The innovation cycle is accelerating on DeSo, and it’s been an exciting few months, so founder Nader Al-Naji decided to create a video update to review.
The topics of the video are:
- Reminder: DeSo and our mission
- Recap of the last ~2 months
- Our focus areas for the next quarter
- What we can improve on
It’s an hour-long; if you have time, give it a watch.
If you don’t have time to watch the full video, all the important points are highlighted below.
DeSo and Our Mission
As we continue our efforts to improve marketing, awareness, and communications, we want to reiterate the DeSo mission and the value we bring to the blockchain industry.
DeSo is not only disrupting social media, but it's also disrupting the blockchain ecosystem as a whole.
Innovation and network effects compound as more founders join the network to hire developers to build apps, drawing in more people to use those apps.
DeSo network effects have a much higher upside than other layer-1 blockchains because there are more ways to create value on-chain.
Additionally, because you can do more than just financial transactions, such as creating and storing content on-chain, it amplifies network effects to another level that wasn't possible before we built DeSo.
As far as the hard tech goes, there is no other blockchain like us on the market right now, and it will take a long time for others to catch up.
Today layer-1 blockchains are building the infrastructure to support the next Visa, PayPal, or NYSE.
DeSo is building the infrastructure to support the next Facebook, Twitter, Tiktok, Instagram, and marketplaces at scale.
To build and scale web3 social media applications to billions of users, you need a layer-1 blockchain designed for infinite-state applications instead of finite-state applications.
What are finite-state applications?
Today, all the leading blockchains are built to support finite-state applications. They are great for DeFi and other financial applications where you really only need to store two account balances.
However, they can't scale decentralized social media apps to billions of users because they cost too much to store data and don't have the capacity to handle all the content.
For example, storing 200 characters on any smart contract blockchain can cost upwards of $0.25+, including Solana, Avalanche, and Polygon, however, it is virtually free on DeSo.
If you send money to someone on Ethereum, there isn't a need to increase storage or change the state of the blockchain.
You just need to know what the balance was before in each wallet and what the balance is after the transaction is complete.
You can think of finite-state applications as storage light applications.
What are infinite-state applications?
Infinite-state apps need increasing storage capacity as more people join the network, create content, and engage in other social activities such as liking, following, reposting, etc.
Powering social applications requires us to create a new "state." In other words, the data needed to power infinite-state applications like social media is much different than the data required to power finite-state applications like DeFi.
You can think of infinite-state applications as storage heavy applications.
And infinite-state = infinite possibilities.
All content is 100% open-source and 100% stored on-chain, unlocking the innovation and competition that social media is currently missing.
DeSo has the upside of becoming the identity layer of not only web3 but the entire internet.
Why infinite-state applications are important
Today, only a few companies control most of the information on the Internet. But unfortunately, that means they can control and influence what we see, which profoundly impacts our daily lives positively and negatively.
Storing content on-chain moves us from that centralized world to a place where anyone can:
- Build their own feed algorithm
- Launch a social app with no cold-start problem
- Own their social graph
- Own their content
Developers can build on an open moat of data while creators can earn up front, as opposed to after building a substantial audience.
This means you can have thousands of apps to choose from instead of just the few we have right now. DeSo brings innovation and competition to social media the same way Bitcoin and Ethereum did for legacy finance.
Bitcoin knocked the door down and changed how we think about finance forever.
Ethereum eventually sparked more innovation in finance in its seven years than in the previous 50 years combined.
Bringing innovation and competition to social media opens up a new realm of possibilities no one thought possible. Before, we only had a few choices.
With DeSo, the choices and possibilities are now endless.
Recap of The Last 2 Months
DAODAOs successful launch
It's hard to believe what we've accomplished in two short months since we posted the last DeSo Foundation update video.
If DAODAO were a web2 application, it would have taken years to ship.
However, we shipped DAODAO in roughly four months.
And if you look at the history of blockchain, nothing else launched with this level of complexity in such a short amount of time. Uniswap on Ethereum is comparable, but even that took much longer to launch than DAODAO.
And we think many additional DeSo and DAODAO updates in the pipeline will change the blockchain industry for the better.
DAODAO is our first app launch since launching our prototype application, Bitclout – DAODAO is the result of everything we learned about Bitclout but much more refined and efficient.
DAODAO makes raising money from the internet easy and more efficient.
You can raise money from anyone worldwide for your next big idea in just a few clicks. It's more of a web3 social platform than anything else that has money native features you can build and scale a community around. We like to say, imagine Kickstarter + Reddit + Coinbase.
