SocialFi is a system that provides users with a revenue-generating opportunity through a decentralized and blockchain-based social media structure.
Some of the benefits of SocialFi include In-Platform transactions, crowdfunding, decentralization of social platforms and decentralized governance, eliminating censorship, promoting freedom of speech, and rewards for users.
The world of Web3 introduces a different and innovative narrative to decentralization, showing that several industries, other than the financial system, can benefit immensely from a decentralized structure that keeps users at the core of its activities. We’ve seen this development in the gaming industry with the introduction of Gamefi, and now, SocialFi has created a similar trend by introducing a more user-based social media structure.
Unlike the Web2 social media structure, where influencers struggle with what constitutes adequate pay for content creation, creating a social media structure built on blockchain includes a revolutionary disruption for more efficient and rewarding social media. Introducing SocialFi projects is bound to revolutionize the existing social media structure, creating a secure way for earning and social networking while rendering the system more immutable.
What is SocialFi?
SocialFi projects occupy a space where Decentralized Finance (DeFi) meets the everyday use of Social Media to provide users with innovative support for social networking, content creation, content sharing, in-app or platform transacting, blogging, and daily social interaction.
SocialFi projects embody the notable features of blockchain technology to offer users more efficient tools for secured social interaction through end-to-end encryptions. The SocialFi structure makes users prominent participants in the space by creating practical social tools and a more attractive earning mechanism in this niche.
Gary Henderson, a creator of the Solana-based SocialFi application, aptly captures the unique selling point of SocialFi in his words: “Here, we’re saying the users are our Clients and we’re selling to our users and they’re supporting their favorite creators…” This departs from the usual model in the Web2 structure, where users are often the product and are also made to pay to support their favorite creators.
Now, let’s examine some of the remarkable projects in this niche.
Dmail is a multi-chain mailbox built and supported by BNB Chain, zkSync, Base, and other blockchains with over 591,000 monthly wallet interactions according to DappRadar.
Dmail is a decentralized Web3 mail tool providing users and projects with a more secure mailing system that guarantees users’ privacy. The project departs from the service of regular Web2 mailboxes like Gmail to create a platform where users can enjoy efficient functionality with total control over their inboxes.
The project offers two services, which are mail notification and message service. With it, decentralized applications can employ a multi-chain and decentralized framework to send real-time notifications or alerts to users. With Dmail, everyone can enjoy a more secure, cross-chain communication protected by encryption.
With over 179,000 monthly wallet interactions at the time of writing, Hooked is a SocialFi platform built on BNB Chain to foster Web3 learning. By providing users with the required knowledge to navigate the web3 space while offering rewards for each learning process, Hooked does not only occupy a distinct position in the web3 space; instead, it creates a space of tech-savvy individuals who are capable of exploring investment and earning opportunities in the crypto and web3 space generally using the requisite knowledge.
Combining learning with entertainment, the Hooked Protocol pioneers an immersive Web3 structure that fosters adoption. Its seamless learning process has successfully onboard millions of learners and builders interested in understanding Web3 infrastructure and ecosystems.
Friend is another SocialFi application built on BNB Chain with over 32,000 monthly wallet interactions according to DappRadar. It provides users with a passive earning mechanism while retaining the primary usage of social media, allowing users and creators to make friends. Hence, it shares a striking feature with the regular web2 applications.
However, Friend 3 takes superior steps ahead of the web2 social media structure by providing a platform backed by the vision of promoting a user-centric platform where creators and users can enjoy security and individual control over their data and experience. Friend 3 introduces a decentralized donation and event ticketing mechanism, digital identity security, pay-per-group communities, and more.
While the Web3 space boosts remarkable user growth and the introduction of more projects, the ability of these projects to gain the required visibility and remain in the limelight remains a notable subject of concern; this is where Chappyz comes in. Built on the BNB Chain, it introduces a more healthy and growing social structure for projects to utilize and develop a more dynamic and supporting community of users. Unlike the regular followers on Web2 social applications, Chappyz introduces an avenue to grow in numbers and value. Hence, users are no longer random followers but people sharing similar or related beliefs and ideas.
To achieve this, Chappyz employs an AI-powered analysis bot to give transparent and accurate remarks about communities and the marketplace in the ecosystem. This benefits investors who can now identify projects enjoying reasonable support from their communities and user base.
In crypto and web3 space, visibility is a prerequisite for growth. Hence, projects engage in endless campaigns on different social media platforms to garner the interest of users. However, the existing Web2 marketing strategy features an unreliable approach to marketing, consequently, growth in followers only sometimes results in high engagement and participation as expected.
Poolz Boost is another SocialFi platform introduced by Poolz Finance to provide upcoming projects with the required visibility. Poolz Boost uses the Quest-to-Earn structure to create a successful path to take projects to the spotlight and enhance the sustainability of Web3 for all. Hence, the benefit attached is in two folds – Projects enjoy access to a large, interested, and vetted audience, while web3 users are compensated for their participation in simple social tasks.
The introduction of Poolz Boost represents a perfect transition from Web2 marketing strategies to a more user-centric approach to ads and campaigns. While users have access to endless incentives, the platform eliminates the constant breach of privacy using smart algorithms to connect users and campaigns.
Finally, making money through social media is not a new thing; however, creating platforms that provide a remarkable earning structure for social media influencers and users gives SocialFi a superior edge over the existing market.
However, SocialFi projects are challenging. To get more support from social media users, SocialFi projects will need to overcome the issue of scalability, which is often associated with blockchain, to handle millions of users like we have in the Web2 space.