Autor Cointelegraph By Mitch Eiven

NFTs and the Metaverse are the hottest topics in the cryptocurrency ecosystem right now, but the next big thing might just be decentralized social media. Like decentralized finance, decentralized social media platforms don’t have a centralized governing body and may, someday, provide viable alternatives to established platforms like Twitter, Instagram, Facebook and TikTok. The technology is currently evolving just beyond the embryonic stage of development.Yung Beef, or YB — who serves as content lead and community manager at Subsocial — says that centralized social media platforms are unfair to community members and content creators. “It seems pretty obvious that centralized social networks are susceptible to lots of shady stuff, with the mystery algorithms controlling what people see, people getting shadowbanned or banned outright for whatever reason, etc. And it just gets worse when you factor in that a lot of people earn their livelihood on these platforms and their food bill is totally at the whim of the central authority.”According to Subsocial, the centralized social media industry is plagued by global censorship, a lack of customization, unfair monetization, algorithm dictatorship and a monopoly on network effects. Stani Kulechov, the CEO of Aave and a decentralized social media developer, believes that content creators should have a permissionless, censorship-resistant distribution channel with their audience. He tells Magazine that “At least the people that are posting the content, creating the content, consuming it, sharing it — they would definitely benefit from decentralized social media.”Kulechov made headlines in and outside of the cryptocurrency community last summer when he hinted that crypto giant Aave was considering building “Twitter on Ethereum.”Since @jack is going to build Aave on Bitcoin, Aave should build Twitter on Ethereum— stani.v3 (?,?) (@StaniKulechov) July 17, 2021Michael Marra, founder and CEO of Entre — a social media application that runs on the DeSo blockchain — believes that decentralized social media is really about “giving the power back to the people.” According to him, one of the problems with centralized platforms is censorship, while another is monetization, but more on both of those later.How does it all work?Centralized and decentralized social media platforms both utilize some type of social graph — a model of a social network that maps everyone on a platform and how they’re related — and allow users to communicate with each other on a front-end platform. Traditional social media platforms are totally self-contained, and the host company controls the data servers. Twitter owns and controls all its content — all your content. The same is true with Instagram, Facebook, TikTok, etc. Decentralized social media platforms live on public blockchains, and for the most part, anyone, anywhere, can operate a node, access the back end, create an app and curate a feed. According to its website, “DeSo is a new layer-1 blockchain built from the ground up to scale decentralized social applications to one billion users.” The blockchain is open-source, with the code and all the data stored directly on-chain. There are over 200 apps deployed on Deso, and users who create a profile in any app can easily take that profile and their community of followers along with them to any app on the blockchain.This new category of decentralized infinite-state applications that we are exploring with DeSo is a huge and untapped market for the crypto space to disrupt.With DeSo, we can now enable so much more to live completely on-chain and become truly decentralized like never before.— DeSo (@desoprotocol) March 24, 2022Entre, short for “entrepreneur,” is a social Web3 application that runs on DeSo. On Entre, the self-employed, the traditionally employed and any other professional can post Twitter-like content and carry out business transactions. They can conduct meetings, host virtual events and hire staff members, with the app functioning like a decentralized, digitally monetizable alternative to LinkedIn, Zoom and Google Calendar — all jammed together into a single product.While Entre runs on a social blockchain, the Aave-backed Lens Protocol is deployed on Polygon. Kulechov says that Lens is ”actually a decentralized social graph.”According to Kulechov, when a user of an app on the protocol creates a profile, that profile is tokenized as an NFT. Whenever someone follows a profile, they create a relationship on-chain that can’t be arbitrarily broken by the platform or by anyone else, as those relationships are also tokenized as NFTs that can be viewed in a digital wallet like MetaMask or on the web on OpenSea.Subsocial doesn’t consider itself a decentralized social network, rather a platform for building social networks. It allows users to create profiles and customize personal “Spaces” and claims to have serverless public timelines, roles and permissions, user governance, moderation, Spaces for DAOs, and a treasury. The platform runs on the