Farcaster: An Overview

June 07, 2024

Overview

Farcaster, a decentralized social media protocol on the Optimism network, raised $150M at a $1B valuation to develop its platform. Warpcast is its main app, similar to Twitter.

3 min. read

3 min. read

3 min. read

What is Farcaster?

Farcaster is a decentralized social media protocol designed to support the creation of social media applications. Built on the Optimism network, a Layer 2 scaling solution on Ethereum, Farcaster enables developers to easily create social media applications in a decentralized fashion. This setup enhances data security and ensures that users retain ownership and integrity of their data. Warpcast is currently Farcaster’s flagship social media application. Similar to platforms like X (Twitter), Warpcast allows users to follow each other, post messages (known as casts), like, and share these casts. 

Investors and Valuation

In May 2024, Farcaster raised $150 million in a funding round from Paradigm, bringing their valuation to $1 billion. Other investors such as a16z, Variant, Haun, USV, First Round Capital, and others also participated in the funding round. The new funds will support the ongoing development of Farcaster, focusing on expanding its offerings, including hiring engineers and adding new features. Since launching last October, Farcaster has seen significant growth, reporting over 350,000 paid sign-ups and increased network activity.

Farcaster’s Value Proposition

Farcaster offers a secure and efficient decentralized social media platform by utilizing a hybrid framework of on-chain and off-chain actions. Onchain actions, performed on the Ethereum mainnet, are limited to critical tasks like creating accounts, paying for data storage, and adding account keys, ensuring security and consistency while minimizing costs. Offchain actions, handled by a peer-to-peer network of servers called Hubs, cover most user interactions such as posting messages, following users and updating profiles. This approach enhances performance and reduces costs while maintaining security through on-chain signatures.

Disclaimer: The information provided in this research paper is for educational and informational purposes only. It does not constitute financial advice, investment guidance, or any solicitation to buy or sell financial instruments. The views expressed herein are those of the authors and do not necessarily reflect the opinions of Kollectiv.

2024