What is SocialFi?

Quick Bites

• SocialFi is a platform that combines social networking and decentralized finance (DeFi).
• It allows users to connect and interact with each other while accessing a range of financial services.
• Users can earn rewards and incentives for their social activities and contributions to the platform.
• It implements community-driven governance, giving users a say in decision-making processes.
• SocialFi aims to create a more inclusive and accessible financial ecosystem through social connections.

SocialFi Explained

The rise in popularity of projects on Web3 and decentralized finance (DeFi) can be attributed to a growing disillusionment with centralized institutions ranging from banks to trading platforms, with perhaps the involvement of excessive middleman fees as the greatest spur.

In particular, frustrations have also emerged regarding banks exerting control over lending decisions and fund allocation. Consequently, blockchain projects have gained traction due to their promise of autonomy from third-party entities.

In line with this, the emergence of future social networks has now come into focus. Traditional social media platforms, such as Instagram, Facebook, and Twitter, primarily generate revenue for tech corporations rather than ordinary users. Content produced by users and uploaded on to these social media sites are also oftentimes subject to harsh censorship regulations that content creators have no say over. Additionally, content creators typically lose ownership of the content that they have uploaded on to these platforms.

If these sentiments sound familiar to you, they probably should - they echo the very same concerns faced by users within Web2. Consequently, a trend has emerged towards decentralization in the realm of social networks, allowing content creators and users to retain full ownership over their content and be able to freely monetize and generate revenue from their hard-earned efforts.

SocialFi, also known as Social Finance, represents a platform that integrates the principles of social networks with DeFi. In essence, it represents a new phase in the evolution of social networks. At present, the corporate institutions and tech giants that lead the social media landscape such as Instagram and Twitter are the ones that exercise control over users' data within social networks. SocialFi is meant to revolutionize this game, placing users, and not the corporate institutions that dominate the current social media landscape, at the centre of their work.

Essentially, SocialFi platforms operate based on users' earnings. By providing content creators the opportunity to generate income through content creation, advertising, communication, news feed consumption, NFT minting, and gaming activities, users are better empowered to monetize their social interactions and source for new and innovative ways to engage with others at the same time.

How can SocialFi Solve the Existing Problems of Web2?

The surge in popularity of SocialFi can be attributed to its potential to address the limitations of Web2 social networks:

Privacy

One of the primary concerns that permeate throughout the current Web2 space would be the protection of personal data and user privacy. Current internet users are required to disclose personal information such as phone numbers and email addresses when registering on social networks, which is then stored on centralized servers. This arrangement poses risks, including the potential for server crashes and data breaches. In contrast, SocialFi platforms adopt a decentralized approach through the use of DApps (decentralized applications), eliminating the need for data collection and storage by relying on decentralized systems.

Difficulty of Scaling

The scale of data generated by Facebook is truly immense, amounting to a staggering 4 Petabytes per day. With over half a million comments posted, nearly 300,000 status updates, 4 million post likes, and 136,000 photo uploads occurring every minute, the question arises as to whether blockchain technology is capable of handling such colossal volumes.

DeSo, the blockchain layer specifically developed for SocialFi applications, asserts its ability to scale more effectively than most existing layer-1 chains due to its purpose-built design for SocialFi use cases. To address scalability concerns, DeSo employs a range of techniques, including indexing, block size management, warp sync, and sharding.

The platform's scalability claims are exemplified by its reported capacity to process 80 posts per second for a user base of four million, surpassing Twitter's rate of 6,000 posts per second across 300 million users.

Freedom of Speech

Another issue that SocialFi tackles is the concept of freedom of speech. If the entire purpose of social media is to engage with others in a free and unbridled manner, then users should likewise be able to express their thoughts and opinions without being subject to control by authorities or security forces.

Granted, not all content should be propagated or disbursed on social media platforms, such as with the likes of racist or hate speech. The question then comes into play on how best to regulate such malicious content - via a centralized framework where guidelines are produced without any input from various communities, or through decentralized social networks that empower network participants to manage the content themselves.

