Can Farcaster Revolutionize Web3 Social?

Since the advent of cryptocurrencies, we’ve never been closer to the moment of mass adoption. Web3 social platforms like Farcaster, which integrate both cryptocurrency and advanced technology, are moving beyond mere speculation and hype.

If you’re a fan of Vitalik, you’re likely aware of his passion for ENS (Ethereum Name Service), which he considers the most successful non-financial blockchain application to date. Now, Farcaster has become Vitalik Buterin’s most frequently used Web3 social application. So what makes Vitalik love it so much?

Transforming Web3 Social with Farcaster

Before Farcaster, many Web3 social applications, like DeBox or Friend.Tech, were heavily financialized, primarily focusing on financial scenarios with social elements added on. This highlights a significant challenge for Web3 social applications: an overwhelming financial focus that often fails to retain genuine users.

Web3 social applications emphasize decentralization and user sovereignty, allowing users to control their data and privacy without relying on any centralized platform or operator. They also offer a range of applications where users can engage in various social activities — video viewing, post sharing, instant messaging — with a single digital identity across different protocols. Examples include Cyber Connect and Lens Protocol, which enable diverse social interactions under a unified identity.

Despite these theoretical advantages, most projects still rely on traditional social applications like Discord or Telegram. The main challenges Web3 social applications face include:

1. Financial-driven force: Most Web3 social application engagements depend on economic incentives, which may lead to low engagement and lack of longevity.
2. Data Storage Issues: User information scattered across multiple chains creates significant pressures for analysis and storage, limiting effective data utilization.
3. Poor user experience and limited user base: Current Web3 social applications often need more user experience and user base.

Because of these, Web3 social applications often fail to gain mainstream traction and remain niche. According to Statista, the entry benchmark for the top 15 social applications is 500 million monthly active users in Web2, far exceeding Binance’s 200 million registered users. Overall, the mainstream adoption of Web3 social media remains a distant goal.

Farcaster’s Unique Approach

All that made Farcaster’s emergence more noteworthy, especially in its approach to using Web3 technology to penetrate the Web2 market.

Farcaster is built on Optimism, an Ethereum Layer 2 scaling solution, which allows developers to utilize its pre-built smart contract to build applications. Key features of Farcaster include:

• User-Controlled Data: Users own their accounts on Farcaster and can seamlessly migrate data across different applications.
• Privacy Protection: Farcaster employs a distributed data storage architecture and end-to-end encryption, maximizing user data security and privacy.
• Interoperability: Farcaster enables users to interact across different applications using a unified identity, lowering third-party developers’ barriers to creating new applications and custom interfaces.
• Frames: A new feature called Frames can turn any posted content into interactive applications, enhancing engagement and functionality.
• Warpcast: Farcaster’s team developed Warpcast, a wallet application with a Twitter-like interface that allows users to share posts, interact with others, and showcase their NFTs.
• Open Protocol: As an open-source protocol, developers can create social dApps on Farcaster, enriching the ecosystem.

To smoothly use the Farcaster network, one must download its paid APP, Warpcast, from the Apple Store. Priced at $5, even after Apple’s 30% commission cut, it enables the development team to get a steady cash flow.

Farcaster’s openness has attracted numerous developers and projects to build various social applications on it. For example, after being acquired, the Mirror team shifted its focus to developing Kiosk, a blockchain-based version of instant messenger, on Farcaster.

The iPhone Moment for Web3?

In a recent appearance on “Onchain Stories,” Coinbase founder and CEO Brian Armstrong discussed how this is going to be another iPhone phenomenon for Web3, citing Farcaster as an example with the potential to onboard billions into Web3.

Farcaster shares similarities with Telegram, which is highly open-source, allowing anyone to build their own APP based on its source code. Farcaster operates similarly. For a complete and smooth experience, users can use the official Warpcast. However, the official version also has more limitations. For example, the official APP is more focused on English-speaking users and will not expand to other languages for the time being.

In terms of on-chain data, Farcaster had just 2,400 daily active users in January, 20,000 in February, and 500,000 by June, the total users surpassed 500,000, with protocol revenue reaching around $1.8 million. Following a $150 million funding round led by A16Z and driven by the anticipation of token issuance, user numbers have steadily grown, with daily active users approaching 70,000.

While these numbers pale compared to mainstream Web2 social giants, they are significant for Web3 social applications, especially given that these are paid users, lending more credibility than claims of millions of free registered users.

Conclusion

Since ENS, Farcaster is the most exciting application in the Web3 space. In a way, Farcaster is a test of Web3 user numbers, showing that 500,000 people are willing to engage in Web3 activities beyond finance activities.

However, expanding from 500,000 users to rivaling mainstream social applications will require more time and exploration.