Farcaster Review: The SocialFi project frequently mentioned by Vitalik Buterin

Farcaster is a platform for building social network apps like Facebook, Twitter, or YouTube. They live on a blockchain, making it fully decentralized. Other words, the community, rather than any organization or person, decides all the data, updates, and changes related to Farcaster.

What is Farcaster?

Farcaster is a decentralized social network built on Ethereum. It is a public social platform, like Twitter and Reddit. One can create profiles, cast posts, and connect with others. They have full ownership of their accounts and relationships with other users, giving them the freedom to switch between various applications.

Farcaster uses blockchain technology to link and handle user identities in a secure manner, while maintaining decentralization and anonymity in the process. More importantly, scalability and adaptability to new technologies continue to be the focus to maximize the value received from their identities by users.

Read More: Layer-2 SocialFi Lens Network Based On zkSync Technology Launched

Main feature of Farcaster

• Decentralization Focus: Farcaster is constructed on Web3, meaning users can maintain full control and custody over their personal data.
• Ease of User Interface: Farcaster brings with it an interface and features similar to X, which is quite easy for users to interact with.
• Developer Support: Farcaster provides tools and a programming framework that make building social dApps easy. The decentralized social network uses a network of peer-to-peer servers—hub—for the storage of user data. Huge savings are made because of this in terms of storing user data and the distribution of content.
• Decentralized Identity: Farcaster empowers users to have the capability of establishing a decentralized identity that gives consumers control rights and full privacy.
• On-Chain and Off-Chain Integration: All activities happening on Farcaster are recorded on the Ethereum blockchain, ensuring transparency and censorship resistance. Farcaster leverages the latest technologies to ensure the data of users is secured.

How Farcaster works

Farcaster has a hybrid architecture that stores identity onchain and data offchain.

Onchain​

Farcaster’s onchain systems are implemented as contracts on OP Mainnet. Actions are performed onchain only when security and consistency are critical. Use of onchain actions is kept at a minimum to reduce costs and improve performance.

Only a handful of actions are performed onchain, including:

• Creating an account.
• Paying rent to store data.
• Adding account keys for connected apps.

Offchain​

Farcaster’s offchain system is a peer-to-peer network of servers called Hubs which store user data. The majority of user actions are performed offchain. These include:

• Posting a new public message.
• Following another user.
• Reacting to a post.
• Updating your profile picture.

Actions are performed offchain when performance and cost are critical. Use of offchain actions is typically preferred when consistency isn’t a strict requirement. Offchain systems achieve security by relying on signatures from onchain systems.

Read More: Top 5 SocialFi Projects You Should Know In 2024

Farcaster Ecosystem

Warpcast

Social media is now attracting a host of foreign KOLs, including but not limited to: Tim Beiko – Ethereum core developer; Jesse Pollak, who is the co-founder of Base; most notably, Vitalik Buterin, who is also a co-founder of Ethereum, and is quite active on the platform. On February 6th, Vitalik posted in praise of both Farcaster & Lens, saying they are permanent social apps unlike the Ponzi scheme of Friend.tech, which is being predicted for the end of 2023. The platform resembles Twitter in design, and here, users can post a maximum of 320 characters per post. Additionally, there’s an encrypted messaging feature called Warpcast.

A major impetus to Farcaster’s surge in 2024 was done with the new feature by Warpcast: Frames. Frames allow applications to function within posts on the platform, not having to redirect users to another place. This facilitates the ability of users to trade, mint tokens, and access other posts directly on Warpcast. People have made a lot of speculation regarding Farcaster organizing an airdrop, huge airdrop rounds of meme deals for users, and boosting its monthly active users by 50x on Warpcast. From a low of around 5,000 DAU on 28th January, it has reached over 250,000 on 31st March. There have been multiple incentives for early adopters of Warpcast: NFT minting deals—x5-x10—by the project and Meme Deals, including DEGEN, DOG, and TOBY.

Degen Chain

Introducing Degen Chain, a new Layer 3 project from DEGEN—the memecoin that took the Base Layer 2 by storm, reaping more than a 50x value increase in March, and launched on March 28. Brought to life with the power of Arbitrum Orbit technology and AnyTrust, Degen Chain was built on the Base blockchain platform. Within just one day of launching, Degen Chain witnessed 2 million transactions, 1 million USD bridge funds, and above 24,000 active addresses.