Polkadot and Kusama blockchains, and it recently built its first app, a decentralized Reddit–Medium hybrid.According to YB, Subsocial plans to remove the profiles in the future. To save space, all content uploaded onto Subsocial (pics, videos and text) is hosted on the InterPlanetary File System, with an IPFS content identifier uploaded to the blockchain. Each IPFS node is hosted by one or more people, and those node operators are in control of what they host on their servers.While developers at Lens Protocol, Entre and Subsocial build out the next generation of decentralized, Web3 social platforms and apps, other platforms such as Theta and Audius are integrating social media tools into decentralized video and audio streaming services. Theta is a peer-to-peer network operating on its own blockchain, with users sharing bandwidth to relay video to one another. On its website, YouTube co-founder Steve Chen is quoted as saying the project can bring “improved video delivery at lower costs.” Like on YouTube, brands and creators can stream content as followers comment in real time.Audius, meanwhile, is a decentralized audio streaming platform that runs on Solana and hopes to afford everyone the freedom to distribute, monetize and stream any audio content. Artists can easily upload musical clips to the platform, while fans can listen to original compositions and mixes, curate libraries, and repost, follow, like and share content. It offers the same amount of fun but without middlemen throwing trivial ads your way and then taking a hefty cut from content creators. What about the bad guys?If creators are expected to monitor their own content on a completely decentralized platform like Subsocial, how can the distribution of illegal content and disinformation be controlled? Social media moderation has been a controversial topic for years, and platforms like Facebook and Twitter haven’t always done a good job both filtering out dangerous content and maintaining a commitment to open dialogue. YB explains to Magazine that Subsocial is censorship-resistant, while Kulechov says that Lens Protocol “is built completely to be agnostic in the sense that it’s a technical solution, basically to build social media applications.” Entre’s Marra says:“If it is open, that means anything kind of goes. You can control it to some degree.”Marra believes that blockchains can be built to facilitate the community’s ability to report things. Community members, especially those with higher authority — like those with lots of followers or a good reputation — can signal that a bad actor is posting dubious content. The offender’s content should then go way down in the feed. Marra argues that blockchain verification will also prevent a lot of “this stuff,” saying “You will instantly know that this person is not legit.” According to Kulechov, moderation is all about creating choices for everyone. Lens Protocol has a common social graph where all user information is actively linked, and unlike traditional social media, that social graph is decentralized. Kulechov believes that decentralizing the social graph so that everyone has access to it provides more opportunities to moderate more humanely.This accessible interconnectivity affords developers opportunities to create algorithms focused on content moderation. It essentially puts the front ends of the protocol, the applications, into a position where they compete to offer accessibility to accurate, appropriate information. Kulechov says:“Maybe the right type of content moderation might be community-led, where the community’s site people announce themselves and moderate or select the algorithms.”Subsocial has three levels of moderation. To start, every post is made in a Space. “Think of Spaces like a subreddit, a Facebook group, a Twitter profile or a blog,” YB says. Each Space has at least one owner who can moderate its content. Also, each IPFS node is hosted by at least one community member. Those operators can control what they host on their servers. Lastly, anyone can build a front-end social application on the platform. A front end connected to one of the Subsocial blockchains can read all the content on the chain. The operator can control what is distributed on the front end.Learn the difference between moderation and censorshiphttps://t.co/zb923stv1o— Subsocial (@SubsocialChain) March 22, 2022Still, if a front-end operator and a group of bad actors were determined to disseminate misinformation or illegal content, YB says it could be shut down with an on-chain vote. “[That] would be a big deal and likely a big hassle, but it also would be pointless, as those people could just make another Space right away and continue on.” YB argues that people use the internet to coordinate violence and share illegal content all the time — it’s just hidden, which it still would be, as large social networks built on Subsocial wouldn’t show that stuff.One thing to note, however, is that centralized social media platforms with the power to shut down a creator or community with the click of a button