One of the most incredible things about DAODAO is the full on-chain noncustodial order-book exchange, called DAOSwap, thanks to DeSo's ability to power infinite-state applications.
And the best thing about it is that it all happens on-chain. All the orders are on-chain, and they execute very fast and efficiently.
DAO coins/social ERC20 standard
It's worth mentioning that DAO coins and social ERC20 standards are interchangeable terms. When we say DAO coins, we mean social ERC20 tokens.
Everything you trade on the order book on DAODAO has a social component.
DAO coins, for example, have a profile picture, a description, hero image, and a feed.
Only on DeSo can you attach social information to your coin because of its ability to power storage heavy or infinite-state applications.
Imagine if you merged ENS with content, social graphs and your on-chain identity.
On DeSo, the effects of innovation compounding are amplified because of the social components of everything we do.
Everything you do on DeSo is inherently social. On DAODAO, for example, you can see the order book and active traders.
It also shows how much volume they generate and how much they want to fill. You can even DM anyone with a large holding and maybe do an OTC deal or ask them what they like about the DAO.
Over time, everything compounds to come together and create better products than you can have on a finite-state blockchain where you can't have a profile or these social aspects.
The best part is that any app can utilize all this data and information. If you want to build a better exchange UI than DAODAO, you can do that. Everything is open and on-chain.
Hypersync is a revolutionary new blockchain upgrade that reduces the syncing time for DeSo nodes from 8 hours to 20 minutes.
Before, DeSo nodes would download the entire history of the blockchain. Instead, it now just downloads the current state of all the nodes. It can be done in a sharded way which is highly efficient.
If you don't know much about Hypersync yet, we highly suggest you watch the video discussion between the creator Piotr Nojszewski, and DeSo engineer Ty Fischer.
The complexity of Hypersync is comparable to the Ethereum purge, which comes after the merge, which doesn't happen until 2023.
It's the most advanced syncing mechanism in the blockchain ecosystem and we shipped it faster than comparable upgrades on other layer-1s.
It's truly state-of-the-art technology.
Derived keys and spending limits
With MetaMask, you have to approve every transaction that happens. Unfortunately, this doesn't work for social applications because it causes too much friction and hurts the user experience.
To create a social application on a layer-1 blockchain, you need to allow people to do lower-value things such as like, follow, or repost something.
With derived keys, you can auto-approve certain transactions and transaction types and the number of times you'd like an app to perform them using derived keys.
An example scenario is giving a key permission to do social things such as like posts but not allowing it to spend money on your behalf.
An app can create a derived key to get your approval for basic things like posting but remove the risk of it taking your money. If you want to cut the app, you just cut off permissions.
It's hard to imagine web3 apps being competitive without something like this. But, of course, this has to be done at the layer-1 level to do this, and it has to be able to handle infinite-state applications.
Once you install the library, you can do everything in web3 with web2 tools, such as build an app like DAODAO, without learning smart contracts.
All you have to do is put four lines into your app, and it works: posts, NFTs, DAO Coins, and order book exchange transactions with just web2 APIs.
MetaMask integration will also go live in the next couple of weeks.
People who have MetaMask wallets, can now log in and use any DeSo app instead of just using the DeSo native wallet.
What does MetaMask integration allow?
It creates a bridge for millions of users to enter the DeSo ecosystem with just a few clicks.
MetaMask integration easily enables potential integrations with OpenSea, Rarible, and other NFT platforms.
You never even have to see DeSo, but you will be contributing content to the DeSo chain regardless.
When you log in with MetaMask we know if you have an ENS identity, pull it onto DeSo, and can pre-populate your profile on DeSo.
You can use DeSo as your identity layer on ETH with one click.
We think DeSo, with this MetaMask integration, can become the identity layer for all blockchains, not just DeSo.
This includes ETH, Solana, and other layer-1s as well.
All of this is only possible with derived keys and spending limits which you can only do if you control the layer-1 and focus on storage-heavy applications/infinite-state applications.
Otherwise, you couldn't do delegation of keys to have an integration like this.
Improved wallet onboarding
Onboarding on DAODAO is an excellent example of one of the best setups out there right now. It's using the latest and greatest that DeSo Identity has to offer.
Any app that embeds the DeSo Identity iframe can also get free starter DeSo for their users by simply entering their phone number. This small amount of DeSo is good for thousands of on-chain transactions.
You can also get free DeSo for having ETH in your MetaMask wallet.
For the native DeSo wallet where you have to get started, it's as easy as creating an IG account. With DAODAO, 95% of people enter their phone numbers and get their DeSo.
