Thanks to all those that gave their invaluable feedback. Special shoutout to Jakub and all the Social Graph Ventures members that moulded my thinking around web3 social. If you’re building in the space can’t think of a better place to go to. DMs open both on Farcaster and X.
Level 3 Platforms
In 2007, Marc Andreessen published a blog post about the three kinds of platforms on the Internet. He focused on the overwhelming advantages of “Level 3 platforms” - which allow 3rd parties to run code within the platforms themselves. The vision was to have an open source ecosystem of apps on top of Level 3 platforms, which would enable a “rapid rate of application development” as users clone and modify one another’s applications.
Almost two decades later, we have programmable public blockchains at scale - the ultimate embodiment of Level 3 platforms. Just as envisioned, having an open source ecosystem of apps (or dApps) has resulted in the rapid pace of development, experimentation and iteration that we’ve seen. On top of this, we have an interoperable identity layer and a seamless way of recording ownership and actions.
Despite the progress to date, web3 hasn’t felt like Level 3. The way in which users discover and interact with dApps remains manual and feels primitive. New projects have to rely on distribution channels that aren’t compatible with the web3 stack (e.g. Twitter), meaning their user don’t get to experience the inherent benefits - mainly composability. web3 social apps are here to change that and have recently been making strides to towards a true Level 3 platform.
Current Paradigm
The typical UX flow in web2 begins with a user navigating to another app’s website, undergoing a sign-in / conversion process and arriving at a confirmation or activity page. Taking a trivial example, when a user want to buy a concert ticket discovered on Instagram - they must click on a call-to-action, sign-up on the ticketing website, input payment details and personal data to complete their goal. Major frictions are caused during each step and research shows that over 25% of shopping cart abandonment is due to the site requiring sign-up or having complicated checkout processes.
UX flow has been no better in web3. Users discover new dApps on social media (Twitter, Discord) and navigate through various mediums, including front-ends, wallets and chains to reach their end goal. Not so long ago, the largest issue for web3 users was the “navigation” part of the flow. Transaction costs were prohibitively high and navigating chains with self custodial wallets was cumbersome. However, with the latest advancements in scaling solutions (L2s) and wallet offerings (embedded wallets), web3 navigation has come a long way and now the “discovery mediums” are causing the most frictions in distribution.
To date, the primary social network used by crypto natives is Twitter - a Level 1 platform. As defined by Marc, this is when a third-party app runs outside the platform and has no ability to inject functionality into the platform itself. This is currently the norm across social media platforms and results in a highly constrained user experience - designed to maximise in-app engagement. This inherent lack of interoperability makes web2 social platforms an outdated and incompatible medium of distribution for dApps. By relying on these platforms, crypto’s biggest advantage - composability - is being nerfed.
The Shifting Tide
Within web3, the first iteration of social apps have largely been focussed on decentralising and open-sourcing the social graph (Farcaster, Lens). Users own their data, which they can take to any application built on top. More importantly, these platforms are built ground-up with modularity and web3 in mind. Despite the strong philosophical grounding, web3 social has been a niche within the builder community and not viewed as a distribution channel for the majority of web3 projects - until now.
Web3 social is showing signs of becoming viable distribution channels to the traditional outlets we’ve been used to - particularly with the arrival of Frames on Farcaster. Frames open up interactive portals to external applications, allowing them to have direct access to the users on Farcaster. The magic is in the composability of the web3 stack, allowing these applications to leverage on-chain identity, data and money - directly from a user’s wallet.
Frames have had been wildly popular since launching in late January. DAUs rocketed to all time highs, jumping from 2k to 20k, and over 50k unique Frames have been casted, attracting 22% of all likes given out in 2024. Early March, “transactions” were announced - allowing Frames to accept payments in a matter of taps.
Since launching, there are already Frames to mint NFTs, bet on prediction markets and even buy hats. It’s still early days, but it’s clear that this experience raises the bar for a social network and often makes returning to Twitter feel clunky / outdated. The fact that Frames are limited in their functionality means apps can utilise them as superior marketing channels without sacrificing on the ability of the apps to “own users” - by directing them to their own websites, complementary to the user flow on Frames.
Although Farcaster has the most traction and development activity, they are not alone with the goal of re-defining the web3 discovery experience. Lens has it’s “Open Actions”, enabling smart contract to be embedded directly into Lens publications. “Tipping” is an early example, through which poster can include a module that direct tips to a receiver address. 0xPPL is taking an alternate approach by building a social layer around on-chain activity. In the future they plan to integrate transactional features, focused on connecting to DeFi. All in all, these web3 social platforms act as the perfect testing ground for both ephemeral and established apps.
“Web3 social is the most important final piece in the evolution of crypto, empowering users with ownership. As founders, we're not just building apps; we're crafting the future of how we interact online, leveraging the power of an interconnected ecosystem” - Prasanna (Founder 0xPPL)
It’s clear that web3 social protocols are taking a common direction by natively integrating external applications. In the near term cypto native projects will benefit the most by building extension of their protocols on these platform. In the longer term, web3 social has the potential to re-define e-commerce user journeys as we know it. Imagine your favourite artist posts a link to their upcoming concert, generating a preview card and a selection of actions. In a matter of taps, your payment is made seamlessly through an embedded wallet & ownership is transferred via NFT.
We go from what was previously 3 painful steps of navigating to a new site, signing up with your data and providing payment details to a matter of taps on a single platform. As put by agm.eth (Founder of Spindl, ex-Facebook), “the technical and multi-party coordination problems to make these user stories were insurmountable in web2”. This is the “wedge” that web3 social has, it’s composability, the ability to facilitate communication amongst various apps / protocols.
Round Up
In light of these developments, it's clear that we are on the cusp of a new era of Level 3 platforms. Web3 social apps are not just decentralizing the social graph; they are facilitating a truly open source ecosystem of dApps, fostering rapid development, experimentation, and iteration. The interoperability and composability inherent in the web3 stack are enabling these platforms and transforming the way we discover and interact with dApps. As these platforms continue to evolve and gain traction, they promise to revolutionize the distribution channels for not just crypto-native dApps, but eventually for traditional e-commerce businesses as well.