Scarcity Networks: Social Networks on Web3
The power of web3 is what originally got me into crypto. I analyzed the web2 platforms as an equity research analyst at Barclays, and immediately recognized the potential of web3 to fix much of what I thought was broken in web2 social networks.
Early conversations about blockchain-based social networks were mostly focused on what could be accomplished by leveraging a different data structure, centering the conversation on “data ownership,” privacy, and digital identity. The switching argument was values-based and not compelling enough for most to deal with any degree of friction on decentralized networks.
Now, as social networks begin to blend with DeFi, the switching argument is about economic incentives, rather than moral imperatives, and the novel functionality they offer: publicly trade and display cultural symbols; invest with and in your friends; earn your way into exclusive social circles; connect directly with your favorite creators; prove ownership of digital assets. Eventually, activity on these networks will create an open social graph that is used to offer better DeFi rates and/or lower collateralization ratios. These new social networks combine social and financial capital, making them approachable to the mainstream in a way that DeFi wasn’t. Everyone understands social capital.
For obvious reasons, this article must live on a web3 platform. Read my full thoughts here.