Decentralized Social Media: The Next Big Thing in the Crypto Space?

Author: Mitch Eiven, Cointelegraph Magazine

Compiled by: Unitimes

NFTs and the Metaverse are currently the hottest topics in the Crypto ecosystem, but the next big thing may just be decentralized social media. Like DeFi (decentralized finance), decentralized social media platforms do not have a centralized governing body, and perhaps one day, they will provide viable alternatives to existing platforms like Twitter, Instagram, Facebook, and TikTok. This technology is currently in its nascent stage of development.

Yung Beef (hereinafter referred to as YB) is the content head and community manager of the decentralized social network platform Subsocial. He believes that traditional centralized social media platforms are unfair to community members and content creators. He stated:

"It’s clear that centralized social networks are easily influenced by many dark things, with mysterious algorithms controlling what people see, and individuals can be blocked or completely banned for any reason, and so on. Moreover, when considering that many people rely on these platforms for their livelihoods, and their bills are entirely determined by centralized entities, the situation becomes even worse."

The Subsocial platform claims that the centralized social media industry is plagued by global censorship, lack of customization, unfair profit mechanisms, algorithmic dictatorship, and monopolization of network effects.

Stani Kulechov, CEO of the DeFi lending market Aave and also a developer of decentralized social media, believes that content creators should have a permissionless, uncensored channel for content distribution with their audiences. He stated, "At least those who publish, create, consume, and share content will definitely benefit from decentralized social media."

Last summer, when Stani Kulechov hinted that DeFi giant Aave was considering building a "Twitter on Ethereum," he made headlines both within and outside the Crypto community.

Above: In July 2021, Stani Kulechov tweeted that "Aave should build a Twitter on Ethereum."

Michael Marra, founder and CEO of the social media application Entre running on the DeSo blockchain, believes that decentralized social media is essentially about "giving power back to the people." According to him, one issue with centralized platforms for creators and users is censorship, and another issue is monetization. We will elaborate on this further below.

How does it work?

Both centralized and decentralized social media platforms utilize some form of social graph (a model depicting everyone on the platform and their relationships) and allow users to interact on the front-end platform. Traditional centralized social media platforms are completely independent, with data servers controlled by specific companies. This is also true for Instagram, Facebook, TikTok, etc. In contrast, decentralized social media platforms operate on public blockchains, and to a large extent, anyone, anywhere can run nodes, access backends, create applications, and manage feed streams.

According to its website, "DeSo is a brand new L1 (Layer 1) blockchain designed to scale decentralized social applications to a billion users." The blockchain is open-source, with code and all data stored directly on-chain. Currently, over 200 applications are deployed on the DeSo chain, and users who create profiles in any application can easily bring their profiles and their followers' communities to any other application on that blockchain.

Entre is short for "entrepreneur," and it is a Web3 social application running on the DeSo chain. On Entre, freelancers, employees of traditional companies, or any other professionals can post Twitter-like content and conduct business transactions. They can hold meetings, host virtual events, and hire employees; the app functions as a decentralized, digital, and profitable alternative to LinkedIn, Zoom, and Google Calendar—all concentrated in one product.

Entre operates on a social blockchain, while the Lens Protocol supported by Aave is deployed on Polygon. Stani Kulechov stated, "Lens is essentially a decentralized social graph."

According to Kulechov, when users of applications on the protocol create profiles, those profiles are tokenized as NFTs. Whenever someone follows a user, they create a relationship on-chain that cannot be broken by the platform or anyone else, because these relationships are also tokenized as NFTs, which can be viewed in digital wallets like MetaMask or on OpenSea's web.

Subsocial does not see itself as a decentralized social network but rather as a platform for building social networks. It allows users to create profiles and customize their own "spaces," claiming to have a serverless public timeline, roles and permissions, user governance, moderation, DAO spaces, and a treasury. The platform runs on the Polkadot and Kusama blockchains and has recently created its first application, which is a decentralized mix of Reddit & Medium.

According to YB, Subsocial plans to remove these profiles in the future. To save space, all content (images, videos, and text) uploaded to Subsocial is hosted on the IPFS system, and the IPFS content identifiers are uploaded to the blockchain. Each IPFS node is hosted by one or more individuals, and these node operators control the content hosted on their servers.

As developers of Lens Protocol, Entre, and Subsocial build the next generation of decentralized, Web3 social platforms and applications, other platforms like Theta and Audius are integrating social media tools into decentralized video and audio streaming services. Theta is a peer-to-peer network running on its own blockchain, where users can share bandwidth to relay videos to each other. On its website, YouTube co-founder Steve Chen stated that the Theta project can "improve video delivery at a lower cost." Just like on YouTube, brands and creators can publish streaming content through Theta, and their followers can post comments in real-time.

Meanwhile, Audius is a decentralized audio streaming platform running on the Solana blockchain that aims to provide everyone with the freedom to distribute, monetize, and stream any audio content. Artists can easily upload music snippets to the platform, and fans can listen to original works and remixes, manage their libraries, and repost, follow, like, and share content. The platform offers as much fun as traditional centralized audio streaming platforms but without intermediaries pushing trivial ads and taking large cuts from content creators.

How to deal with "bad actors"?

If creators want to monitor their content on a fully decentralized platform like Subsocial, then how can illegal content and misinformation be controlled? For years, social media moderation has been a contentious topic, with platforms like Facebook and Twitter failing to filter dangerous content and uphold their commitment to open dialogue.

YB explained that Subsocial is anti-censorship; while Kulechov stated that Lens Protocol "is built entirely on agnosticism in terms of moderation, and it is essentially meant for building social media applications."