have struggled for years to contain the distribution of illegal content and misinformation.As such, even though relying on the community to moderate itself is egalitarian and sounds good in theory, it may not prove effective in practice. Self-moderation on censorship-resistant platforms would likely require fully engaged community members. That may not always be the case in the Web3 environment, as active members of communities need to be present in significant enough numbers to monitor bad actors on any given decentralized network. For example, a recent analysis ranking community engagement in DAOs showed mixed results.How might a censorship-resistant platform respond when an extraordinarily large community goes off the rails? Considering the massive amount of disinformation that could be generated by an organized, well-funded army of bots, could a universally adopted, decentralized network moderate a community of thousands of such propagandists?Show me the money — all the moneyEquitable monetization for community members and content creators is one of the key features of the decentralized social media ecosystem. Juxtaposed against unbalanced monetization schemes in traditional social media, decentralized social earning could be a game changer for content creators and magnetize universal adoption efforts.YB tells Magazine, “Personally, I think the monetization stuff will be much more attractive to content creators than any censorship resistance. YouTube, for example, takes 45% of ad revenue, which is pretty insane.” He adds further, ”I’m really interested to see what happens with the tips. I hope we see the emergence of a micro-tipping economy, since it will be so easy. Scrolling through the timeline and see a joke that brightens your morning? Why not tip them $0.50 in a second or two?”Lens Protocol is taking a hands-off approach to monetization. “We wanted to touch monetization as little as possible and give a lot of space for our developers to come and solve that,” Kulechov says. Lens is currently building a very basic monetization function around content collection and amplification. Whenever creators post music, text, audio or video, followers can then collect that content as NFTs. There are different collection modules, and followers can mint the NFTs themselves. If those followers then amplify that content, the creator collects mirror fees, which is like monetizing a retweet on Twitter.On the DeSo blockchain, the DESO token can be used to purchase creator coins. BitClout, Diamond and CloutFeed are Twitter-like applications that allow followers who support a particular creator to invest in their coin, exponentially increasing its value. Although not recommended, the coins can be converted back to DESO and actively traded or cashed out for fiat. Entre, according to Marra, isn’t “into creator coins” and is more focused on allowing creators to earn DESO through tipping when they livestream.Entre users can also sell tickets to in-person or virtual events and charge for private one-on-one services like consulting and coaching. The app offers a Slack- and Discord-like community feature where membership fees can be charged and users can offer services like graphic design. Currently, DESO is the only cryptocurrency accepted on the app, but Marra intends to offer multiple tokens in the future.Theta has been in the monetization game for some time and offers crypto rewards for creators, fans and hosts. The platform has two tokens: THETA and TFUEL. Owners of THETA, its native token, can participate in governance and earn more THETA by staking or running a node. TFUEL is essentially a utility token for the platform and can be earned by community members for watching streams on Theta.tv or hosting Guardian and Edge Nodes. They can spend TFUEL on real-world merchandise in the TFUEL Shop or use it to buy subscriptions to paid content.Just got Presessence vol 1 up on @AudiusProject ! LFG – thanks to everyone sharing It on there Right now!I see the value in web 3 streaming services, along with NFT platforms for songs. It’s important, especially for the transition from web 2. https://t.co/55XIITyUNX pic.twitter.com/2B4YajNpkG— Domino △ (@dominosmusic) March 8, 2022Audius, meanwhile, uses its AUDIO token to help artists monetize their work and fans support them. Community members can earn AUDIO for uploads, invites, going mobile, linking social media accounts and sustaining listening streaks. Fans can send AUDIO directly to artists.Decentralized social media certainly has the potential to tip the equity and privacy scales in favor of users and content creators. It could reshape the social media industry and redefine an era of digital free speech in the Web3 era. But in order to achieve that, it may still need to find an elusive solution to content moderation, and it will need to achieve universal adoption. Thought leaders in the space have their eyes toward the future, with Kulechov saying: “Adoption is gonna be a long game, for sure. It might take years to adopt. It’s basically one application at a time.” 

