Li Jin: Assets and Ideology in Web3 Social Networks
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Li Jin: Assets and Ideology in Web3 Social Networks
The way to build a successful Web3 social network is asset-first, not ideology-first.
Navigating Web3 tides with focused insightsAuthor: Li Jin, Partner at Variant
Translation: Luffy, Foresight News
There are two primary approaches to building Web3 social networks: asset-first and ideology-first.
The asset-first approach is built on the premise that users are profit-driven, placing money front and center by unlocking digital ownership. Financialized features enable users to spend and earn within the network.
BitClout is a classic example of an asset-first Web3 social network, where users speculate on the potential of public figures by trading creator tokens, creating a speculative social game. Lens is another example of an asset-first Web3 social network, where user posts are minted as NFTs that can be collected and purchased—top creators earning up to tens of thousands of dollars from collected posts. PFP NFT communities can also be seen as asset-first social networks: interest groups formed through collectibles. In all these cases, user motivation for social engagement isn't purely intrinsic—it involves, at least to some degree, potential economic gain, much like collecting stamps or baseball cards: enjoyable in itself, but also potentially profitable as values appreciate.
In contrast, the ideology-first approach requires alignment with users' values and ideals. This means emphasizing characteristics enabled by blockchain technology, such as censorship resistance, data privacy, and the portability of social graphs and content. The actual user experience of such Web3 social products may resemble Web2 counterparts quite closely, differing mainly in that part of the data is stored on-chain.
My view is that Web3 social networks will succeed by adopting the asset-first approach—creating monetization opportunities that attract users. In other words, these networks aren't purely social—they're socioeconomic networks. This approach also creates a more distinct and differentiated user experience, which in theory should have broader appeal (income is a universal need, while ideals are too abstract for many). It also mirrors the adoption path of cryptocurrency in other domains, including NFTs, DeFi, and even L1s: the desire for economic returns has driven new networks and applications, playing a crucial role in widespread adoption.
To be clear, adopting an asset-first approach does not mean catering only to speculators or creating easily manipulable financial games. Social networks are vulnerable to spam and bad actors, which can generate negative network effects. Unlike DeFi lending protocols, where all liquidity is valuable, in social networks, even if users are financially motivated, the quality of content and participants matters. Simply rewarding all content creation or usage is too blunt a mechanism and could flood the network with spam, useless, or even harmful content.
A successful financial model at the core of a Web3 social network should combine intrinsic and extrinsic motivations.
Stealcam, a content-sharing platform, allows fans to profit from selling NFTs they own—an approach that attracts both yield-seeking speculators and genuine fans.
An asset-first approach also enables the creation of novel social graphs. Social networks are built around different types of social graphs, which form the foundation of their network effects: Facebook started by leveraging your real-world friends / college campus graph; LinkedIn maps your professional relationships; TikTok builds its graph based on your interest-based behaviors within the app. Asset-first social networks can pioneer and popularize ownership graphs—users connected through shared on-chain ownership. PFP communities represent a primitive version of this idea already in existence. As users accumulate more on-chain ownership data, ownership graphs can richly reflect user interests.
In conclusion, now is a rare window of opportunity to build Web3 social networks. Established Web2 social companies like Twitter and TikTok are undergoing major shifts. Our vision for Web3 social networks is rooted in leveraging crypto’s unique incentive mechanisms to deliver differentiated user experiences.
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