the X platform.”
Crypto KOL A Ping also entered Farcaster in October 2022. A Ping shared on the podcast about the difference she noticed with Farcaster, where most members of the Nouns DAO, a community she had been following, joined Farcaster without any proposal.
“Nouns DAO has always been looking for a social platform to discuss public affairs and has chosen Discord through a proposal, but the Discord channel of Nouns DAO has been abandoned even after a shutdown and reopening.”
No longer obsessed with the concept of decentralization
Early Web3 social projects were based on decentralized narratives, especially reaching a peak after Reddit was banned in 2021.
In early 2021, a group on Reddit called “Wall Street Bets” led retail investors to force a short squeeze, causing at least two hedge funds shorting GameStop to go bankrupt.
However, after a brief frenzy, American retail investors stopped, stock trading codes were deleted, and Reddit was also blocked.
Joshua Meng, the founder of the open information layer RSS3, recalled that at the time, there was a strong demand for decentralized social or anti-censorship in the market, “because everyone thought that decentralized finance must also require decentralized social.”
Today’s Web3 social projects, represented by Farcaster, initially used a more centralized and operation-oriented approach, and the technical stack also emphasized the “adequacy” of decentralization. Joshua Meng feels that “more Web3 social entrepreneurs are moving from idealism to realism.”
Dan Romero and Varun Srinivasan, the two founders of Farcaster, mentioned this shift in thinking in a recent interview.
Dan Romero mentioned that after entering the market in 2021, they found that people in the cryptocurrency field talked a lot about decentralization and the need for other applications in the ecosystem. “We also naively thought that people would want to play with new things, but the fact is that users prefer to continue using existing products.”
Early this year, Frames, a feature similar to embedded mini-programs, brought explosive growth to Farcaster. It allows developers to embed interactive experiences in Farcaster posts (casts), such as voting, minting NFTs, building games, and even conducting real-time transactions directly in social media feeds, eliminating the need to switch between content browsing and on-chain interactions on traditional social platforms.
Since its launch on January 26, Farcaster has grown its daily active users by 20 times in less than 10 days.
0xLuo believes that the appearance of Frames is what truly sets Farcaster apart from the X platform and has set a good example for native crypto innovation in its ecosystem.
The strong resource operation model of Farcaster is not something that any Web3 project team can replicate. However, a group of Web3 social project teams, like Farcaster, are trying to explore the real needs of the Web3 field starting from specific tools.
“Without solving a real pain point for Web3 users, no project is sustainable,” said Torum founder Jayson, who is one of the earliest Web3 social gold diggers, and this is the lesson he learned after stepping into pitfalls.Social interaction is more important than token incentives
In 2016, a social media platform similar to a blog forum called Steemit was launched. On Steemit, users can earn a system reward token called Steem based on their posts (articles, images, comments), as well as user votes and comments. Steemit also emphasizes returning content ownership to users by putting content on the chain.
Within a year, Steemit gained over 168,000 registered accounts. Inspired by Steemit, Jayson started developing a similar crypto-incentivized social platform called Torum in 2018. The V1 version of Torum allows users to earn XTM tokens by posting, inviting friends, and reposting content.
However, this incentive method did not produce the expected results. With the bear market approaching, Torum V1 was unable to provide sufficient rewards, leading to the rapid loss of users who had joined with the expectation of earning money.
Torum V1 later attempted to lower the platform’s barriers to entry and aggregate multiple media platforms to enrich platform content, but user numbers still did not increase significantly.
Jayson stated that relying solely on token incentives to attract users will ultimately backfire. “From 2016 to now, all Web3 social projects that have tried to attract users using only token incentives have failed.”
Incentives on Fi, such as the reward system on Farcaster through memes like Degen, may offer a more superior token incentive platform project technique.
“Social will account for 80% of Torum V2, and Fi will only account for 20%,” Jayson hopes that Torum V2, like Farcaster, will establish a higher-quality social network. Jayson chose to start with NFT players and address the pain point of NFTs having almost no use cases.
In the past, NFTs could only be used for personal avatars, but Torum V2 aims to transform NFTs into usable masks and filters. Similar to the special effects filters on short video platforms, these filters allow users to imitate and propagate trends.
Jayson analyzed that the explosion of Web2 social platforms like Facebook originated from a unique and innovative content creation tool, and Web3 social platforms will follow a similar logic.
Compared to using a small number of high-quality Web3 users to achieve scale expansion, UXLINK is more practical and chooses to find opportunities in larger traffic pools.
UXLINK mentioned that users’ current demand for Web3 is simply to discuss Web3 projects and discover investment opportunities.
“Similar to WeChat, Facebook, and other familiar social platforms, it is easier to establish trust and conduct transactions.”
The core team at UXLINK appreciates the friend-assistance gameplay of Pinduoduo and TEMU, which has been successful worldwide. Therefore, UXLINK replicates this similar model in Web3 social platforms and chooses Telegram, which has a large traffic volume and lower risk control, as the platform.
UXLINK uses the Link To Earn incentive mechanism to invite friends into Telegram groups for C-end users, providing them with a social space for project discussions and participation.
