Web2 Social Media Apps and Their Cryptocurrency Ventures

Abstract

Telegram has officially designated the TON network as its primary Web3 infrastructure blockchain and aims to join force in creating a Web3-based "super app".

Twitter has generally shown a friendly attitude towards the crypto industry, although Elon Musk does not favor blockchain-based Twitter. Nevertheless, the Web3 social app Friend.tech, built on the Twitter platform, has been gaining increasing popularity and is heralding a new era in Web3-based social interactions.

Meta has taken a proactive stance towards the blockchain industry, despite facing challenges with its stablecoin project. The company has wholeheartedly embraced the concept of the metaverse and demonstrated strong support for NFTs.

Reddit has been active in the cryptocurrency market since 2013, and its clever strategies have garnered significant attention for its Reddit NFTs.

Telegram Teams Up with TON to Propel Web3 to the Forefront of its Infrastructure

Telegram has officially designated the TON network as its primary Web3 infrastructure blockchain. As a part of this recognition, Telegram will seamlessly integrate TON into its user interface and exclusively promote it within the application. Furthermore, projects developed on the TON blockchain will receive preferential access to Telegram Ads, the platform's advertising service.

John Hyman, the Chief Investment Officer of Telegram, has expressed that the integration of TON is aimed at empowering all users with digital ownership, while also granting TON projects access to Telegram's extensive user base. Going forward, TON will remain an independent decentralized organization, while Telegram will continue to focus on its core business as an instant messaging platform.

Prior to the official announcement of TON wallet integration, Telegram had already introduced a product known as the App Center. It offers dozens of applications across various categories, all seamlessly linked to the wallet. Users could conveniently perform all operations within the Telegram app, much like the functionality of WeChat mini-programs. Additionally, according to statistics from ton.app, there are currently 551 apps within the TON ecosystem, but the majority of them are not financial DeFi products. Based on the current ecosystem layout of Telegram and TON, their primary focus does not appear to be on DeFi. Instead, their main objective is to create a popular Web3-based application, resembling a "super app" akin to WeChat.

Twitter's Near-Term Blockchain Prospect Dims, While Friend.tech Thrives on Its Foundation

Dorsey, the co-founder of Twitter, is not only a cryptocurrency enthusiast but also a staunch advocate for blockchain technology. Through his dedication, Twitter has emerged as a leading platform for global blockchain discussions. Prominent figures like Vitalik Buterin, known as 'V God' on social media, along with active crypto projects and developers, prefer to use Twitter for communication and community engagement. Twitter has also become the preferred platform for influential projects to voice their opinions. For example, major fundraising platforms like CoinList primarily rely on Twitter for their announcements.

Following Elon Musk's acquisition of Twitter, he has been actively steering the platform toward becoming a mainstream Web3 social application. One of the key initiatives he pursued was open-sourcing the Twitter algorithm, aligning with the fundamental principle of openness in the Web3 ecosystem. Furthermore, in November 2022, Twitter began testing a new feature that enables users to showcase and trade NFTs directly within their tweets.

Regarding the future development of Twitter, Elon Musk had previously explored the idea of building a blockchain-based social network with his brother, Kimbal. However, Musk found this approach too slow to support Twitter's fast-paced nature. Later, Musk directly responded in a post, asserting that a blockchain-based Twitter isn't feasible due to peer-to-peer networks being unable to meet the high bandwidth and latency requirements. According to Musk's remarks, Twitter's future development path may resemble that of WeChat. In May 2022, during a discussion on the All-In podcast with other tech leaders, Musk expressed that WeChat provides a good model for Twitter's future development.

While the idea of establishing Twitter on the blockchain may currently seem challenging, Web3 apps built on top of Twitter have gained remarkable popularity in recent times. Among them, Friend.tech stands out as a typical example. Built on the L2 network base, this product is closely integrated with Twitter, allowing it to access users' Web2 social identities. DefiLlama data reveals that Friend.tech developers have earned nearly $20 million since its August launch. As of October 6th, data from the crypto research organization Messari shows it has attracted 300,000 independent users and generates daily revenue of $320,000, six times that of OpenSea.