It's a very, very smooth flow for anyone who wants to start building a web3 app – All you have to do is drop those four lines of code, pass a flag, and people can get free DeSo when joining your app.
Another excellent example of the above in action is Desofy, a third-party web3 native mobile app.
If you want to try one of the best web3 mobile experiences in social media, try Desofy.app.
With Desofy, everything you do is on-chain, and your posts show up on every other app on DeSo, so you can get reposts and diamonds (tips).
Our Upcoming Focus
Proof-of-Stake is one of our highest priorities, and we think it will be incredible. We ran a full survey of every proof-of-stake proposal out there, including ETH 2, Tendermint, Solana, etc.
We have some opinions on what can be improved and we’ve incorporated all the findings into a final design with many state-of-the-art twists that will push the entire blockchain industry forward.
As a reminder, we are technologists at DeSo. One of our most significant advantages is the hard tech and the ability to push boundaries and disrupt two industries simultaneously – Blockchain and Social Media.
Once our draft is finalized, we will get feedback from top crypto researchers such as teams at Andressen and other funds specializing in proof-of-stake consensus mechanisms.
Then we will publish our proof-of-stake proposal!
August is our target date, but we will let the community know if anything changes.
ERC20 bridge on DeSo
This update is most beneficial for USDC and DAODAO is the first to support this.
You'll be able to move USDC onto DeSo (onto a DeSo native wrapped USDC), which means you can transact with 0 gas which will be useful for DAODAO to support primary fundraising rounds where your treasury is USD rather than DeSo.
Why is it valuable?
Imagine if you want to raise money to buy the Constitution, which happened. They had a lot of trouble with the volatility of Ethereum as the price went up and down.
It limited how aggressive they could be with the bid because they had to deal with that volatility, including gas fees.
If they raised with USD backing, it would have allowed them to go all the way up to their maximum bid, and maybe they would have won if they did that.
A USD treasury on DAODAO will be fascinating, and all apps can use wrapped USDC to do whatever they want.
DAODAO and other apps can expose it to the user to just USD to make it simple and not get into the complications of wrapping.
It's valuable because you can fundraise with a stable currency, allowing you to quickly cash out your DAO coins and trade in and out of positions.
As we get DeSo listed on more exchanges, it won't matter as much because we'll have more avenues for liquidity. However, USDC makes it super easy for people to transfer in and out, which will result in net inflows into DAODAO and DeSo.
The strategy behind the wrapped USDC treasury
When you allow primary sales on DAODAO to use USDC, that gets a lot more people to want to use DAODAO. Established DAOs say this is the killer feature and would move today if we had it.
Even though USD can be what people fundraise with on DAODAO, DeSo will remain the dominant base pair on the exchange.
The result of adding USD treasury on DAODAO and DeSo is we think there will be more DeSo activity on the trading side and also locked up in orders on the exchange.
Overall, it increases DeSo activity and generates fees for the DeSo blockchain.
Best in class long-form DeSo client
We're missing a lot of thought leadership on DeSo because all the apps are optimized for short-form content.
We think a Medium competitor on DeSo is exciting, significant for the ecosystem, and much needed. As a result, a lot of people in crypto will gravitate toward it.
Our approach is to either work to iterate with ones already established in the ecosystem or to launch our own.
It's entirely dependent on how fast the ecosystem moves.
In a few months, there will be a very exciting long-form play on DeSo.
All the elements already exist on DAODAO for a discord killer and we're in the process of fine-tuning it alongside DeSo Messenger.
DeSo supports on-chain encrypted and unencrypted group chat. However, it's essential to mention it's the first of its kind. No other blockchain supports that because DeSo is the only one that can support infinite-state apps.
And we think DAODAO can be the killer implementation in this equation. The highest engagement page is the trading page, but the feed is the next highest.
And it's on par with what Discord has today.
The first step is to create a global group chat on DAODAO, which we already know that's what people want based on behavior and feedback from the community.
This will work across DAOs, and will enable DAO-coin gated access to group chats.
And because we're DeSo, you can tip and receive money if people like your messages instead of just likes and stickers.
External DAO pipeline
It’s vital for DAODAO to grow on both sides of the platform. We have both DAO creators who attract DAO members. We recently hired someone whose focus will be to create external pipelines with investment funds in order to increase distribution of new DAOs being created on the platform.
We are having lots of conversations with founders of DAOs about bringing them over, so expect to see A LOT of activity from DAODAO pipeline efforts in the next couple of months.
PokeDAO: Our first collectible DAO
There will be a lot of external activity regarding raising awareness and bringing people over to DAODAO.
