Over half the world spends two hours a day on social media, proving the industry’s impact on society. Social media has transformed our lives and communications. It has rewired our brains and transformed our civilization forever.
Meta (previously Facebook), Twitter, Google, and Tencent dominate social media nowadays (China). These concentrated giants have monopolized the sector, resulting in services that don’t always serve users’ best interests. SocialFi threatens the current quo.
SocialFi promises to remove users from the limits of traditional social media, giving them data privacy, censorship resistance, and full choice over the sharing and monetization of their personal data.
SocialFi combines social networking and decentralized financing (DeFi).
SocialFi is blockchain-based social media’s next generation. It uses blockchain while adding NFTs and DeFi services like yield farming.
Community tokens allow SocialFi members to vote on proposals and decide the project’s direction, akin to decentralized autonomous organizations (DAOs).
SocialFi networks disseminate data throughout a web of nodes, and everyone who helps maintain functionality is monetarily rewarded. Minimizing data leaks and eliminating single points of failure improves overall security.
SocialFi platforms provide financial rewards above regular social networking. Publishing and sharing content can earn users and artists money. Social influence is tokenized, so users are rewarded for posting traction-generating content.
To comprehend SocialFi and how it can become a trend in 2022, we must look at social media’s present challenges and blockchain’s potential answers.
Facebook, TikTok, Instagram, Reddit, and YouTube dominate social media. These networks are free, convenient, and allow large-scale information and content distribution.
Users lose ownership rights over social media content. Any information provided is sold without their consent, creating a profile that marketers use to target consumers. This information is sold and utilized against their best interests.
The Cambridge Analytica scandal exposed Facebook sold data to alter public opinion and affect elections. If we’re not careful, social media manipulation could lead to “cognitive warfare” between nations.
Loss of privacy and pervasive censorship are other drawbacks with social media. Since the pandemic began, social media networks’ tendency to censor has increased dramatically.
Massive disinformation and toxic social media behavior forced Twitter founder and Bitcoin champion Jack Dorsey to resign as CEO. Dorsey and Block, formerly Square, are reportedly developing blockchain apps. Twitter previously built BlueSky, a decentralized social media network. BlueSky declared independence on 7 February 2022 to implement their goal. Coincidence?
As Web 3.0 decentralizes the internet, SocialFi platforms will become vital for free expression and data sovereignty.
The data submitted to a blockchain cannot be modified or removed. Regular users and content developers can post anything without fear of deplatforming or censorship.
SocialFi platforms aim to ensure algorithm modifications are regulated and content creators earn a fair share of profits by increasing transparency and eliminating middlemen. YouTubers’ revenue has decreased due to stricter constraints, but SocialFi-powered companies like Subsocial and Deeper Network let them monetize directly through their fan groups.
SocialFi demonstrates alternative finance using NFTs and tokens, while DeFi offers yield farming, loans, and more.
SocialFi platforms put user data back in their control, letting them to decide whether to sell it and to whom. These platforms let users receive a percentage of advertising money and choose which items and services to advertise.
Some SocialFi initiatives are already showing great promise. Some initiatives, like DeSo, have raised over $200 million, while others have a working product.
With over 200,000 users, Torum is a thriving SocialFi startup. Torum blends social media, a yield farming hub, an NFT marketplace, and an avatar NFT for metaverse fans.
SocialFi may positively impact the world by rewarding users for enduring commercials, giving content producers a fair amount of cash, and ensuring information flows freely against big tech’s demands.
SocialFi and blockchain-based social media may have a rise in 2022, similar to DeFi in 2020. Innovative networks may accelerate adoption. If effective, many disillusioned users will gladly leave Facebook and Twitter.