Increased Innovation in Decentralized Social Media Space Driven by Ownership Uncertainty of Traditional Platforms | Rothwell, Figg, Ernst & Manbeck, PC

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In light of Elon Musk’s recent offer to buy Twitter, Inc. (“Twitter”), there has been a resurgence in the desire to develop decentralized social media platforms. In order to avoid being at the mercy of a single company or individual, the promise of user autonomy and control in a decentralized social network has spurred recent developments in the space.

What is a Decentralized Social Network?

Decentralized social networks are not a new concept. A decentralized social network, unlike its traditional centralized counterpart, runs on several independent distributed servers rather than one centralized server. This difference results in decentralized social networks operating in fundamentally different ways from centralized social networks, especially in aspects concerning user autonomy and control. On the one hand, decentralized social networks are not controlled by a single individual or entity. On the other hand, traditional and centralized social networks belong to a single entity or a single individual who possesses the ability to unilaterally control and make changes to the entire network.

As a result, decentralized social networks are more resistant to censorship and give users better control over their personal data and content. For example, many decentralized social media platforms allow participants to directly monetize their content by paying participants based on positive interactions from other network users. For example, the likes an individual receives on a post may correspond to the amount of money they earn from that post.

Decentralized social networks represent a small part of Web3 technologies. Web3 follows on from previous iterations of the World Wide Web: Web1 and Web2. Web1 was the first iteration of the World Wide Web and focused on delivering content to end users and largely consisted of static web pages. Web2, the current iteration of the World Wide Web, incorporated more end-user created content allowing for greater interaction and collaboration, resulting in a more social Internet. Web3, often considered the rising iteration of the World Wide Web, is a version of the World Wide Web that is implemented on decentralized blockchains. Web3 represents a change from the traditional centralized environment used in Web1 and Web2 and adopts a decentralized peer-to-peer structure instead. This decentralized setup allows users to fully own and control their digital identities by giving them the power to decide how and when their data is used.

RECENT DEVELOPMENTS

Aave, a decentralized financial lending platform, is one of the newest innovators in this space. Last month, Aave announced that it was going live with its Lens protocol and included around 50 apps that debuted with the platform. The Lens protocol is a social graph providing an underlying protocol on which to build social applications. Instead of using emails and usernames like traditional social media platforms, the Lens Protocol leverages cryptographic addresses and non-fungible tokens (NFTs) to authenticate users and facilitate monetization. Stani Kulechov, founder of Aave, expresses Lens’ protocol vision by stating that “[o]Ownership not only of the content you create online, but also of your profile and social network is long overdue. Lens’ goal is to empower users. »

A few weeks ago, Twitter’s own decentralized social networking project, Blue sky, published its “Authenticated Data eXperiment” (ADX) protocol code in a blog post. The blog post is titled “Working in Public” to signify that BlueSky developers want the development process to be transparent and accessible to the public. ADX is still a work in progress, but the fundamental goal is to leverage self-authentication data to create portability between different ADX services. This feature would allow a user to switch hosting providers while transferring data created on one ADX service to another. The result would be a larger and more interconnected network.

DeSo, short for “decentralized social”, is another decentralized social network with major developments in recent times. Recently, DeSo surpassed 67.5 million transactions in just over 14 months since its inception, a feat that took Ethereum, a blockchain-based platform funded by the Ethereum Foundation, just over 26.3 months old. DeSo users have a “DeSo” identity which is a portable profile that transfers across multiple DeSo applications. DeSo enables anyone to build and operate a decentralized social media platform within the DeSo ecosystem. The multiplicity of social media platforms in the DeSo ecosystem gives users the ability to choose which social media platforms they interact with. In this way, users of the DeSo ecosystem have the power to control the type of content they receive, often by choosing to participate in social media applications that do not derive revenue from advertisements.

The shift to decentralized social media platforms creates an environment conducive to innovation, which drives pioneers in this space to seek out and obtain patents on new technologies. For example, quite recently a patent covering blockchain-based content engagement platforms was delivered to Artema Labs, Inc., a blockchain-based Web3 startup located in Venice, California. Another one patent application in progress filed by an individual inventor and published in 2020 teaches “a system, method and apparatus for an online content platform and associated cryptocurrency”. As this space expands, there will likely be an increase in similar patent filings.

The emergence of decentralized social media networks also signals an emerging litigation question: who should be held accountable for the content of these networks? A class action filed in the Southern District of California on May 2, 2022 compares decentralized autonomous organizations (DAOs) similar to the decentralized networks discussed in this article as akin to traditional general partnerships in which each member is personally responsible for the acts and obligations of the network. Because the law remains unclear who will be held accountable in these networks, the outcome of this case and other emerging litigation in this space will have a major impact on the future of decentralized social networks.

The future of decentralized social networks

Decentralized social networks hold the potential for a major paradigm shift for social media platforms. However, the growth of these networks is largely dependent on the widespread adoption of Web3, the next decentralized iteration of the Internet. While the major social media platforms are unlikely to lose mass followers to their decentralized analogues anytime soon, it’s worth watching this space as concerns about ownership and control rise on these traditional platforms.

Here are the official posts on recent developments for your reference: Goal protocol launch | Bluesky ADX Protocol | DeSo press release |

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