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Social media has been an integral tool in our modern lives to connect with people all over the world, maintain good ties, and share information and thoughts. It is critical to keep connections with a distant friend or even with your business partner. But when it compromises your privacy, it can be tormenting. With the rising criticisms of social media for issues like frequent data breaches, lack of privacy, centralized control, and compulsory monetization, the demand for more secure technology has increased. SocialFi is a new paradigm that utilizes the positives of both social media and decentralized finance to resolve the challenges as we move ahead in a decentralized world.
What is SocialFi?
SocialFi also known as Social Finance, is a blockchain model that offers a web3 approach by combining the features of social media and decentralized finance. This integration of blockchain technology, tokenization, and smart contracts has enabled social media to leverage its features. Unlike traditional practices, SocialFi is expected to feature a decentralized approach, giving its users the ability to:
- Own their data: Users can restrict the unregulated circulation of their personal data. It allows them to securely create and manage social media content without the risk of security breaches. They can decide on what to share, how to share, and what should be kept safe. Decentralization gives more power to its users to securely store the data on blockchain networks.
- Improved interactions: The decentralized nature of DAOs (Decentralized autonomous organizations) allows content creators to participate in the platform’s censorship decisions.
- Direct Monetization: Content creators can now monetize their content, with digital ownership of data. Creators may get rewarded in the form of cryptocurrencies without any intermediaries involved. Users can own their digital artworks as Non-Fungible-Tokens (NFTs) and monetize them.
SocialFi opens new doors for creators, influencers, and developers to interact with the platform and utilize the potential of technology. The decentralized ecosystem allows users to own their data, interact with and monetize it without the presence of any intermediaries to increase data security. Unlike traditional social media platforms like Facebook, Twitter, and LinkedIn, which are controlled by a regulating authority managing the expenses, data, and other means of revenue generated, SocialFi with its decentralized nature allows a transparent ecosystem. Users are allowed to completely own, regulate, manage, and monetize their data, which aligns with a broader vision of Web 3 services.
Key Features of SocialFi?
SocialFi platform gives incentives to its users for content creation and community engagement activities. Apart from this, it offers crypto tokens as rewards for engaging with the media by posting, liking, commenting, and sharing on various platforms. The tokens hold value in real life, attracting more participation from users. Integration of blockchain ensures decentralization of the platform, preventing concentration of power, and ensuring more transparency and security in the network.
SocialFi allows its users to participate in decision-making through DAOs (Decentralized Autonomous organizations), where the token holder can cast their votes. Integrating NFT into social media platforms facilitates interoperability and token exchanges. Unlike traditional social media platforms, SocialFi gives ownership rights to creators to circulate and monetize their content without the need for intermediaries.
Where it integrates?
SocialFi, with the momentum it created in the market, has opened new doors, with a significant growth rate of 14.8%. It can be integrated with several social media projects to leverage its potential with SocialFi platforms leading the way.
Decentralized Social (DeSo)
Launched on Ethereum, Decentralized Social (DeSo) operates by reducing transaction fees and scalability, allowing it to store large data chunks. It ensures that users have complete ownership of their data, allowing them to monetize and receive monetary rewards.
Lens Protocol
A polygon-based graph where users can create and have complete control over their community. It was developed to mitigate the data abuse issue raised by Facebook. Creators should get prior permission from the users to air ads. It also permits them to charge for ads and communicate directly with the creators.
Minds
Minds emerged as an alternative to social media platforms like Facebook or Twitter, where users can earn Mind tokens for liking, sharing, and commenting on posts, which can be later converted into cryptocurrencies. It provides services like encrypted messaging to improve its data security.
OpenCampus
It integrates blockchain technology into the education sector to bring new revolutions in this sector by reshaping the perspective of learners, mentors, and institutions. This decentralized platform uses edu tokens to facilitate transactions and pay rewards. Emerged in 2024, OpenCampus intends to collaborate with other platforms like Genesis and Gems.
FriendZone
Known to be launching on Polygon, it provides its users a platform to engage and build new relationships while earning rewards, which can be easily converted into economic incentives. Like other SocialFi platforms, users are expected to support creators by engaging on the platform to receive a token.
Conclusion
SocialFi is a promising technological platform that represents the future of Web 3 services offering new opportunities for users and creators alike. Content creators can develop and circulate social media content without any security concerns. This removes the presence of any intermediaries for the purpose of monetization, which ensures that creators are rewarded well for their efforts. Moreover, creators can address the existing challenges of data breach and insecurity in traditional media platforms. While decentralized takes over several industries, this integration contributes to creating and developing user-friendly and non-centric ecosystems.