With a large amount of C-end traffic, UXLINK monetizes B-end Web3 developers who need traffic. UXLINK has reported over 10 million registered users, and its revenue and expenditure are balanced.
“Web3 social platforms have always been a major area of investment,” said Bill, an investor at UXLINK’s investment firm, Cypher Capital, who takes a more practical approach to investing in Web3 social platforms.
In a situation where the Web3 user base is relatively low, compared to closed applications that require self-built traffic, he prefers social projects that can find traffic pools from the beginning.
In Bill’s view, “Without a user base, you can only make a short-term profit from tokens based on storytelling and market sentiment.”
The timing is better
The inadequate infrastructure of Web3 is also a major reason for the setbacks of early prospectors.
TikTok was launched on September 20, 2016, two months after Steemit. Compared to TikTok’s user-friendly gameplay, accessing Steemit requires several steps.
In the early days of Steemit, Jayson mentioned that encrypted wallets like MetaMask were not yet popular. The official Steemit wallet would generate four types of keys when users created an account, each symbolizing a different permission, such as logging in or posting content. “As a novice, it was very confusing.”
Before founding Cyber (formerly CyberConnect), Ryan and his founding team also started a decentralized live streaming platform called Dlive in 2018. At that time, there were not many developers on Ethereum, so in addition to developing the product, Dlive also needed to develop its own chain and handle deposits and withdrawals.
Dlive reached 1 million daily active users at its peak and had the largest YouTuber, PewDiePie, exclusively streaming on the platform. Ryan mentioned that timing is also crucial, “We were early, and if we started today, Dlive might have been even more successful.”
Tony, co-founder of Tako, believes that the time has come for large-scale adoption of Web3 social applications.
On one hand, the entire Web3 infrastructure is growing, leading to a better user experience. For example, wallet logins have moved from mnemonic phrases to MPC and abstract accounts, reducing the barrier to app usage.
As public chain transaction speeds increase, gas fees are also decreasing. Tony said, “DeFi might yield hundreds of dollars in profits, so paying $10 for a transaction is still acceptable. Social content is very high-frequency, so if every comment or repost costs $10 in gas, no one will use it.”
After public chain networks are scaled, they can handle more concurrent users and support multimedia content, rather than just text.
On the other hand, while Web3 social applications have not yet achieved mass adoption, a group of entrepreneurs is beginning to build Web3 social infrastructure. This infrastructure “puzzle” lays the groundwork for the birth of popular social applications.
Ryan mentioned that now, when a developer creates an app similar to Dlive, they only need to focus on the product itself. They can choose social-specific chains like Cyber and call upon the social graph built on Cyber. Cyber will soon also integrate with DEX to help apps solve user deposit and withdrawal issues.
Currently, there are more Web3 social protocols than applications, and major protocol ecosystems maintain strong openness.
Earlier this year, 0xLuo noticed the emergence of some interesting clients on Farcaster, such as the Web3 version of TikTok Drakula and the Web3 version of Instagram Jam, as well as some aggregation clients that support not only Farcaster but also Lens and other protocols.
“Major protocols serve as infrastructure and guide each other,” and the Lens ecosystem application Phaver chose to hold events on Farcaster and already supports cross-platform posting on Lens and Farcaster.
Firefly, under Mask Network, supports cross-platform synchronization between Farcaster, Lens, and X, as well as aggregating content from the Mirror and Paragraph blogging platforms.
Is the singularity of Web3 social here?
Uniswap drove DeFi Summer, and Axie defined GameFi 1.0. With Farcaster becoming a unicorn, is the singularity of Web3 social here?
0xLuo believes that Farcaster, combined with composable Lego applications and meme coin economics represented by $DEGEN, has ushered in an on-chain Social Summer.
Joshua Meng, the founder of RSS3, remains cautious. While Farcaster’s current development momentum is strong, it has not yet broken through as a Single Tribe Network. The current prosperity is closely related to early high-quality seed users.
Farcaster’s model is almost identical to the once-popular Clubhouse. As the user base becomes more open, the social quality on Clubhouse rapidly declines, and the early elite seed users will leave.
Joshua Meng believes that in the past year or two, Web3 social projects like Farcaster, Lens, Nostr, and friend.tech have attracted users through Web3-native ideology and economic incentives, which fundamentally differs from traditional social businesses that rely solely on product and experience innovation.
Jayson shares a similar view, stating, “Web3 social is still a very vague concept. Currently, there is no project that has appeared to define Web3 social in stages.”
Joshua Meng predicts that it will take a longer time for the final stage of Web3 social to arrive. It is not just a matter of Web3 entrepreneurs innovating through pain point solutions, but rather a social change.
“Like electric cars compared to gasoline cars,” early users were not sensitive to using electricity instead of gasoline. However, with the better user experience offered by startups like Tesla, combined with educational efforts, government incentives, and other factors, the automotive industry entered the era of new energy.
Currently, Web3 social startup projects and teams need to gradually achieve mass adoption of decentralized social media through different paths and prepare for the arrival of the final stage.
Although the singularity may not have arrived yet, Armonio, an investment manager at AC Capital, believes that “everything is progressing, and the industry’s accumulated experience, lessons, and continuous technological progress are bringing us closer to the industry’s explosive singularity.”