Social Layer: Returning to the Essence of Social Interaction

Introduction

In the world of cryptocurrency, incentive mechanisms are an unavoidable topic. This concept originated from the most famous "meme coin" in the cryptocurrency field—Bitcoin. Bitcoin uses a proof-of-work (PoW) consensus mechanism to provide an engineering solution to the Byzantine Generals Problem in order to achieve the vision of a peer-to-peer payment system. To attract miners to participate and enhance system security, the Bitcoin system is designed to provide Bitcoin rewards to miners who obtain the right to maintain the ledger through coinbase transactions. In the early days of Bitcoin, the incentive mechanism was relatively simple and straightforward. As Ethereum's Turing-complete programmability brought rich on-chain applications, the simple incentive mechanisms gradually evolved into complex token economics theories.

Decentralized application (DApp) developers view Tokenomics as core; excellent Tokenomics allows DApp users to maximize personal benefits while achieving the maximization of collective benefits or benefits within the DApp ecosystem. Although well-designed Tokenomics can help protocols enhance economic efficiency and expand usage, it seems that too many developers prioritize Tokenomics over protocol construction. We focus on public chains and the social field, analyzing the importance of the incentive layer to public chains and social DApps through basic principles. For public chains, incentives and consensus mechanisms complement each other to ensure the consistency of the public chain ledger. For social DApps, the goal is to use decentralized platforms to achieve basic social functions, reclaiming data ownership from centralized giants, and then choosing whether to design incentive schemes that can better promote the development of the protocol based on the characteristics of the platform.

For a long time, the social field developed slowly until the emergence of a certain social platform, which injected vitality into the sluggish market through simple and direct incentives. Although the platform has been successful, if the incentives are not sustainable and user growth relies solely on the FOMO feelings brought by these incentives, then whether the protocol can operate in the long term remains an unknown once the incentives decrease and profit-driven users leave.

Social First, then Finance

"When like-minded people come together, friendships begin" - Emerson. The essence of socializing is to find like-minded individuals, or in other words, to seek and form circles. Web2 social software utilizes the convenience of the internet to help users quickly form social circles, where information is easily transmitted and value is uniformly recorded within a single circle. However, these social circles have become islands of information and value. How to quickly break out of these circles and expand personal social boundaries with a unified standard of value or behavioral data is something that the Web2 network struggles to provide. Moreover, Web2 giants can extract user data from these value islands for their own benefit. Users do not own their data; instead, they trade it for the services of Web2 giants.

The characteristics of Web3 have the potential to change the current social model, but its advantages require a well-developed application layer to be released. Taking a certain social platform as an example, it has built the hottest social application in the current Web3 field through the "Fi first, then Social" model. However, its strong Fi attributes result in a social experience that is not prominent. A rational analysis suggests that applications that can truly attract users in the long term should follow the "Social first, then Fi" model. The Social Layer protocol is built on this concept.

The concept of Social Layer originated from a community discussion during the Shanghai Blockchain Weekend at the end of October 2021. The question raised at that time was: how to build an appropriate contribution record and incentive mechanism for the community? Subsequently, the concept of Social Layer gradually developed, forming a complete social network protocol idea. The blockchain provides a data recording anchor point, and its openness helps users break the limitations of circles, rapidly expanding from a point to a surface, connecting one community to another, forming an interconnected social network, where each user acts as a social hub between different communities. In terms of incentives, Social Layer does not overly emphasize the Fi attributes; its current incentive mechanism mainly serves the Social function. Unlike directly rewarding users and communities through quantifiable incentives, Social Layer chooses to use non-quantifiable badges to mark the value of users in the social network. The value of the badges is determined by the consensus of different communities, and the value assessment of badges may vary among communities.

From One to Infinity: Analyzing the Social Layer

Badges are merely a tool used by the Social Layer for value measurement, but this is far from sufficient to support its grand goal of building a "social layer." The following will provide a detailed analysis of the various components of the Social Layer and showcase some of its innovative highlights.

Identity

Identity is the identifier for all organizations and users in social networks, mapping personal characteristics from real life to the virtual network in various ways. Successful identification ultimately forms an identity that carries network data. In the Social Layer, Identity is divided into two subcomponents: Profile Token and Group Profile Token.