Historically, Black and Brown communities have had restricted access to opportunities for generational-wealth building. Crypto offers a chance to redress that balance… but an opaque mess of laws and regulations around crypto services and a prohibition on certain wealth-generation opportunities are standing in the way of that happening. Controversial language in the United States’ recently enacted infrastructure bill may have unintentionally contributed to that cycle. The document contains broad tax-reporting language directed at “brokers.” The ambiguity of the term means it could apply to those who have nothing to do with brokerage, like miners and developers, and could also have an inequitable effect on blockchain innovators of color.According to Cleve Mesidor, founder of The National Policy Network of Women of Color in Blockchain, “The assumption was that these miners were privileged white kids in their mansions. No, we’re mining and staking. We’re developing wallets, hardware and software. This burden will not hurt Binance or Kraken. The only people you hurt are the little people.” Karen Hsu, a cybersecurity expert and crypto entrepreneur, further believes that the language in the legislation “could unintentionally block innovators of color out of the market.”Mesidor, also an author and former Barack Obama appointee, hopes to dispel the notion that blockchain innovators are predominately white men with limitless access to capital and power. She leads an annual congressional delegation to Washington of over 60 blockchain entrepreneurs and primarily meets with the Tri-Caucus (the Congressional Black Caucus, Congressional Hispanic Caucus and Congressional Asian Pacific American Caucus). Mesidor initiated the effort because she wanted these legislators to see “people who looked like them.”Delegation of Women of Color in Blockchain!How it started (2019)…How is going (2021)Commemorate Women’s History Month with a Delegation of Blockchain Industry Leaders!RSVP to Join Virtually March 3-4: https://t.co/x31vK27vgN#WOCBlockchain #womenintech pic.twitter.com/fb1UXs4adq— Cleve Mesidor (@cmesi) February 27, 2021It’s not just founders of color who are potentially blocked out of the market. Federal regulations, or a lack thereof, restrict access to a litany of innovative retail investment products. With very few exceptions, leveraged tokens, crypto lending tools and all Bitcoin spot market ETFs are not permitted in the United States.Proficient retail investors from all communities could benefit from these products, and they could be wealth-generating game changers for families and communities who have been locked out of the traditional system. Cryptocurrency legal and regulatory adviser Christine Trent Parker is uncertain what the right regulatory structure for those products would look like, but she believes that underserved communities deserve access to them and that those products should be offered in a regulated manner.“Why would you not let people [have access] who don’t have access to investment products, who don’t have a portfolio of securities that they can borrow against? It’s a great product.”Manasi Vora, vice president of Skynet Labs and founder of Women in Blockchain and Komorebi DAO, believes that underrepresented retail investors “are usually left out of amazing opportunities due to arcane laws,” like the accredited investor law.The Securities and Exchange Commission defines a retail investor as “accredited” if the individual has a gross income exceeding $200,000 or has joint income with a spouse or partner exceeding $300,000 during the past two years. Although the law was amended by Congress in 2020 to include investors with certain professional credentials, it may still be too restrictive when applied to the crypto space.Skynet ? pic.twitter.com/JGZIsmPggK— manasi ☀️? (@manasilvora) January 29, 2022Komorebi DAO invests in crypto founders from underrepresented communities. Prospective members of the collective who don’t meet accredited investor requirements can’t participate. Vora says: “With Komorebi DAO, if the law restricts us from having accredited investors as members, then that leaves them out from all the potential value of investing in crypto companies.”Back to businessesWhen Hsu first entered the space in 2016, she felt that there was a lot of idealism about how cryptocurrency and blockchain could be used to serve the unbanked. She and other members of Blockchain by Women, an organization she founded, were optimistic. Many came into the space with grand visions. They hoped to build profitable companies, and Hsu wanted to help protect crypto entrepreneurs. She started the firm BlockchainIntel to provide affordable cybersecurity services to innovators in the space, including those creating products and services for underserved communities.According to Hsu, large institutional investment firms like JPMorgan Chase entered the ecosystem a few years ago and began gobbling up the lion’s share of the wealth. Smaller firms like Hsu’s struggled to compete. She couldn’t charge sustainable rates that were comparable to those paid by the big companies. Even more