Decentralized Social Media Raises $200 Million
Is BitClout the "Facebook killer" we've been waiting for?
The big boy social media platforms are sweating.
While almost 4.5 billion people use some form of social media, the way people use it is changing. Twitter and Facebook have taken notice. Even LinkedIn recently launched a $25 million creator fund to bring more content to its platform.
While paying content creators for their work is refreshing to see, it's not enough to stop new, decentralized social media platforms from making waves in the social verse.
BitClout, a social media application built off the newly named Decentralized Social blockchain, or DeSo for short, recently made headlines.
So why did investors give BitClout $200 million, and what does it mean for the platform moving forward? Better yet, should you hop on the train before it's too late?
Let's talk about it.
Growing pains of social media
Today, the average person has 8.4 social media accounts.
I have ten. Even though I'm technically active in all of them, I use a select few every day. I use Snapchat for entertainment and LinkedIn to share written content. However, I'm less inclined to use Instagram since its algorithm isn't favorable to growth anymore.
I failed at Instagram photography. Years ago, I wasn't able to grow a meager Instagram following for my startup. I also haven't had a lot of success as a photographer either. Not only are followers tough to come by, but followers are meaningless in the end since Instagram could wipe out my account at a moment's notice.
Since algorithms dictate who sees what, only a tiny percentage of your followers will see your work anyway. I see the same people's stories and posts. And the posts I do make aren't even mine: Instagram owns them.
Why BitClout?
BitClout's goal is to take centralization out of the equation and give its users to power to make game-changing decisions for the platform. Not only that but each BitClout user is given their own social token.
BitClout changes things. Since it's such a small platform, there's a common courtesy to share your posts and help you grow as a creator. Since starting on the platform, I've gone from 0 to 130 followers in less than two months, simply repurposing my content.
Thanks to investors, my coin price has also risen to over $65 on the platform. Whenever someone invests in me, not only does my coin go up, but I receive 10% of the investment. So if someone buys $100 of my coin, I get $10.
I can pocket that $10 for myself, or I can reinvest it into my coin, other creator coins, or I can buy NFt's directly off the platform.
From a creator standpoint, it makes sense to use the platform because while you build an audience, you also make money in the form of DeSo in the process.
If you're an NFT artist, that's a whole other can of worms. You can sell directly to other BitClout users, as well as showcase the NFT's you've won on your profile.
The leader unmasked
Following the investment headlines, BitClout's leader, formerly known as Diamond Hands, unveiled himself. Nader Al-Naji, the creator of the DeSo blockchain and head of the DeSo foundation, completed his first face-to-face interview with Yahoo Finance.
He gives his take on the platform:
“But, you know, really what DeSo is, DeSo is a blockchain that powers apps like BitClout, that you mentioned, and what it is, it’s a blockchain that’s custom built from the ground up to power social applications. And so, you know, we’ve seen blockchains like Bitcoin and Ethereum power financial applications, really bring innovation there.” — Nader
The reveal excited the BitClout community. DeSo price is up over 70% in the last week since the interview.
What will DeSo do with the money?
DeSo, the project powering BitClout, received $200 million in capital from Sequoia, Social Capital, aCoinbase Ventures, and Andreessen Horowitz.
“That money is also going to be used to build the ecosystem around the DeSo blockchain and that involves everything from motivating developers to build DeSo, as well as NFT artists. So NFT is a money enabled feature that you can build off of DeSo. And Additionally, social tokens is a really big category for DeSo so as well and that capital is going to be used to build that ecosystem as well. And we're very excited about that." — Nader
Should you make a BitClout account?
Anything this new should be considered speculation.
Although I'm a part of the BitClout community, I'm not banking on it to "kill" the Facebook corporation anytime soon.
However, BitClout is exciting. As a creator, there are limitless possibilities to utilize social tokens. BitClout acts like a Twitter copycat, but other applications like CloutPub, a blogging platform in which readers pay DeSo to read stories, are being developed.
Nader says this about non-celebrities joining the platform:
These features like social tokens, like social NFTs and social tipping, that DeSo so enables for the first time by virtue of being a blockchain, are actually allowing creators, everybody from celebrities to the ordinary person, to monetize 10 to 100 times better while also creating a tighter relationship with everybody that they interact with. And even people who are not mainstream celebrities are making hundreds to thousands a week just on, like for example, the social tipping features, and it’s for everybody, not just celebrities, of course.” — Nader
Final thoughts
While BitClout has received criticism, especially for featuring accounts of celebrities who haven't signed up for the platform, $200 million isn't a number to scoff at.
Many in the crypto space believe BitClout is taking a significant step toward Web3 social media development. Even Twitter and Squarespace's Jack Dorsey said they are working on "an open developer platform" to tie in bitcoin-related services. Dorsey is likely one of many social media moguls observing BitClout.
Bluesky, Twitter's decentralized social networking effort, recently made its first significant update since 2019. With that in mind, it seems corporations are working on their own forms of decentralized social media.
Now BitClout's leader has made himself known, the coin's price is rising, and the DeSO foundation has $200 million to grow the platform.
Whether BitClout succeeds in taking the crown or fails trying, this is just the beginning of a social media revolution.
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