The sending and receiving of badges require independent entities. Profile Tokens and Group Profile Tokens serve the roles of these entities, carrying descriptive information related to users or organizations. Profile Tokens are designed to be non-transferable, which aligns with the principle in the Social world that identities should not be obtained or misappropriated by others for malicious actions.

Considering the limitations of the current Web3 architecture, all on-chain assets are forcibly tied to private keys, and when the private key is lost, the Profile Token will also be lost. The Social Layer expands the recovery mechanism in this regard. The Group Profile Token can be transferred through governance. As the entity that sends badges, Identity needs to reasonably allocate the quantity of badges sent and individual credit. Although badges have non-quantifiable value, their value assessment can be determined through community consensus. If a badge is abused, the community's recognition of that badge will significantly decrease.

Social Token

Social Tokens are various functional tokens that circulate within the Social Layer. The first type of Social Token is the badge mentioned earlier. The Badge is designed as a Soulbound Token (SBT), making it non-transferable and bound to an Identity. This design is also aimed at preventing others from acquiring or stealing the badge and using it to approach individuals with the same badge for malicious purposes. By reducing the risk of social engineering attacks, the network trust of the Social Layer will significantly increase. The same badge can have multiple recipients, which meets the actual usage scenario needs of badges.

The second type of Social Token is a common NFT, which can ultimately flow into the NFT trading market for transactions. Social Layer has currently conducted limited exploration of NFT functionalities, such as developing the NFT Pass feature, which is used as a pass and has been practiced in a certain offline DAO space. Of course, NFTs can also be used as tickets, membership cards, and so on.

The third type of Social Token is the Gift Card, which essentially serves as a consumption right attached to the badge. For example, after a coffee brand joins the Social Layer, it can organize a coffee community and send supporter badges to loyal users, with the badge including a Gift Card that users can use to obtain a few free coffees.

The fourth type of Social Token is the Private Badge, which is an extension of the regular badge. Private Badges are designed so that only the sender and the receiver can see the content. Private Badges can define deeper social relationships, but currently, they are still in development.

The last type of Social Token is Points, which are based on the ERC-20 standard and serve as fungible tokens. Points can be expanded for various uses. For example, points can be assigned to individuals by the community based on their contributions to society, and when a certain amount is reached, individuals can apply for badges from the community. Alternatively, points can be used for voting on community public affairs to decide the future development direction of the community.

Currently, the creation of Social Tokens can be customized with one click, without the need to focus on the underlying standards of the Token. Users only need to create a Token type that suits themselves or their community based on their needs. In addition to the aforementioned types of Social Tokens, the Social Layer can continuously expand different types of Social Tokens in the future. This is mainly because the updates of the underlying standards are relatively slow, while the innovation speed at the application layer is very fast, which gives its Social Tokens strong scalability.

Merger & Wrapper

These might be the two most interesting functional components. Merger can combine multiple Social Tokens into one or more new Social Tokens, and it does not restrict the types of Social Tokens that need to be combined, nor does it restrict the types of Social Tokens that can be formed after the combination.

Imagine that in a gaming community, you actively participate in discussions and earn a veteran gamer badge; write guides and receive 5000 contribution points; attend offline meetups and obtain multiple commemorative NFTs. At this point, using the community's Merger feature, you can combine the badge, contribution points, and commemorative NFTs into a gaming swordsman badge. Those who possess this badge become trusted intermediaries in the gaming community and can engage in equipment trading. This is just a simple use case; the potential of Merger is limitless.

Wrapper provides cross-protocol value aggregation. Specifically, tokens from other protocols or chains can invoke the Wrapper function to package them into Social Tokens that can circulate on the Social Layer. Taking the same gaming community as an example, the community originally held offline gatherings where participants received a POAP. Later, the community chose to migrate to the Social Layer. The community can allow users to use the Wrapper function to package the previous POAP into SoPOAP. SoPOAP can then be merged with later Social Tokens to form a new Social Token. Furthermore, if a certain cryptocurrency is packaged into So cryptocurrency using the Wrapper, users can use So cryptocurrency to purchase items that can be resold on the Social Layer, creating a small decentralized exchange.

The Future of Trustworthy Social Collaboration Networks

Social Layer is actively exploring its use for internal collaboration between DAOs. Based on a programmable blockchain architecture, Social Layer can continue to expand its functionalities and broaden its use cases. If Social Layer can sustain its development and transcend market cycles, it is expected to become the infrastructure for a trusted social collaboration network in the future, bringing a new Web3 social experience.