challenging, her customers struggled to effectively navigate complex regulatory systems concocted by state regimes and uncertain federal regulatory agencies.Hsu soon determined that many of the guidelines currently on the books had been built around the needs of the larger, well-established cryptocurrency exchanges and deep-pocketed investment firms flooding the space. With some exceptions, these rules are exactly the same or similar to those antiquated statutes that have kept the underbanked and unbanked locked out of the system and discouraged financial innovation in communities of color. Some critics of the infrastructure bill argue that the current rules help sustain a non-level playing field where entrenched wealth and power is recirculated among those who already have it.According to Parker, every state in the U.S. has a different set of rules for businesses identified as money transmitters, a subcategory of money service businesses that cryptocurrency exchanges are categorized as. Parker says, “When you’re dealing with spot market transactions, it’s a state-by-state analysis of money transmitter licenses. [..] It’s not even one regime. It’s 50 different interpretations of what it means to be a money generator.” For example, Parker believes that setting up an appropriate LLC isn’t that hard. An innovative entrepreneur can do that. “Evaluating 50 money transmitter licenses… that’s really hard.”Mesidor believes that these multistate regulatory requirements and roadblocks at the federal level are “burdens that Black and Latinx innovators cannot comply with that will force them out of the space.” Mesidor, also an adviser to the Blockchain Association, has actively been lobbying members of Congress to embrace common-sense regulatory legislation for cryptocurrency. She believes that federal regulatory clarity will help level the playing field for entrepreneurs from underserved communities and those providing crypto services to members of those communities. What’s not being done?If the nebulous federal regulatory effort is the primary obstacle to full inclusion, why aren’t the politicians who represent underserved communities doing anything about it? Why aren’t those legislators drafting bills, introducing legislation and lobbying for change?Black & Latinx industry leaders are eager to lead discussions about financial literacy, skills training, access to capital and empowering unbanked rural, urban, native communities across America.#DiversityInBlockchain— Cleve Mesidor (@cmesi) February 8, 2022Although Mesidor believes that her delegatory efforts on The Hill have made an impact, she still feels that some caucus members don’t quite get it. Most are more focused on consumer protection than inclusion and education. An advocate for financial literacy, Mesidor believes that it would be more effective for legislators to find ways to teach their communities about the opportunities that digital assets offer:“If they were more focused on financial literacy and skills training and workforce training, that would be acceptable, but they are mostly focused on consumer protectionism.”During a hearing in December 2021 with cryptocurrency CEOs, several Democratic members of the House Financial Services Committee hammered the panel with questions about risks to retail cryptocurrency investors. Mesidor compares this hyperfocus on consumer protection to “patriarchy” and says: “Some members of Congress are so hellbent on protecting us that they simply make sure we have no options.”And the solution is…Mesidor believes that voting is the ultimate solution to the problem. She’s working to recruit crypto-friendly candidates who also support unrelated political priorities in their communities. “There is a new generation of political leaders who prioritize crypto, as well as equity and justice. My interest is in fielding new candidates of color whose agendas align with those issues.” Mesidor adds further: “Data shows that Black and Latinx communities are leading mainstream adoption, so crypto is already a growing priority issue for our communities.”Representative Alexandria Ocasio-Cortez questions cryptocurrency CEOs at a hearing. Source: C-SPANHsu believes that it’s just a matter of time — a process of political and technical evolution. She doesn’t think that unbanked and underserved communities are the primary focus of the crypto marketplace in the United States. “The United States is a wealthy country, and most cryptocurrency stakeholders are focused on acquisition, the accumulation of wealth by those with access.” Hsu believes that the process has to run its course and that, over time, the market will shift priorities.“It’s just probably going to be after what we see now, which is focusing on the acquisition use case. It’s an evolution here in the U.S. moreso — technologies are adopted by the wealthier people first […] and then onto others.”In other parts of the world, crypto’s use cases are less about acquisition and more about payments — buying everyday goods and services. Once the U.S. market shifts to the needs of its average citizens, Hsu expects comparable laws and regulations to follow.