SocialFi, a concept promising to revolutionize social media by empowering users with control over their data and monetization, has struggled to gain traction in India. Despite the $200+ billion social media advertising market, dominated by Meta, SocialFi platforms like Friend.tech have failed to attract and retain mainstream users, leading to dwindling daily active users. The primary challenges hindering SocialFi’s growth are technical hurdles related to blockchain infrastructure, which struggles to handle the high-throughput demands of social networking. Ethereum’s limited transactions per second (TPS) and volatile gas fees present significant barriers to user adoption. Additionally, SocialFi platforms lack the seamless user experience perfected by Web2 giants like Meta and TikTok, leading to a high user abandonment rate within 30 days. The fragmentation of SocialFi platforms across different chains further complicates user engagement and network effects. To address these challenges, purpose-built infrastructure specifically designed for social applications is needed to enhance scalability and user experience. Transitioning to modular blockchain architecture and adopting decentralized identity systems can help create a more user-centric and interconnected SocialFi ecosystem. By overcoming these technical and user experience barriers, SocialFi has the potential to offer unique advantages over traditional social media platforms, attracting a broader user base beyond crypto enthusiasts.
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