The premise laid out in the latter would be for regulations to be introduced within a decentralized framework such that a power shift occurs to place users and communities at the forefront when it comes to deciding and voting on what content is considered malicious or harmful. Additionally, artificial intelligence algorithms can play a role in identifying and removing malicious content, striking a balance between freedom of speech and content control.

Copyright

The topic of digital copyright is another area where SocialFi offers potential solutions. Traditional copyright models often struggle to adapt to the realities of the digital era. Even with official licenses, authors may experience a loss of income when distributing digital content. SocialFi platforms enable the establishment of automated copyright systems, akin to decentralized content markets, where authors can directly sell their work to buyers without intermediaries. This approach ensures that content creators receive full compensation for their work, while users can have confidence in purchasing original content.

Examples of SocialFi Platforms

With a multitude of various SocialFi platforms available on the market right now, picking the right one to explore may be challenging. The following are several notable SocialFi projects that you can try your hands on, right within the convenience of the integrated DApp browser in your Bitget Wallet:

Skiff

Imagine a world where you have complete control over your online interactions and personal information. A world where you can communicate, share files, and plan your life without the prying eyes of government agencies or internet service providers. Skiff, the groundbreaking platform, makes this vision a reality by empowering users to create and manage secure private networks.

The heart of Skiff lies in its ability to create secure rooms and channels for communication and file sharing. These virtual sanctuaries are shielded from the prying eyes of third parties, ensuring that your conversations remain private and confidential. Whether you're discussing sensitive business matters or sharing personal moments with loved ones, Skiff provides the fortress of security you need.

But Skiff doesn't stop there. It goes beyond simple communication and file sharing, offering a comprehensive suite of features designed to enhance your productivity and organization. On this revolutionary platform, you can create notes, jot down brilliant ideas, and mark important dates and plans in a seamlessly integrated calendar.

ApolloFi

ApolloFi stands out as an exceptional project that spearheads the SocialFi movement, breathing life into a platform tailored for creators.

By harnessing the cutting-edge capabilities of Polygon, Ethereum, and BNB Chain, ApolloFi unlocks a realm of possibilities where creators can turn their passions into lucrative opportunities. ApolloFi's ingenious social-to-earn model invites creators of all kinds to take their first steps into the Web3 space. With a seamless and intuitive platform, creators can effortlessly connect, collaborate, and showcase their talents to a vibrant community.

Coinvise

Coinvise is a pioneering social token issuance platform that focuses on API integration, enabling developers to seamlessly integrate tokens into their existing platforms. It empowers creators and communities to mint social tokens and establish incentives within the Ethereum and Polygon networks. These tokens can be utilized for rewards, airdrops, crowdfunding, access control, NFT integration, and more. Coinvise revolutionizes community engagement, fostering meaningful interactions and unlocking new possibilities by leveraging blockchain technology.

With Coinvise, developers can effortlessly incorporate social tokens into their platforms through user-friendly APIs, while creators enjoy the flexibility to mint tokens and deploy them on the Ethereum and Polygon networks. This innovative platform offers diverse applications, including rewards, crowdfunding, access control, and NFT integration.

Red Packet Interactions

Feeling overwhelmed with all that SocialFi has to offer? Not to worry, Bitget Wallet's Red Packet function offers a simple way for users to interact with others in a straightforward and simple manner.

Bitget Wallet's cryptocurrency red packets support currencies from 6 chainsincluding Ethereum, BNB Chain, TRON, Polygon, Arbitrum, and Optimism. With Bitget Wallet's red packet function, users can easily send red packets to anyone with a Bitget Wallet, and the funds will be credited to the recipient's Bitget Wallet accounts accordingly, allowing them to exchange the funds for other currencies or purchase NFTs within Bitget Wallet

Try sending a red packet today on Bitget Wallet and begin your journey into the social side of Web3!

Closing

Despite facing challenges in infrastructure and economic models, SocialFi platforms exhibit significant potential. As the world rapidly embraces creator economy models, these platforms represent a substantial stride toward that direction.

For social networks built upon DeFi principles to truly demonstrate robustness, they must weather several downturns and successfully navigate through them. This principle certainly applies to the realm of SocialFi as well. However, with favorable market conditions and continued investment prospects, the growth potential for SocialFi projects is certain to be boundless.

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