The Future Development of SocialFi: Who Will Lead the Social Revolution?

SocialFi, as an emerging sector in the blockchain field, is still in the early stages of development and has not yet seen a true killer application. However, considering the strong monetization capabilities of social traffic in the Web2 world, SocialFi still holds enormous potential for future development.

The development of SocialFi can be traced back to around 2017, when a number of early projects emerged, but most of them have disappeared due to reasons such as immature blockchain technology. The year 2021 can be regarded as the first year of SocialFi, as a number of new projects completed financing and remain active to this day. In 2023, the explosive popularity of projects like Friend.tech has once again sparked market attention towards SocialFi.

The total market value of the SocialFi sector is currently only $1.7 billion, accounting for about one-thousandth of the total cryptocurrency market value, far lower than mainstream sectors like GameFi and NFTs. This stands in stark contrast to the huge profit margins of traditional social platforms and also indicates that SocialFi is expected to experience explosive growth in the future.

The SocialFi projects are mainly divided into two categories: social protocols/graphs and social applications. In terms of social protocols, Lens Protocol, Farcaster, and CyberConnect are prominent representatives. On the application side, projects like Phaver and Warpcast have achieved good user growth.

Compared to traditional social platforms, SocialFi has a natural advantage in protecting user privacy and redistributing the value of traffic. However, there is a common issue of high entry barriers in current SocialFi projects. In the future, SocialFi projects need to make efforts in the following areas:

1. Optimize user experience and lower the barrier to entry.
2. Design effective incentive mechanisms to attract high-quality content creation.
3. Explore more application scenarios to increase user engagement.
4. Strengthen interoperability with traditional social platforms

Although SocialFi cannot currently shake the position of traditional social giants, with the advancement of technology and the improvement of user awareness, we have reason to expect SocialFi to lead a new wave of social revolution in the future.