The crypto world likes to think in big concepts: Web3, DeFi, DePin, DeSci — decentralization seems to be bypassing no sphere. So it’s no surprise that they want to transfer social networks to blockchain. The name of this process is SocialFi.

SocialFi (Social Finance) is a hybrid of social media and decentralized finance (DeFi). The blockchain is supposed to give users more control over their own content and personal data, as SocialFi has no centralized authority to moderate or censor content or collect information about users.

The segment is not called DeSocial (decentralized social networks), but SocialFi (social networks + DeFi). That is, the point is not just to make blockchain and social networks friends, but to monetize them using DeFi tools. Accordingly, the monetary component plays a decisive role.

Monetization on SocialFi

There are plenty of ways to monetize in the world of cryptocurrencies. Therefore, in SocialFi, you can’t complain about the lack of ways to earn money. Moreover, Web3, as a rule, is also associated with complex systems of economic incentives, so SocialFi can be a deeply developed system where each participant can find their niche and income.

SocialFi Tokenomics

There is a huge scope for tokenizing interactions between participants in social networks. SocialFi uses so-called “social tokens.” These are utility tokens that are used in SocialFi ecosystems and applications.

In principle, the idea is not new. In the world of DeFi, as well as in GameFi, we often see utility tokens that are used to create an economic ecosystem within applications. SocialFi takes it a step further – social tokens do not only exist at the application level, but can also be created at the user level. That is, creators can now develop their own small economies through social tokens.

For example, any celebrity or even an ordinary user can create their own token and a mini-economy that functions around it. The value of the token will be directly proportional to the social influence of the user. Thus, a token from, for example, Elon Musk will be valued higher than the token of an ordinary user, simply created your profile on social networks.

Here is an example of how Maybe work social tokenomics:

  • Only those who have a social token from the author can interact with their publications. That is, to have access to the content, you need to buy and have the necessary token in your wallet.

  • If a user wants to attract the author’s attention, their post will be at the top of the comments when they have the highest number of Author Social Tokens among other commenters.

  • Authors can set thresholds that will allow subscribers with a certain number of social tokens to send them messages directly.

  • Content makers with a large following can create a subscription model in their social token for those who would like to have premium access to their content.

  • When a user wants to interact with someone’s content, either through liking or reposting, it costs them money.

So, in essence, tokenomics in SocialFi can take many different forms, depending on how users decide to structure it, allowing for a highly customizable platform for social interactions.

NFT

Non-fungible tokens (NFTs) can also play a key role in digital property rights identification and management, allowing creators to make their online presence more verifiable and manage their intellectual property more effectively, for example by selling their works or receiving royalties.

SocialFi, by the way, can give a second chance to digital art, which after its boom in 2021 has lost a lot in capitalization and popularity. Moreover, in the world of SocialFi, NFTs can find new ways of their application, since from the very beginning of the history of NFTs it was clear that the potential of this technology is much higher than the then and even current ways of its use.

DAO

The DAO is responsible for managing the SocialFi platforms and ensuring that no centralized authority controls user activity on the networks. The DAO is also not allowed to allow developers or others to change the source code of the SocialFi platforms. This means that every decision, including the distribution of economic incentives, is entirely up to the DAO.

On the other hand, the right to participate in the DAO is also monetizable. Voting rights in the decentralized organization responsible for the large SocialFi platform can be very expensive.

The Most Expensive SocialFi Tokens

This actually brings us to the original question: which SocialFi tokens are the largest by market cap. Even though SocialFi is a relatively new concept, there are already projects with multi-million dollar market caps. Here are the most successful of them.

Theta Network

Theta is a purpose-built decentralized network for video content. The platform provides both technical and economic solutions to the problems facing the streaming sector.

The Theta Network consists of two interdependent subsystems: Theta Edge Network and Theta Blockchain. The Edge Network provides massive GPU computing power for AI, video, rendering, and other tasks, while the Theta Blockchain provides payment, rewards, and smart contract capabilities.

Theta Network operates on two tokens, THETA and TFUEL. Theta Token (THETA) is the governance token of the Theta Protocol. THETA is used for staking and governance of the Theta Network Protocol. THETA issuance is fixed at 1 billion and will never increase.

Staking THETA and participating in governance allows you to earn TFUEL. Theta Fuel (TFUEL) is the operational token of the Theta protocol. TFUEL is used for on-chain operations such as payments for computing power, video encoding/transcoding, 3D rendering, and for deployments and interaction with smart contracts.

The Theta Network blockchain architecture allows for the creation of decentralized layers of applications that perform specific functions, such as peer-to-peer streaming, live broadcasts, video courses, conferences, television, movies, and more.

Theta’s market capitalization is $1.52 billion, making it the most expensive SocialFi project so far.

Galxe

Galxe is a decentralized platform that provides identity and reputation solutions for Web3. It allows users to manage their credentials, reputation, and achievements in the Web3 ecosystem.

Galxe uses blockchain to store and verify credentials while ensuring their security. This allows users to have full control over their digital identity and reputation, and share them with others in a secure way.

The project’s capitalization is $430 million.

Mask Network

Mask offers a decentralized option for Web 2.0 functions. The project’s creators intend for its users to will be able to enjoy secure, decentralized messaging, payments and file sharing.

That is, Mask offers a smooth and convenient transition from familiar Web 2.0 things to their decentralized counterparts.

Project capitalization is $248 million.

RSS3

RSS3 is an open-source, decentralized protocol that allows for the consumption, creation, and management of decentralized information feeds. It is designed as a more flexible and extensible alternative to the traditional RSS (Really Simple Syndication) protocol, which is widely is used to distribute web content such as blog posts, news articles, and podcasts.

RSS3 offers a range of features and tools for creating, managing, and subscribing to decentralized information channels, including the ability to create and customize your own channels, find and subscribe to other users’ channels, and interact with channels using decentralized applications (dApps) and smart contracts.

RSS3’s market capitalization is $168 million.

Decentralized Social

Decentralized Social (DESO) is a decentralized social network built on the blockchain. It is designed to be a more open, transparent, and censorship-resistant alternative to traditional centralized social networks.

DESO offers users a range of features and tools to create, manage and consume content, including the ability to create and customize their own profiles, publish and share text, images and videos, follow and interact with other users, and earn rewards for their activity.

The project capitalization is $150 million.

Conclusion

Overall, it is not yet possible to say that the SocialFi market is very developed. The ideas behind SocialFi are very interesting and could potentially change our understanding of social interaction on the Internet. But current and future projects still have some way to go before that happens.

On the other hand, it is not a fact that this path will be long. If, for example, the same TON follows the path of the closest and most effective integration with the Telegram messenger, or large social networks begin to tokenize, then SocialFi will be able to enter the mainstream very quickly.