Towards A Decentralized Social Ecosystem With Power To The People

(“Away from the ‘Facebook’ Ecosystem, towards a decentralized ‘Social’ Ecosystem”)

4 min readMay 6, 2021

#ANewSocialWorld #Blockchain #SmartPlacesToken #SocialToken

Online platforms connecting millions of people have become the biggest companies in the world. They have been very successful in creating huge networks that bring people together.

However, there are a few flaws in this process (model), namely decreasing authentic content, increasing fakes and scams which are hard to verify and finally lead to a massive waste of time. Often there is an inherent moral hazard problem which leads to a ‘distrust’ of these services. The result is that users are discouraged and abstain from using these services.

Moreover, while these platforms are able to efficiently cluster interests and organize categories or groups there is still a lack of instant real life interaction or instant connecting. Users expectations are often not aligned with the offerings of these platforms.

The users’ need for using online services must be considered and understood to correctly align online platforms and services to meet users’ expectations. We claim that there’s a need for instantaneous matching of interest for any real-life situation or opportunity. Although there are many possibilities, offers and services for online social interactions there seems to be a lack in instantaneous and local matchmaking services to achieve optimal users’ satisfaction.

All this culminates in the users’ deep desire for authentic and useful (here: local and instant) social interactions. Local markets or local networks could be an answer to solve all three issues. However, until now these solutions have not been explicitly brought to our attention. This raises several questions: could this idea be introduced as a new business model? Did companies perhaps fail to implement this kind of business model due to missing technology? Does a fundamental market failure prevent instant and local markets to emerge? Or is there simply a lack of user demand for
such markets?

Answering these questions will exceed the scope of this paper; however, we would like to pose one fundamental question: If there is indeed the need for a new innovative business model how should this venture be initiated and executed? Facebook or so called ‘intermediaries’ have reached the status of uncontestable monopolistic platforms and dominate the whole market. Should innovators do the same and try to establish just another monolith rising and aligning to all the other dominant market players? Monopolies bear the ‘chicken egg problem’, i.e. they suffer large upfront costs. But once such a business is established and once a ‘value network’ with mass adoption is created these platforms possess a dominant market position and benefit from absorbing huge profits while the users as the true producers contribute for free. After all, the standard user participates with no reasonable share in monetary gains.

In our view this traditional company approach will not be sustainable in the future anymore: due to the blockchain technology there is no need for an ‘intermediary’ anymore, thus all big ideas and innovations could theoretically be executed by the crowd, the customers. So instead of answering why such a business model (creating and establishing local markets or networks for the users) does not yet exist we want to focus on how such a business should be constructed and initiated from our point of view:

A New Business Model With Power To The People

It will consist of a general framework with at least these two fundamental ingredients: 1. users incentivisation to engage, that is contributing to and thus building ‘value networks’ with the users full freedom on how these networks or platforms should be constructed, i.e. there is no authority who sets the rules but the ultimate power is to the people. 2. Users’ participation in capital gains once the value community is big enough to attract advertisers & investors. These gains are not always obvious for the normal users perspective and gains may be hard to understand and foresee ex ante.

Thus, our understanding or main interpretation of the word ‘decentralization’ within the blockchain universe is on the one hand from an organizational perspective that there is no single authority which dictates the formation of networks and communities with regards to content and on the other hand from the business model perspective there is no intermediary or single platform operator who absorbs all benefits arising from the creation of value communities or public goods.

Users often do not care to earn money while using social media; they rather enjoy non-monetary benefits while using these services without realizing that their free engagement in and usage of these platforms for free comes along with selling their assets and personal data (and more dramatically bears inherent hidden costs, i.e. see ‘Netflix — The Social Dilemma’). An approach via tokenization in combination with public accessible blockchains / distributed ledgers is a promising concept in the blockchain universe which is able to solve this issue in a revolutionary and elegant manner. Although the blockchain technology is still a black box for the normal user, we strive to make it easily understandable by introducing the use of tokens in combination with a seamless gamification approach: People love to collect things. And if collecting tokens is easily perceived by users without confusing them in their original interest to engage for any online service this could be a good fundament to start a new modern approach of a business venture.

Our mission is to kickstart the venture with initial governance while we commit ourselves in the mid-term to hand over this venture to a decentralized governance — with power to the people.

This is what we stand for with our SMART PLACES PROTOCOL.

— — More detailed information will follow in the upcoming articles — —

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SocialFi - done right! | SmartPlaces is a social ecosystem based on geolocation that rewards users for connecting and interacting. |