Before you discuss SocialFi think about blockchain making its way into every industry, it’s clear that the social media industry will be the next area of concentration. Since the emergence of blockchain, we’ve seen it make its way into different industries with amazing innovative solutions. The Gaming industry is the most recent area where a lot of innovation changes have been made and in our recent Publication, we looked at what has been happening and the future of GameFi in the gaming world.
Social media’s influence on society is undeniable, even though it is still in its infancy. More than half of the world’s population spends an average of two hours per day on social media platforms. The way we live and communicate will never be the same again thanks to social media. weather we accept it or not the media has been part of our lives and has also controlled the way we present ourselves there.
The current social media space is dominated by Web 2 giants such as Meta (formerly Facebook), Twitter, Google, and Tencent (China). These massive centralized players have successfully monopolized the industry, resulting in services that do not always cater to the best interests of users. A new fad called SocialFi, on the other hand, may put the status quo in jeopardy.
What is SocialFi?
SocialFi, which stands for “Social Finance,” is a term that represents the merger of social networking and decentralized finance (DeFi).
In essence, SocialFi is the next phase in the growth of blockchain-based social media. It makes use of the blockchain’s features while also including non-fungible tokens (NFTs) and DeFi services like yield farming.
SocialFi has become a logical advancement from the GameFi concept. If the latter is limited to the monetization of the user’s gaming actions succinctly expressed by the Play-to-Earn model, then SocialFi organically complements it by adding a new model dubbed Communicate-to-Earn, which can be used both as part of a holistic ecosystem and separately.
Similar to decentralized autonomous organizations, SocialFi platforms may be partially owned and governed by their users since community tokens let individuals vote on ideas and determine the project’s destiny (DAOs).
In contrast to conventional social media, where firms store all of the data on a single server, SocialFi networks distribute the data throughout a web of nodes, and everyone who helps keep the system running is rewarded monetarily. As a result, overall security is enhanced by reducing data breaches and eliminating single points of failure.
Fighting Censorship and Regaining Data Sovereignty
According to cybavo “Most social media activity occurs on large platforms such as Facebook, TikTok, Instagram, Reddit, and YouTube. These networks are free to use, offer unparalleled convenience, and allow information and content to be disseminated at a large scale“.
However, users lose ownership rights over the content they publish on these social media platforms. Any information posted is sold without their consent, creating a profile that marketers then use to better exploit the general audience as consumers. Not only is that information being sold, but it’s often being used against their best interests.
The Cambridge Analytica scandal that took place a few years ago revealed Facebook was selling data that was then used to sway public opinion and influence political elections. The problem of bad actors engaging in social media manipulation may even have the potential to reach the level of “cognitive warfare” between nations if we’re not careful.
Other relevant problems with social media include the loss of privacy, which studies correlate with harmful psychological effects, and rampant censorship. Social media platforms are the largest gatekeepers of information on the web, and their tendency toward censorship has increased tremendously since the beginning of the pandemic.
Coupled with massive disinformation and increasingly toxic behavior on social media, it’s no wonder that even Twitter founder and Bitcoin evangelist Jack Dorsey decided to step down from his CEO role. It’s rumored that Dorsey and Block, previously known as Square, are working on blockchain applications. Interestingly enough, Twitter previously tried to build a decentralized social media platform, BlueSky. BlueSky announced on 7 February 2022 that it was now an independent organization formed to implement its vision. Coincidence?
SocialFi Project Development
While SocialFi platforms are still in their early stages, certain efforts are already shown great promise. Several projects are at various stages of development and have varying degrees of interaction with the SocialFi idea. Certain initiatives, such as, have been able to garner significant finance in order to ensure that the SocialFi industry becomes mainstream.
Torum
Torum is the SocialFi ecosystem (Social + NFT + DeFi + Metaverse) that is specially designed to connect cryptocurrency users. The Web3. 0 ecosystems are built on a social media platform, coupled with a yield farming platform for DeFi players, an NFT marketplace for crypto artists, and Avatar NFT for Metaverse enthusiasts.
Torum is a prime example of a successful SocialFi project, standing out amongst its competitors with over 200,000 users. Specifically designed for the crypto community, Torum is a protocol that combines social media with a yield farming hub, an NFT marketplace, and an avatar NFT for metaverse enthusiasts.
DeSo
DeSo is a new layer-1 blockchain built to scale decentralized social applications to billions of users. People can build social apps on DeSo in the same way they build financial apps on Ethereum
Fragma
Fragma blockchain metaverse is a global decentralized application, that provides content creators social mining, GameFi, NFT Marketplace, DAOs, and AR to advertisers that will increase AD performance and make it easier.
We are the first and only platform in the world with social mining. Blockchain-based smart systems will give profit not only to the most popular but to active users too. Comments, likes, sharing posts, etc., will be rewarded with tokens that can be converted into tangible money.
Steemit
Steemit (STEEM) isn’t a brand-new social media platform, but it’s nonetheless a lot of fun. The project has experienced a number of challenges, including a recent attack, but it is now moving forward.
Within the Steemit ecosystem, individuals may establish decentralized blogs and other social media services. You also receive a simple method for monetizing your material. STEEM now has a market capitalization of $122 million.
Final Words
SocialFi has the potential to make a good influence on the world by ensuring that users get compensated for putting up with adverts, content producers are paid fairly, and information flows freely despite big tech’s demands.
After everything is said and done, SocialFi will substitute the bulk of Web 2.0 platforms because rewarding creators is a concept that everyone wants to embrace.
