The Potential of Blockchain Technology in Driving the Future of Decentralized Social Media

Despite the continued popularity of social media sites, users' dissatisfaction with large companies controlling their online social lives is growing, whether due to strict content control or personal data collection. The many alternative applications recently launched reflect this discontent. A new research report explores the potential of cryptocurrency and blockchain to power decentralized social media, an innovative social network model that embodies the Web3 vision of users owning the internet. Although still in its early stages, "DeSoc" has already spawned numerous decentralized applications and attracted millions of users to its vision of on-chain social networking.

Traditional Web2 social media sites have changed the way people communicate by connecting users globally. More than half of the world's population uses social media, and the most popular sites generate huge revenues. However, these sites have also brought typical "Web2" problems: large tech companies ultimately own user-generated content, content moderation teams can remove users from the platform, delete years of accumulated content, and immediately sever the connection between creators and fans. Companies also profit by tracking and selling user data, while closed systems hinder innovation from third-party developers.

The DeSoc network has the potential to leverage Blockchain technology and other Web3 features (such as tokens, anonymity, and Decentralization governance) to address these issues. In short, the goal of DeSoc is to ensure that users "establish direct relationships with audiences and each other." Users can create accounts without providing personal information. They can join specific platforms that match their interests, but still freely communicate with users from different websites using their decentralized accounts. Users can determine their own content review policies. Users who wish to leave a website can easily migrate their account data (including usernames, posts, and follower lists) to other websites.

Specifically, DeSoc applications provide numerous benefits that can protect privacy, support creators, and stimulate innovation, including:

• Freedom of Speech and Privacy. Many DeSoc networks allow users to post with anonymous identities that cannot be linked to their real identities. Users are also less likely to be affected by content removal and platform bans, as there is no central entity to exercise such control. Because the records on the Blockchain are immutable, DeSoc networks provide built-in tools for users who wish to verify their real identities across multiple platforms.

• Ownership and Monetization. Many DeSoc applications do not rely on advertising or data tracking, but instead issue native tokens to raise funds. They then reward user participation by distributing additional tokens for posting or engaging in conversations.

• Innovation. Most decentralized applications are built using open-source code, which means developers have free access to modify and build upon existing code. This encourages collaboration and accelerates innovation.

A large technology company recently launched its own Weibo application, attempting to leverage at least some of its advantages. Although the application looks and feels similar to traditional social media websites, the company stated that it will be compatible with ActivityPub, a decentralized social networking protocol that allows accounts to be hosted on independent servers. This decentralized structure enables users to have better control over their data and allows them to easily interact with other networks on the same protocol.

The DeSoc network faces specific challenges related to usability and content moderation. For example, its distributed nature may make it difficult for users to find specific friends and content. The sheer number of website names can make searching and navigation overwhelming. Sometimes, a site-by-site moderation approach can lead to a de facto content moderation of the entire network. For these reasons, it is crucial for policymakers to understand the DeSoc network and the regulatory areas involved. Specifically, DeSoc applications raise concerns about the potential spread of misinformation and propaganda, as well as the liability of decentralized protocols for illegal or harassing speech (if any). They also lack regulatory clarity regarding data protection and consumer disclosure requirements, as well as the tax implications of token transactions.

Like all decentralized applications built on Blockchain, the DeSoc application has the ability to enhance freedom and opportunities worldwide by empowering creators with greater ownership and control over their content and networks. Blockchain is a groundbreaking technology that allows people to share information directly in a peer-to-peer manner and brings various use cases that benefit from the efficiency, transparency, and accessibility of Blockchain. In the on-chain world, transparency and trust are built into the decentralized protocols themselves, and these protections will only strengthen as technology evolves. Therefore, lawmakers and regulators focused on social media should concentrate their efforts on centralized participants that require additional transparency and information disclosure.