Facebook's Radical Metaverse Strategy

In the realm of mainstream Web2 social media firms, Facebook, now known as Meta, has embarked on an ambitious journey to transform into a metaverse platform. As the parent company of popular social media platforms such as Facebook, Instagram, WhatsApp, and Messenger, Meta boasts a global user base exceeding 3 billion. However, due to the potentially far-reaching implications, Meta's endeavors to achieve its cryptocurrency dream have encountered significant setbacks.

In 2019, the tech giant introduced a cryptocurrency known as Libra. Unlike conventional stablecoins pegged to the US dollar, Libra aimed to maintain relative stability in purchasing power as a digital currency. Initially, it was backed by a basket of low-volatility assets, including the US dollar, British pound, euro, and Japanese yen.

On June 18, 2019, Facebook unveiled the Libra whitepaper. This was followed by a House Financial Services Committee hearing over the company's digital currency on July 17. On September 13, the French Ministry of Finance announced that France and Germany had agreed to resist Facebook's Libra. Subsequently, on October 5, PayPal announced its decision to withdraw from participation in Facebook's Libra project. In October, a coalition of five European Union countries, led by France, united to oppose Libra's entry into the European market. Eventually, Facebook had no choice but to put the Libra project on hold.

Following that, Facebook renewed its commitment to the metaverse and rebranded to Meta. During the latest earnings conference, Meta's CEO Mark Zuckerberg emphasized the company's current priority of realizing the metaverse vision. Meta's goal is to reach a scale of 1 billion people in the metaverse, which has the potential to create a digital commerce market worth hundreds of billions of dollars.

In August 2022, Meta announced that the company would enable the display of NFTs on Facebook. Users would be able to connect their personal digital wallets to the app and showcase their entire collection of NFTs. Meta also extended this feature to a select group of creators and collectors, allowing them to share the NFTs they own on Instagram. Additionally, Meta supported wallet connections with Coinbase Wallet and Dapper Wallet, enabling users to display their owned NFTs from these wallets as well.

Reddit's Early Foray into Cryptocurrency and Popular Reddit NFTs

Reddit is a social news aggregation, content rating, and discussion website with a substantial user base, featuring 430 million monthly active users and over 1.5 billion registered users. The platform sees approximately 50 million active users each day.

Reddit has been accepting cryptocurrency payments since 2013. In late 2019, they introduced community points built on the Ethereum blockchain. To improve the scalability of these community points, Reddit later adopted the Layer2 scaling solution Arbitrum. In June 2021, Reddit, for a short period, made available four NFT collections called CryptoSnoos, which highlighted the platform's iconic Snoo logo, with prices ranging from 70 to 175 ETH.

Among Reddit's recent initiatives, Reddit NFTs have captured considerable interests. Reddit introduced a custodial wallet based on Polygon, but instead of using the term "wallet", they referred to it as a "vault". Furthermore, Reddit started providing free NFTs to their top-tier users, cleverly labeling them as "collectible avatars" rather than using the term "NFT". These avatars could be used as profile pictures (PFPs) and became a sought-after status symbol for Reddit users who understood the value of community points and reputation. To acquire these avatars, Reddit required users to set up an account with a Polygon-based wallet. However, users might not have been fully aware that this process essentially involved creating a Polygon wallet; they simply regarded it as initiating a "vault" account. This process didn't redirect users to external websites, nor did it require them to memorize the seed phrase or own MATIC tokens for gas fees (Reddit covered the gas fees). Since their launch in July 2022, Reddit's collectible avatars, known as "Reddit NFTs," have attracted nearly 10 million users.

Summary

Mainstream Web2 social apps are venturing into the transition to Web3, although their paths vary due to their significant size and regulatory considerations. Telegram, Twitter, Meta, and Reddit have each taken distinctive approaches to embrace Web3. Telegram has adopted a thorough approach by integrating the TON blockchain at its foundation. While Twitter hasn't directly incorporated blockchain technology, Friend.tech, built on its platform, has witnessed a remarkable surge in popularity. Both Reddit and Meta have displayed enthusiasm for Web3 social trends, with Reddit's strategy notably ingenious.