CoinTelegraph Report:
Author: Biteye Core Contributor Wilson Lee
Farcaster is a decentralized social network protocol that leverages smart contracts and hybrid storage technology to facilitate social connections, content sharing, and data ownership among users. It supports diverse and flexible client and application development.
In March this year, the memecoin project Degen within the Farcaster ecosystem gained widespread attention with a more than 20-fold increase and a market cap surpassing $1 billion, making Farcaster a focal point of interest.
In May, Farcaster’s developer, Merkle Manufactory, announced the completion of a new funding round led by Paradigm, raising a total of $150 million and valuing the company at $1 billion.
According to Dune data, Farcaster’s total user base has reached 540,000 people, with daily active users surging from 2,000 at the beginning of the year to 56,000 currently, marking a growth of over 28 times.
Farcaster is not a new social project. In its early testing phase, founder Dan utilized personal influence and relationships to onboard many well-known OGs, including Vitalik Buterin, and screened early users through Twitter DMs for invite codes, resulting in a highly “elite” user base.
This strategy of setting high entry barriers aimed to gather a highly similar user group in the early stages, making Farcaster somewhat akin to a streamlined version of Twitter, where early users enjoy higher-quality posting and interaction experiences.
Moreover, early adopters often influential KOLs themselves, possess significant social influence, potentially fostering a sense of social superiority by experiencing Farcaster early, which could drive greater motivation to discuss and promote Farcaster on other platforms.
Last October, Farcaster opened for registration but maintained a $5 entry barrier, effectively preventing a large influx of bot accounts and maintaining a positive atmosphere compared to Nostr, which suffered decline due to rampant bot activity.
To date, Farcaster has generated nearly $1.9 million in revenue through registration fees and data storage costs.
Farcaster’s two founders, Dan and Varun, previously held key positions at Coinbase, linking Farcaster closely to the Base ecosystem. Jesse, a core figure at Base Chain, is also highly active on Farcaster.
From another perspective, over 70% of the blockchain interactions among the top 500 users with the most followers on Farcaster occur on the Base chain.
Therefore, for those bullish on the Base ecosystem, Farcaster is also seen as a potential treasure trove of alpha.
Farcaster protocol data is stored in on-chain and off-chain hubs, allowing developers to choose to run hub nodes independently or utilize third-party service providers like Neynar for data access.
All this data is permissionless, enabling developers to build various clients and applications, significantly enriching the diversity and innovation space within the Farcaster ecosystem.
Users can track ecosystem progress via the decaster website, where highlights of various projects are featured.
**WrapCast**
Wrapcast, the primary application under the Farcaster protocol, is the first Farcaster client developed by a top engineering team assembled by Dan over more than a year.
Its overall architecture resembles traditional Web2 social software, providing a seamless user experience and currently occupying 90% of Farcaster protocol traffic.
The registration process for Wrapcast is simple; the system automatically generates a wallet binding for users. All Wrapcast accounts are associated with a Farcaster ID and store generated content in the Farcaster hub.
This design enables easy entry into the blockchain world even for non-crypto users, significantly lowering the cognitive barrier for new users.
For users familiar with blockchain interactions, they can also bind their preferred cryptocurrency wallets. These adjustments not only ensure user-friendliness but also play a crucial role in promoting growth and user acceptance within the Farcaster ecosystem.
**Warpcast** is designed as a social platform similar to Twitter, where users can post tweets (casts), comment, retweet, and follow other users.
In addition to Twitter-like social media functions, Warpcast also introduces features like channels and actions, creating more interactive ways of engagement.
For instance, DEGEN leverages user engagement within the Farcaster ecosystem to distribute tokens. Users can participate in DEGEN airdrops by following channels and interacting, with airdropped tokens available as rewards to give to other users.
Farcaster’s significant growth this year is closely tied to the Frames feature introduced in February. Frames are mini-applications embedded within Warpcast, enabling users to perform a variety of interactions directly within Warpcast, such as minting NFTs, subscribing to content, playing games, and earning tokens.
For example, far.cards is a collectible card project exclusive to Farcaster users developed based on mint.club. Each user’s card attributes are determined by their activity level on Farcaster, such as follower count, likes received, and replies.
Card prices are determined by a bonding curve, allowing cards to be collected or traded.
The application of far.cards in Frames within tweets allows users to directly purchase cards through the Frame without leaving the Warpcast client.
The introduction of Frames has greatly enriched Warpcast’s playability, expanding Farcaster’s development beyond just being a decentralized version of Twitter.
Currently, nearly 40,000 users are using Frames, resulting in over 150,000 on-chain transactions, with 1,624 interactive contracts designed.
Frame’s user experience is similar to Ton’s MiniApp ecosystem. While Farcaster currently lacks a large user base like Ton’s, it needs to focus on simple and easily spreadable Frame games, akin to Not a coin on Ton.
Referencing DEGEN’s success in market value and dissemination capabilities, Farcaster has the potential for projects to distribute high returns on tokens through Frame mini-programs.
Degen.Game is a site that organizes Frame mini-programs, allowing users to log in with their Farcaster identity to view and interact with the latest Frames daily.
**Jam**
Jam is a creator economy platform based on Farcaster, transforming every tweet on Warpcast into an NFT asset similar to Friend.tech Key, which users can buy and sell. Prices are determined by the Bonding Curve shown below.
Within 72 hours of launch, Jam’s trading volume exceeded $10 million.
**Conclusion**
As people increasingly embrace “living” on the internet, social graphs have become crucial personal assets, with growing demand for data sovereignty.
Web3 solutions inherently address pain points in current Web2 social platforms, yet decentralized social domains have not seen significant success.
Many projects prioritize decentralization but overlook user experience. Dan pointed out in a Bankless interview that the goal of Web3 social is not to replace Web2 but to enhance it, allowing users to own data while participating in more blockchain-based activities, achieving things Web2 cannot.
