Author: zhou, ChainCatcher
Farcaster co-founder Dan Romero ( dwr ) recently announced that the platform will undergo a major strategic shift, officially abandoning the "social-first" path it has adhered to for the past 4.5 years, and instead embracing a growth model driven by the "wallet core".
Farcaster was initially positioned as a decentralized social network, enabling developers to build innovative social networks. It's an open protocol that can support many clients, much like email. Users will always be free to move their social identities between applications, and developers will always be free to build applications with new features on the network.
Dan Romero stated that, under a social-first strategy, the platform released a fully functional protocol version that was decentralized enough to allow multiple independent teams to build on and integrate with it. However, data shows that despite significant efforts, the social-first strategy ultimately proved unsustainable.
In early 2024 , thanks to the Frames feature and the DEGEN airdrop, the platform's daily active users ( DAU ) surged from around 2,000 to 100,000 , and registered users exceeded 350,000 , with a monthly growth rate of over 400% at one point.
However, the peak lasted for less than three months. Starting in September 2024 , the data experienced a precipitous decline: DAU dropped back to around 60,000 , monthly active users decreased by 40% month-on-month, and the number of new user registrations per day plummeted from a peak of 15,000 to just a few hundred.
Entering 2025 , the situation continued to deteriorate, with daily active users on the social side dropping by nearly 40% again. It wasn't until the launch of the USDC deposit 10% reward program in October that the overall daily active users were brought back to the range of 50,000 to 60,000 by relying on the wallet function.
At the same time, the agreement's revenue also plummeted: by October 2025 , monthly revenue had dropped to about $ 10,000 , the lowest level in four months, a decrease of about 99% from its peak.
Faced with this harsh reality, Dan Romero admitted that he has consistently failed to find a sustainable growth mechanism for Twitter -like social networks .
Therefore, Farcaster 's transformation decision was to take a pragmatic approach, no longer pursuing a purely social narrative, but instead betting resources on the rapidly growing wallet functionality: first use the tool (wallet), then build the network (protocol) .
The team observed that the wallet feature, launched in the app earlier this year, expanded rapidly and was the module they had come closest to product-market fit in five years. The new user flow was redesigned as user registration - wallet top-up - wallet usage, with wallet top-up and tool usage as activation points.
Dan Romero summarized that every new, retained wallet user is a new user of the protocol. As users have commented, SocialFi is a combination of social and financial, and combining it with a wallet is just the beginning.
At the product level, Farcaster 's official app, Warpcast, has shifted its core goal to building a superior wallet , focusing on expanding the crossover capabilities between wallets and social networks. DWR believes that adding a wallet to a social network is easier than adding a social network to a wallet . This integration is achieved through the Farcaster Mini App , a lightweight web application based on the Farcaster protocol that can be seamlessly integrated into clients like Warpcast .
At the same time, Farcaster is also actively deploying financial infrastructure:
- Asset Issuance: By acquiring token issuance platform Clanker , Farcaster has equipped its wallet core strategy with asset issuance capabilities and now holds 1.8% of Clanker's total supply.
- Financial Incentives: In October , a USDC deposit program was launched with an additional 10% reward, directly accelerating the conversion of users into on-chain asset holders through financial incentives.
At the content level, Frames (interactive mini-apps) are the display form of Mini Apps in the news feed and are the key hub for realizing the " content as a transaction " mechanism. Users can directly complete financial activities such as minting, trading, and payment within the news feed. Every interaction directly drives the use of the built-in wallet. This model transforms Farcaster from an information consumption field into a value transfer field, accelerating the financialization process of the ecosystem.
Of course, this strategic transformation is built upon Farcaster's strong resource base and elite team background. The platform has attracted the attention of top institutions including Paradigm , a16z , and Union Square Ventures , raising $ 150 million in its Series A funding round in 2024 , reaching a valuation of $ 1 billion . Regarding the team, core members such as co-founders Dan Romero (former VP of Operations at Coinbase ), Varun Srinivasan , and Linda Xie (an early Coinbase employee) as head of the developer ecosystem all have strong Coinbase backgrounds. Coinbase Ventures also participated in Farcaster 's early seed round funding.
However, this transformation has also been accompanied by industry skepticism regarding the "maximization of decentralization." Renowned crypto researcher CM believes that Farcaster's shift to a wallet-centric approach and abandonment of its social-first strategy signifies the end of SocialFi's last dream, and the entire crypto space seems to have returned to the 2017 ICO era, where "everything revolved around trading and issuance."
Other comments pointed out that Farcaster's early products suffered from low usability and slow login on Android systems, and criticized it for making some pragmatic decisions regarding decentralization and user experience that did not appeal to decentralization maximists.
In his post, Dan Romero clarified that this does not mean the protocol has become a casino. The Farcaster protocol remains an open system, and developers are free to choose which parts they deem most useful . The official app ( Warpcast ) simply chooses to focus on the "intersection of wallet and social," while other clients such as Uno , Recaster , and Cura are taking different approaches.
In other words, if users don't agree with this direction, they can choose to use other clients, build their own, or consider another social network . CM also added that it's theoretically possible to build other clients, but it's estimated that very few people would attempt it in the current climate.
Furthermore, some commentators have pointed out that the current wallet market is already highly competitive, with platforms like Base App actively developing, posing a challenge to Farcaster . At the same time, the winner in the wallet competition must correctly answer one question: What wallet functions do people truly want? Overloading the market with features can lead to feature overload, ultimately resulting in a bloated and unwieldy wallet.
In summary, Farcaster 's transformation was driven by harsh market data and pragmatic execution. It revealed the essence of the current SociFi sector and set a key tone for it: pure Web3 social networking may not be viable. It requires high-value, high-frequency financial tools as the entry point and content-driven financialization mechanisms as the core of network stickiness and value accumulation.
