Understanding Zora's Economic Flywheel: Old Recipe, New Opportunity

Author: dpycm

Translation: TechFlow

Disclaimer: This article is for informational purposes only and does not constitute any financial advice. The author has personal investments in the aforementioned tokens. Any views expressed below are solely those of the author, should not be taken as a basis for investment decisions, and should not be construed as recommendations or advice regarding investment transactions.

Why Zora feels familiar—and why that’s a good thing.

That strange sensation, as if in some way you’ve already lived through what’s happening now.

I’m sure everyone has experienced déjà vu at some point in life—whether it's a quote, an event, or just a simple interaction.

Strangely enough, I felt this again recently when reading about Zora’s flywheel. It immediately reminded me of how I felt back in October 2024 when I first read about Virtual’s economic flywheel—déjà vu all over again.

Will history repeat itself with Zora?

SocialFi

As early as August 2023, amid rising discussions within the crypto Twitter (CT) community around consumer apps, we witnessed the rise of Friend.tech. Participants invested in keys of their favorite KOLs, gaining access to private chat rooms, price speculation, and potential airdrops.

However, after a failed token launch, users quickly left, and Friend.tech soon faded into obscurity.

Was SocialFi too early? Or were its underlying mechanics insufficient to attract organic users? More importantly, as crypto gains increasing attention, could consumer apps become hot again?

Zora

https://zora.co/

Unlike Friend.tech, Zora is a blockchain-based social network that functions similarly to Instagram. Its uniqueness lies in the fact that every profile and post is tokenized, enabling creators to directly monetize their content.

Zora creator profile:

https://zora.co/@chloe

How It Works

The $ZORA Flywheel

The $ZORA flywheel:

• Every profile is tokenized

• Every post you publish is tokenized

• Every post you publish is paired with your creator coin

• All creator coins are paired with $ZORA

A 3% fee applies to each transaction. This enables creators to profit from every trade on their posts or profiles.

3% Fee

The fee model is designed to benefit all stakeholders.

Advertising

https://paragraph.com/@socialgraphventures/zora-the-thesis

Advertising is a core component of social media. Zora is pioneering a peer-to-peer advertising marketplace, allowing for micro-targeted ad strategies. If executed effectively, this could unlock significant revenue potential.

Tokenomics

$ZORA has a total supply of 10 billion tokens:

• Community incentives: 20%

• Airdrop: 10%

• Liquidity: 5%

• Investors: 26.1%

• Reserve: 20%

• Team: 18.9%

https://support.zora.co/en/articles/4797185

Unlock Schedule

• Airdrop, community incentives, and liquidity: Totaling 35%, fully unlocked at the Token Generation Event (TGE) on April 23, 2025.

• Team and investors: 6-month lockup after TGE, followed by linear monthly release over 36 months.

• Reserve: 6-month lockup after TGE, followed by linear monthly release over 48 months.

This means team and investor unlocks will begin on October 23, 2025.

Fundraising

https://cryptorank.io/ico/zoraco

Zora has completed three funding rounds, with its largest raising $50 million at a $600 million valuation. Notably, as of this writing, ZORA’s fully diluted valuation (FDV) stands at $800 million—approximately 33% higher than its last funding round valuation.

Price Trajectory

Looks familiar?

This is Virtual’s price trajectory.

Despite being live for only a few months, $ZORA went through a period of low interest and activity—almost like a “seller purge” shakeout. However, driven by integration with its core application and the flywheel effect, $ZORA is regaining momentum and gradually returning to the spotlight.

Team

Social Graph Ventures summarized this team well:

• The team comes from Coinbase and has maintained rapid development, focusing on building unique experiences that merge crypto-native and Web2-native UX.

• They’ve advanced the space with novel ideas such as bond curve-based quoting tokens, content-based tokenization, and referral mechanisms. Zora has demonstrated a willingness to openly experiment and build quickly—traits we value in teams pursuing new social, creator, and monetization models.

• Jacob Horne—Co-founder & CEO, former product manager at Coinbase, led two of Coinbase’s most successful product lines: USDC and Coinbase Ventures. He focuses on Ethereum and DeFi integration. Jacob is known for his deep thinking on crypto market design, NFTs, and creator monetization. He serves as Zora’s public face, frequently sharing vision and updates via interviews and X. He previously worked on crypto fashion projects and has been building Zora since 2019.

• Dee Goens—Co-founder, former marketer at Coinbase, is a veteran of the early NFT movement and creative communities. Dee played a key role in shaping Zora’s early ecosystem partnerships and community strategy. He is committed to making Zora accessible to underrepresented creators and emerging digital culture groups.

• Tyson Battistella—Co-founder & CTO, head of engineering at Zora. Tyson also previously worked at Coinbase, focusing on smart contract infrastructure. He designed many of the protocol components currently used by Zora, including its minting tools and L2 integration. Zora raised $60 million in token funding and recently secured approximately $600 million from Haun Ventures. According to the team, Zora’s “development roadmap” will span multiple years.

Thoughts

With a strong flywheel model, clean UI/UX, support from the Base team, and favorable bull market conditions, I believe Zora can continue to rise through reflexivity.

Price increases → increased interest in Zora → more activity → further price increases.

Remember when CT consensus was that Coinbase was the best onboarding path for retail onto-chain? (We were all shouting for consumer apps!!)

Now, with new Base app integrations, Zora is exceptionally well-positioned to benefit from this wave of user onboarding—if it truly arrives. Just as Friend.tech captured attention, so too will Zora. It usually starts with curious creators and KOLs creating profiles to ride the trend, then the reflexivity builds from there.

Independent teams are incrementally building Zora’s infrastructure: frontends, bots, sniper tools, and more. Traders are already active in trading profiles and content. All of this echoes the early days of the 2023 SocialFi craze, suggesting a new wave may be brewing.

That said, I do have some concerns—mainly whether SocialFi still holds enough narrative power. We’ve already seen its performance early in this cycle, so it might feel less fresh or exciting. In contrast, back in Q4 2024, Virtual fit mainstream sentiment perfectly.

https://dune.com/zorateam/coins

Compared to TGE, Zora’s metrics don’t look impressive yet, but they’ve started to recover following the recent price surge. Markets are forward-looking, and so should we—not just predicting the present, but where things could go in the future. For this reason, I believe metrics will continue improving as the reflexive cycle progresses.

Good narratives don’t start with 100% consensus

I remember during the early days of Virtual’s token launch, when I shared my thesis and shouted about it, many participants hesitated simply because it wasn’t on Solana. There was plenty of fear, uncertainty, and doubt. But just weeks later, as strong players entered and broader adoption followed, the price went parabolic. Today feels reminiscent of that time.

Conditions > Narrative

Overall, I think the investment case is reasonable, with position sizing dependent on individual judgment. Despite $ZORA surging over 700% in the past week, I still believe there’s room for further upside in the coming months.

All it takes is one prominent creator to ignite the frenzy.

Hope you enjoyed the article, cheers!