The DEGEN token will be the gas fee currency on this Layer 3 network. In addition, DEGEN will be distributed among Farcaster users in exchange for creating quality content. DEGEN also powers a tipping culture on Warpcast to enable users to tip DEGEN through comments—casts—and to display an icon of the DEGEN logo.

A very noticeable conjecture is that, while not officially confirmed, the team behind DEGEN is supposed to be either directly affiliated with Farcaster or to have a very tight relationship. Recent news regarding Farcaster’s parent company nearing the completion of a funding round at a unicorn valuation of 1 billion USD led to a surge in daily content on Farcaster, shooting from 1 million to 3 million, translating to a hundredfold rise from the average level in 2023.

Paragraphs

Paragraph is a SocialFi platform in which creators can build communities and generate money with a content monetization model, much like Substack and Medium, incorporating Farcaster, storing on Arweave, and AI.

Memberships buy access to content, while Paragraph shares revenue transparently with content creators. The project successfully raised 1.6 million USD from some highly valued investment funds, such as Binance Labs and FTX Ventures. Paragraph was listed among the top 6 projects in September 2023 to receive funding from the Base Ecosystem Fund—truly attributed to huge potential for the future.

Other potential projects

In addition to the top 3 projects – Warpcast, Degen Chain, & Paragraph – the Farcaster ecosystem also features several other notable names:

• Farcord: A project that mirrors Discord, enabling communication with friends via voice and text.
• Flink: A platform resembling Reddit, providing a forum for sharing community news.
• Frens: A decentralized messaging project aimed at safeguarding user data and preventing eavesdropping.
• Ponder: A Social Survey platform

Tokenomics

At present, the project has not provided any official tokenomics information.

Team and Investors

Team

• Dan Romero (Co-founder), was previously the CEO of Coinbase exchange in 2014. In 2020, he teamed up with Varun Srinivasan to create Merkle Manufactory.

• Varun Srinivasan (Co-founder) worked as a Product Manager for OneNote (developed by Microsoft) from 2010 to 2013. In 2015, he transitioned to Coinbase, holding the position of engineering director until 2020 when he departed to launch a startup with Dan Romero.

Investor and partners

The project has successfully raised a total of $180M through two funding rounds:

• Series A Round: The project has raised $150M, bringing the total project valuation to $1B. Notable participants include a16z crypto, Paradigm, and USV, … Massive investment into Farcaster is a sign that people are confident in decentralized technologies. These funds will develop the protocol, expand on the ecosystem, and create new innovative apps. A milestone into revolutionizing online interactions.
• Seed Round: The project has raised an impressive $30M in its Seed round, a substantial amount, with notable participants including a16z crypto, Coinbase Ventures, Multicoin Capital, and more.

Roadmap

After successfully closing the $150M Series A funding round, the project announced that it will focus on

• Growing daily active user
• Adding developer primitives to the protocol like channels and direct messaging

Conclusion

Farcaster is a platform for creating Social dApps—an area that has been gaining significant attention in 2024. Moreover, the project features a team with broad experience from roles at Coinbase and is backed by top-tier investors such as a16z and Multicoin Capital.

According to Coincu, this project is huge in potential. You may join the airdrop hunt and be one of the pioneers to hop onto the SocialFi wave.

FAQs

1. How does Farcaster ensure that data is portable and users are sovereign?

Farcaster achieves data portability and user sovereignty through the design of having users own their social graph and content, such that switching between different applications built on Farcaster would not result in loss of data or connections. This ensures that users always have complete control over their digital identity and interactions.

2. What are the key components of the Farcaster protocol?

Key components of the Farcaster protocol include the Farcaster Identity, a unique identifier for every user, the Farcaster Hub—decentralized storage of user data and social graphs—and the Farcaster API, which developers can use to build applications that interact with the protocol.

3. How does Farcaster handle moderation and enforcement of content policy?

Applications built on the Farcaster protocol are in charge of their own moderation and content policies. This decentralized approach allows different communities to enforce rules that best suit their users instead of a one-size-fits-all policy set by a central authority.

4. What are some potential use cases for applications built on the Farcaster protocol?

Possible use cases for applications built on Farcaster include decentralized social media platforms, networks for content creation and sharing, professional networking sites, and any social application that benefits from user-owned data and decentralized control. The protocol’s flexibility allows for an incredibly wide range of innovative social applications.

DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.