But we think the real unlock for DAODAO and the entire DAO space, in general, is showing people the possible patterns with a tool like DAODAO.
By patterns, we mean how to plan, launch, build, and scale a DAO. This will help people focus on their next big idea instead of how to launch and manage it. If they have a playbook, it will be easy for them to make it work.
The first pattern is a collectible DAO. Which we will experiment with by launching PokeDAO.
This pattern to launch PokeDAO will include raising money, buying cards, minting those cards as NFTs, and sending those physical cards to the winners of the auction and then repeating essentially.
What makes this so cool?
Every time the NFTs change hands, the DAO earns a royalty and subsequent sales afterward. If we keep repeating this step, we can make DeSo NFTs the dominant place to transact for ALL collectible items.
For example, pokemon cards for PokeDAO, but you could also use the same playbook for baseball cards or Magic The Gathering cards.
We want to inspire people with what we're doing with PokeDAO.
Here are some other DAO patterns we want to launch to inspire people.
A media DAO is where you raise money to create a series, movie, or something along those lines— currently chatting with CAA to see how to best approach this.
A game DAO is where you launch a demo of a game, or a concept, raise money, make the game, and distribute it back.
There's also a lot of interest in VC DAOs, Company DAOs, and SPAC DAOs.
To make this easier on everyone, we are working on a legal framework anyone can use to merge their traditional structure with a DAODAO fundraise.
We have to be thoughtful about this part to help people tap into the trillions of market cap in legacy finance and crypto.
Luckily for DAO founders, Nader's experience spending $10 million on lawyers from his previous company, Basis, allowed him to better understand the regulatory side of crypto.
And even with DAODAO, Nader and team spend a lot of time on the legal side to ensure everything is fully compliant. Not many other teams in the world have the expertise needed to push a product like DAODAO and stay within the legal guidelines.
Anything else regarding DAODAO?
We believe the future of early-stage is DAODAO – it’s so much more efficient and allows you to invest with any currency while allowing you to get liquidity immediately from what you contribute.
The skies are the limit once we crack the patterns for launching DAOs and establish a battle-tested legal framework.
Other DeSo Updates
We are close to hiring a COO in the next couple of months. The purpose of a COO is to scale the non-technical side of DeSo. We need someone to scale up our non-technical operations, set forth a strategy and improve our efforts on the marketing front.
DeSo website redesign
We are working on a killer design that is more reflective of the quality of our product. The website design will include clear marketing funnels and CTAs to help drive awareness and DAUs to the many apps in the DeSo ecosystem.
It will also help people better understand the mission and vision of DeSo. We're building a massive marketing funnel, and the website is a vital part of this equation to maximize awareness, investors, and DAUs.
Once it's live, we will redirect to deso.com
NFT bidding with any ERC20/DAO Coin
You will soon be able to bid on NFTs with any DAO Coin or use USD to bid on DeSo NFTs.
Email my followers
We've received feedback that people want to be able to make a post and email their followers so people can subscribe/unsubscribe on-chain. So whenever you post, you'll soon be able to have your audience opt into email notifications.
More exchange listings
It's still a major priority to get on other exchange listings. Binance is a priority, and we're trying to move quickly. We will update you as we get more information as to when.
What can we do better?
We have underinvested in the non-technical side of things like marketing, business development, and partnerships. We will continue to make marketing improvements.
However, most major changes will happen once the COO is hired. We're nowhere near where we will be once we execute our complete marketing strategy.
We have a lot of big plans but again, we want the COO in place and the website finalized before ramping up major marketing initiatives.
$DESOs Place in The Blockchain Ecosystem
With the integration of MetaMask and the potential partnerships with NFT platforms, DeSo can become the identity layer of crypto.
As crypto grows, DeSo can become the identity layer of the world.
How does this happen?
It all starts with getting one killer app that's viral and retentive.
When someone joins DeSo, they have more than just wallet balance, so there's more stickiness there and more value for developers to unlock.
For example, they have their profile and their identity layer on it.
One viral retentive app brings lots of wallets, users, and content on-chain, enticing developers to build on DeSo and launch more apps that bring more users in a virtuous cycle.
Any layer-1 blockchain will pursue this strategy.
DeSo is special because it can expand the scope of what people think about a crypto network.
While other blockchains can enable the next Visa, DeSo can enable the next Facebook, Amazon, etc.
So much is gained by having those as the identity layer of crypto. Everything mentioned in this post adds up to an incredibly valuable network.
The best way to prepare for the next bull cycle is to ask yourself what the market will look for when all the craziness is over, and it turns around?
We believe the next cycle will be focused on infinite-state apps and blockchains like DeSo.