Analysts in Web 3 have been predicting the rise of decentralized social networks, which could solve many problems associated with conventional social media platforms. These problems include hate speech, bans, bots, and other issues that make users feel unwelcome.
Decentralized social networks solve these problems by allowing users to control their data and content. With a decentralized architecture, users can be assured that their data is not stored in a single location that can be hacked or accessed without their consent.
This statement also means that users can interact with each other directly without intermediaries, which can increase the sense of community and reduce the influence of centralized platforms.
Decentralized Social Networks
These networks differ from traditional ones in that they are on the blockchain. Other differences include their decentralized asset ownership and the fact that they are trustless, not requiring any approval other than blockchain. This aspect makes them a step towards the future, with traditional networks losing more trust every day over data usage.
How Do They Work?
There is more to these networks than meets the eye. These networks work on a four-layer data structure which includes a data layer, a social primitive layer, an algorithmic layer, and a user layer. The data layer comprises smart contracts and content management systems (CMS). It is essentially the back end of the network.
Finally, the primitive social layer defines the relationships between data. One example is the Les Protocol, a popular Web 3 social platform where social graph follower data and created content are stored as NFTs. Developers can use these NFTs on other protocols to build something on top of these apps.
The algorithmic layer deals with moderation and policies governing the network. Social networks are governed by a democratized system that values transparency. The fact that they are community-run also adds to their appeal. The user layer is where users interact with the app and can differ depending on the type of Decentralized Social Network (DeSOC) in development. The question now remains, how can you monetize these social networks?
Monetizing DeSOCS
On this front, there need to be more monetization models that traditional social networks use, such as advertising and subscriptions. Unfortunately, these models do not find any use in a decentralized world. For example, advertising requires mining users’ data, so Web 3 was built first. Therefore, this is frowned upon in the Web 3 space.
Some models in development incorporate other models to make content subscription through staking possible. These terms may initially sound fancy, but it is a dilutive subscription model. In this model, users acquire a diluted token, and a part of the proceeds goes into the platform. They use this instead of clear revenue sharing on the platform.
Tax Memberships
Another model in development is where users can voluntarily pay to follow a creator. The contribution is like a donation, but the fee is set in a range, and the creator will get a part of the fee. The catch is that other users can outbid you on the platform anytime by offering a higher amount, taking your spot there.
The perks of DeSOCs are good on paper and provide many advantages geared toward user protection. They are open source, with no single point of failure, and can be audited or improved by anyone. In the best-case scenario, this allows them to align with user interests.”
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