Social protocol Farcaster user activity declines, third quarter revenue drops 70% compared to previo
Farcaster, a decentralized social protocol that was once seen as a "Twitter killer," is currently experiencing a decline in revenue. According to Dune Analytics panel data produced by @ pixelhack, Farcaster's revenue in October only reached nearly $16000, and daily income is sluggish, with only a few days reaching four figures.
Farcaster's cumulative agreement revenue exceeded $2 million on July 1st, but then began to slow down. The total agreement revenue for the third quarter was about $320000, a decrease of 70% from the $1.12 million in the second quarter.
The user activity of Farcaster has also declined since reaching its peak at the end of June, with the number of daily active users dropping from the peak of 71000 to approximately 33000.
Farcaster is a decentralized social protocol built on top of Ethereum, founded by former Coinbase employees Dan Romero and Varun Srinivasan in 2020. It has received investments of over $180 million from companies such as Paradigm Ventures, a16z, and Haun Ventures.
Farcaster, which gives users more control over their data and allows developers to expand the platform through a Mini App called "Frames," has become a hot topic in the Web3 field this year. The main client of Farcaster is the social application Warpcast, developed by the Farcaster team. It adopts a design similar to current community platforms such as X, allowing users to write posts (casts) and perform other functions such as minting NFTs and applying for tokens.
Some members of the crypto community are discussing the reasons for the decline in Farcaster's development. X user @ TropicVibes said that it is difficult to "create a better old mousetrap" and make a profit. If alternative options only bring minor improvements, people will stick to using things they are familiar with.
@TropicVibes continues to point out, "People think it's like X, so why not use X instead? I love web3 like everyone else, but developers overestimate people's willingness to change
Another X user, @ justz_ eth, shared two main reasons why he doesn't switch to other social media platforms like Farcaster. One is that many global leaders and influential people are using X, such as presidents, CEOs of big companies like Elon Musk, and think tanks. Secondly, he has already accumulated a certain amount of content on X and does not want to rebuild his achievements and popularity on other platforms.
Although @ justzputting acknowledges the benefits of decentralized relaying, such as resistance to censorship, it believes that the most likely way for new community platforms to succeed is to target the new generation of users who have not yet accumulated much content online and are willing to explore the benefits of emerging platforms. Another possibility is that a catastrophic event on X platform could trigger a large-scale migration to other platforms, and token incentives alone are not enough to facilitate this transformation.
data source