Meanwhile, Entre's CEO Michael Marra said:

"If it’s open, that means anything can happen. But you can control it to some extent."

Marra believes that blockchains can be built to promote community reporting of issues. Community members, especially those with higher authority (like those with many followers or good reputations), can point out when a bad actor is posting suspicious content. Violators' content should be pushed down in the feed. Marra believes that blockchain verification can also prevent many "such things," like "you will immediately know this person is not a good actor."

According to Kulechov, moderation creates choices for everyone. Lens Protocol has a shared social graph where all user information is actively connected, and unlike traditional social media, this social graph is decentralized. Kulechov believes that decentralizing the social graph, allowing everyone to access it, provides an opportunity for more humane moderation.

This accessible interconnectivity offers developers the chance to create algorithms focused on content moderation. This essentially places the front end of the protocol (i.e., applications) in a competitive position to provide access to accurate, appropriate information. Kulechov stated:

"Perhaps the right way to moderate content should be community-led, where community site personnel disclose their identities and moderate or choose algorithms."

Subsocial has three levels of moderation: first, every post is created within a certain Space. YB stated, "You can think of Spaces as subreddits on Reddit, groups on Facebook, profiles on Twitter, or a blog. Each Space has at least one owner who can moderate its content. Additionally, each IPFS node is hosted by at least one community member. These node operators can control the content hosted on their servers. Finally, anyone can create front-end social applications on the platform. Front-end applications connected to the Subsocial blockchain can read all content on the chain. Node operators can control the content distributed on that front end.

However, YB stated that if a front-end operator and a group of bad actors decide to spread misinformation or illegal content, Subsocial can shut them down through on-chain voting. "This would be a big deal and could cause a lot of trouble, but it would also be meaningless because those people could immediately create another Space and continue." YB argued that people have always used the internet to coordinate violence and share illegal content—these contents are just hidden now, and it remains so because large social networks built on Subsocial will not display this content.

However, it is worth noting that centralized social media platforms have the ability to shut down a creator or community with the click of a button, and for years, these platforms have been working to curb the spread of illegal content and misinformation. Therefore, while relying on community self-moderation is egalitarian and sounds good in theory, it may not be effective in practice. Self-moderation on an anti-censorship platform may require community members who can fully participate. In a Web3 environment, this may not always be the case, as a sufficient number of active community members are needed to monitor bad actors on any given decentralized network. For example, a recent analysis ranking community engagement in DAOs showed mixed results.

When a super-large community goes off the rails, how will an anti-censorship platform respond? Considering that an organized, well-funded army of bots could generate a large amount of misinformation, can a widely adopted decentralized network moderate a community made up of many such propagandists?

Monetization

Fair profit for community members and content creators is one of the key features of the decentralized social media ecosystem. Compared to the imbalanced profit models in traditional social media, decentralized social profit models could change the game for content creators and attract more users to adopt the game.

YB stated, "Personally, I believe that profit is more appealing to content creators than anti-censorship. For example, YouTube takes 45% of advertising revenue (creators get the remaining 55% of ad revenue), which is quite crazy." He further added, "I am very interested in what results (tipping creators) will bring. I hope we can see the emergence of a micro-tipping economy because it’s so easy. See a joke that makes you smile in the morning? Why not tip them (the creator) $0.50 right away?"

Lens Protocol takes a hands-off approach to monetization. Kulechov stated, "We want to touch monetization as little as possible and give developers more space to solve this issue." Lens is currently building a very basic monetization feature around content curation and expansion. When creators publish music, text, audio, or video, followers (fans) can collect this content as NFTs. The platform has different collection modules, and followers can mint these NFTs themselves. If these followers subsequently expand the audience for the content, the creators will earn fee income, similar to monetizing through retweets on Twitter.

On the DeSo blockchain, DESO tokens can be used to purchase creator coins. BitClout, Diamond, and CloutFeed are Twitter-like applications that allow followers supporting a specific creator to invest in that creator's coin, potentially multiplying its value. Although not recommended, these coins can be converted back to DESO and actively traded or cashed out for fiat currency. According to Marra, Entre is not "interested in creator coins" but is more focused on allowing creators to earn DESO through tips during live streams.

Entre users can also sell tickets for live or virtual events and charge for private one-on-one services like consulting and coaching. The app offers community features similar to Slack and Discord, allowing for membership fees, where users can provide services like graphic design. Currently, DESO is the only cryptocurrency accepted on the application, but Marra plans to offer multiple tokens in the future.

Theta has been involved in the monetization game for some time and provides crypto rewards for creators, fans, and node hosts. The platform has two tokens: THETA and TFUEL. Owners of THETA (its native token) can participate in governance and earn more THETA by staking or running nodes. TFUEL essentially serves as the platform's utility token, and community members can earn it by watching streams on Theta.tv or hosting Guardian and Edge Nodes. They can use TFUEL in the TFUEL store to purchase real-world goods or subscribe to paid content.

Meanwhile, Audius uses its AUDIO token to help artists monetize their works and assist fans in supporting their favorite artists. Community members can earn AUDIO by uploading, inviting, linking social media accounts, and continuously listening. Fans can send AUDIO directly to artists.

Clearly, decentralized social media has the potential to tilt the scales of fairness and privacy toward users and content creators. It could reshape the social media industry and redefine digital freedom of speech in the Web3 era. But to achieve this, it may still need to find an appropriate content moderation solution, and it will require widespread adoption. However, thought leaders in this field are looking to the future, as Kulechov stated:

"Adoption will definitely be a long game. It may take years to achieve adoption."