Why Crypto Social Media Failed: A Lesson in Tech and Trends

Crypto has been trying to break into social media, but it just isn't working. Farcaster, a decentralized social network, tried to challenge big platforms like Facebook and Twitter. It wanted to give users control over their data and identity. But despite having a billion-dollar valuation and some big backers, Farcaster didn't attract many real users. Most of its "audience" was just bots, and a small group of venture capitalists cheering it on. Eventually, the founders admitted defeat. They announced a "sale" of the protocol to a third party, which was really just a way to save face. Dan Romero, one of the founders, even said he would return the $180 million he raised to investors. That's a big deal and shows how seriously he took the failure.So, why did Farcaster fail? Some people blame the management team, but that might not be the whole story. The bigger issue is that people just don't want to use crypto for social media. They'd rather stick to platforms like Twitter, TikTok, or Reddit. These platforms have millions of users and are much easier to use than crypto startups can offer. There's also a bigger problem: blockchain technology might not be suited for social media or other applications beyond finance. Crypto has had success with Bitcoin, stablecoins, and DeFi, all of which are financial tools. But using blockchain to transform industries like media or supply chains is still a distant dream. Farcaster might be a symbol of an earlier era in crypto, one that was all about data ownership. But as one observer noted, that era might be over. Crypto seems to be better suited for internet capital markets than for social media or other applications.