The Blockchain Business Model blog post established the problems of centralized social media platforms and how we're stuck in The Ads-Driven Business Model.
Social media companies are incentivized to stay closed off to founders and builders because open-sourcing threatens their revenue stream.
The ads-driven business model makes social media more centralized than legacy finance was when Bitcoin was invented, stifling competition and innovation in the process.
We highlighted a better way forwards – The Blockchain Business Model from Nader Theories' recent blog post.
This blog will dive into how antifragile blockchains are and how a single killer app is all it takes to spark innovation and mass adoption.
But what does antifragile mean?
Antifragility means thriving in the face of chaos. Crypto has a long history of thriving in the face of chaos and coming out better than before.
Throughout all the FUD, the blockchain ecosystem continues to grow and evolve, onboarding more and more users into the ecosystem. Blockchains and the communities that rally around them have done this in the face of countless hurdles, FUD, and backlash from all directions.
Some examples of FUD are hacks, regulatory fears, too centralized FUD, can't be used as a payment FUD, bear markets, and everything in between.
Because of that, they've grown more robust with each crypto hype cycle and will continue to as more founders, builders, and creators join each respective network increasing security and decentralization.
When we say blockchains are antifragile we mean that all it takes is a single killer app on an open platform that sparks the innovation needed to drive mass adoption. Once that killer app is built, it brings wallets+users+content into the ecosystem.
As more users join the network, it creates incentives for new developers to build apps on the platform. This process plays out with each new crypto hype cycle. During a hype cycle, price increases, which gets the media's attention and runs stories about all the activity in the ecosystem.
With each new cycle, innovation compounds and gets bigger each time, drawing in more new users and builders.
Innovation is simply a new idea, method, or device. The more founders, builders, and creators join the network, the more innovation compounds.
An excellent example of how this played out in the past is Ethereum. Ethereum gave any developer in the world the ability to create decentralized financial applications. MetaMask was a bridge that allowed anyone to access any app built on the Ethereum blockchain in a permissionless way.
MetaMask made it so if a single killer app was created, users had to download MetaMask to buy Ethereum and access the network. All those users would then be accessible to all other Ethereum app developers, strengthening the entire network.
A killer app did not launch on Ethereum until ICOs in 2017, which allowed startups and entrepreneurs to crowdfund without friction or trust instantly. With the ERC-20 standard, anyone in the world could define and sell a "token" representing ownership.
The ICO boom allowed entrepreneurs to raise billions of dollars to build other apps. With other apps built, more needs and use cases emerged, such as lending and yield farming which led to the need for decentralized exchanges.
This then led to the popularity of NFTs, which onboarded creators into the web3 ecosystem. Until then, most protocols and projects were tech-heavy and marketing lite. While many write off the ICO boom as speculative mania, the cycle's positive impacts on the ecosystem are clear.
Speculative mania has an organic marketing aspect to it: price action. Price action brings new users and buyers into crypto, which leads to an increase in price. These new users also create content for others to read and understand the ecosystem. That price increases awareness in the form of PR and social media.
Eventually, this becomes unsustainable, and the bubble pops. Once the bubble pops, the true believers, founders, and developers stick around to keep building new apps.
Each new cycle brings in new users, which sets the stage for an even bigger cycle in the future. That's why blockchains are antifragile. The single "killer app" for Ethereum was ICOs which sparked even more innovation and building in the ecosystem.
Each new cycle allows Ethereum founders and developers to keep building while driving mass adoption. With 200+ apps and counting, we think we're at the very beginning stages of that for DeSo, judging by the bustling app ecosystem that already exists in the ecosystem.
This cycle has played out so many times in crypto, and there's no reason to believe it won't play out again.
This time is set up for a much bigger crypto hype cycle whenever the bear market ends. While institutions dipped their toe into the crypto waters, there was still a lot of big money sitting on the sidelines. Additionally, this cycle saw countries like El Salvador legalize and add Bitcoin to their treasury.
Even the President of the US called for fellow politicians to develop a crypto plan to foster innovation and become a world leader.
Politicians are just starting to plant their flag on Bitcoin for their next campaign. If they don't have a crypto plan, they risk losing votes. In addition, big brands like Starbucks, YouTube, Disney, Walmart, Microsoft, Adidas, and more are experimenting with integrating web3 elements into their products or marketing strategies.
This creates more ways for DeSo to win because more companies will look for ways to integrate social aspects to their web3 strategy through NFT launches or a DAO.
So while we're currently in a bear market, we've seen what happens when big projects like OpenSea and USDC build during this time. As projects put their head down and build new ways for people to interact with their protocols, it sets the stage for a massive influx of users during each successive cycle.
Crypto was too techy for creators until NFTs showed up. NFTs tapped into an entirely new user base that didn't exist in crypto. Now the same is happening to social media, where people are starting to become aware that there is a problem, but they haven't discovered the solution.
However, they are starting to notice what we're building at DeSo, and there are clues of people warming up to the idea of decentralized social media everywhere.
Remember, all it takes is for a single killer app to be built to drive a big influx of users into the DeSo ecosystem, thanks to the antifragility of blockchains. A single killer app can result in a massive light bulb moment for millions of users in the same way NFTs did for people who didn't first understand crypto when it was just ICOs.