Decentralized Social Isn’t Failing, It’s Just Being Built Backwards

Every few years, decentralized social comes back into focus.

This time, the trigger was X (Twitter)’s mass bans of so-called “content farming” and airdrop platforms. The event reignited an old question: if centralized platforms are unstable, biased, or opaque, why haven’t decentralized alternatives won?

In a Chinese AMA co-hosted by WuBlockchain and Mask Network, Vitalik Buterin and Suji Yan revisited that question directly.

The conclusion wasn’t that decentralized social is doomed. It’s that most attempts have misunderstood the problem.

Why Vitalik Is Paying Attention Again

Vitalik outlined two reasons for refocusing on decentralized social now

1. The quality problem on Twitter has become obvious. Across crypto, politics and general discourse, discussion quality has declined. Twitter remains dominant due to network effects, not because it is structurally optimized for truth or meaningful conversation.

Network effects remain the hardest barrier in social. No matter how good a product is, without users, it doesn’t work.

Two approaches are emerging to soften that barrier:

• Protocol-layer separation: accounts and content live on a shared protocol, while multiple teams build their own clients. New users don’t land in an empty network.

• Aggregation interfaces: products like Firefly unify Twitter, Farcaster, Lens, and others into one interface, allowing gradual migration instead of abrupt exits.

Both approaches reduce the “cold start” problem without requiring users to abandon existing networks immediately.

2. The technology has matured. Over the past three years, user experience across crypto infrastructure has improved significantly: wallets, privacy tools, messaging systems, and protocol design are all more usable than in prior cycles.

With infrastructure stronger and centralized platforms showing strain, the timing feels different.

The Core Failure: SocialFi Before Social

Vitalik was direct when asked why decentralized social repeatedly fails to find product–market fit, whether it was Steemit, Bihu, Friend.tech, or more recent experiments. 

Two primary reasons:

Network effects are brutally hard

Almost no new social platform has broken through at global scale in the past decade. That alone should temper expectations.

Most projects misidentify the problem

Too many teams start with “crypto finance” as the solution. They add tokens, trading mechanics, SocialFi, before solving the underlying social problem. But social platforms are primarily about creator incentives and discussion quality, not token velocity.

Crypto has tried tokenized creator rewards for over a decade: many failed because speculation and pre-existing influence dominated outcomes. The top earners were already-famous figures, not new high-quality creators.

By contrast, platforms like Substack, without token layers, have shown that sustainable creator income can emerge when incentives align with content quality.

Vitalik’s framing was simple: If you want to build decentralized social successfully, start from the social problem. Don’t start from the token.

Migration Is Real, But It’s Slow

Suji Yan emphasized that user migration does happen. It’s just slow and phased.

Chinese crypto communities migrated from Weibo and WeChat to Twitter and Telegram when regulation or enforcement forced change. But those transitions took years and required pressure plus better product experience.

Decentralized social hasn’t yet reached that tipping point.

His view: centralized and decentralized systems will coexist for a long time. The path is:

Centralized → Semi-centralized → Decentralized

Lens and Farcaster shouldn’t fight each other. The market is too small, collaboration and interoperability matter more than ecosystem rivalry.

Neutrality is also critical. If a network appears controlled by a single company or interest group, broader participation suffers. Durable social infrastructure must feel politically and economically neutral.

Prediction Markets + Social: An Underrated Opportunity

The conversation expanded beyond traditional social design into prediction markets.

Vitalik sees strong potential in combining:

• AI

• Community Notes–style systems

• Prediction markets

• Search interfaces

The goal isn’t speculation. It’s improving discussion quality.

For example:

• When someone makes an extreme claim, a prediction market could immediately surface the implied probability of that outcome.

• Market pricing can cool emotional debates by anchoring expectations.

• AI systems like Grok already improve discourse by flagging inaccuracies, though imperfectly.

  
  

The deeper opportunity lies in integrating markets directly into conversation interfaces:

• “Agree / Disagree” markets under posts

• Market-implied probabilities embedded in threads

• Lightweight prediction-based governance in DAOs

  
  

Vitalik also referenced more experimental designs like quadratic prediction markets, which combine voting, identity and probabilistic forecasting.

The core principle: If the goal is to move closer to truth and better collective judgment, prediction mechanisms deserve deeper integration into social platforms.

Social + Wallets: Convergence With Caution

As wallets gain social features and social apps add financial layers, convergence is accelerating.

Vitalik’s position was clear: the base social protocol should remain simple and neutral. Over-designing the base layer weakens network effects and fragments ecosystems. Ethereum’s wallet portability, users can switch wallets freely, was cited as a model worth preserving in social contexts.

Embedded wallets may lower onboarding friction, but portability must remain intact.

Easy entry, full exit freedom.

That balance determines whether social–wallet convergence strengthens or fragments the ecosystem.

Centralized Social Isn’t the Enemy

When asked about exchange-built platforms like Binance Square, Vitalik took a neutral view: 

The problem is concentration in a single platform. Moving from one dominant network to multiple specialized networks is already an improvement.

The next step would be shared protocol layers enabling selective interoperability, though not necessarily zero-friction integration everywhere. Some boundaries between communities are healthy.

Why Blockchain Social Keeps Failing (And Who Might Succeed)

When asked how to attract talent back into decentralized app development, especially in an AI-dominated era, Vitalik identified a recurring pattern. Many blockchain social and gaming projects failed because users came for financial incentives, not for the product. When token speculation faded, usage disappeared.

The next generation of successful founders, in his view, will:

• Understand social deeply.

• Start from user problems, not token design.

• Treat blockchain as infrastructure, not as branding.

  
  

In fact, someone who understands social but not blockchain may be better positioned than someone who understands blockchain but not social.

As infrastructure matures, blockchain should fade into the background.

Decentralization is not:

• “On-chain + tokens + speculation.”

  
  

It is:

• Reliable coordination.

• Credible neutrality.

• Durable data foundations.

The Long-Term View

Decentralized social hasn’t succeeded yet because most attempts began with financial layers instead of social problems.

But the conditions are shifting:

• Centralized platforms show structural weaknesses.

• Infrastructure is stronger.

• AI and prediction mechanisms open new design space.

• Wallet and identity systems are maturing.

  
  

If the objective is higher-quality discussion, better alignment with truth, and more resilient digital communities, decentralized social remains worth building.

It just can’t be built as a token experiment, it has to be built as a social product first. Read the full interview