Author: David, TechFlow TechFlow
Original title: Web3 Social Media: Still Dominated by Chinese?
Within two days, the two decentralized social protocols changed hands.
On January 20, Lens Protocol announced that it had been taken over by Mask Network. On January 21, Farcaster announced that it had been acquired by Neynar, one of its clients.
These two protocols together raised over $200 million. Farcaster was valued at $1 billion last year, with investors including a16z and Paradigm . Lens is backed by DeFi giant Aave .
Now, the founders have all "stepped down from their day-to-day work to work on new projects."
Including Steem, another well-known project acquired by Tron in 2020, two of these three phenomenal decentralized social protocols have been taken over by Chinese teams.
You may have forgotten Steem. It was the pioneer of "writing mining" launched in 2016. At its peak, it was a benchmark project in the entire Web3 social networking field. After being acquired by Justin Sun, the community forked and ran away. We'll talk about that later.
Mask Network, which took over Lens, was founded by Suji Yan. A Chinese national, he dropped out of UIUC at age 20 to start his own business and previously wrote for Caixin and Jiemian.
Mask was founded in 2017 to add Web3 functionality to traditional social media platforms such as Twitter.
Mask has been making acquisitions in recent years: in 2022 it acquired two large Japanese instances of Mastodon, last year it bought Orb, the most active client on Lens, and now it has taken over Lens itself.
Suji Yan positions himself as "the Tencent of Web3".
On the Farcaster side, the two founders of Neynar who took over are of Indian descent and are both former Coinbase employees. However, the fact remains that two of the three agreements resulted in Chinese acquisitions.
Why Chinese?
One possible explanation is innate ability. The two most successful countries in the world for developing social products are the United States and China. With WeChat, Douyin, and Xiaohongshu, Chinese teams have proven that social media can reach a billion users.
But this explanation is flawed. Developing a product and an acquisition agreement are not the same thing. An agreement is infrastructure; it doesn't directly interact with users. You can build products on top of it, but the agreement itself doesn't create a user experience.
Another reasonable explanation is price.
Looking at Sun's acquisition list, he bought BitTorrent for $140 million in 2018, Poloniex in 2019, Steemit in 2020, and HTX in 2022.
These targets have one thing in common:
They all had their glory days, but are now on the decline. BitTorrent was the pioneer of P2P downloading, Poloniex was once a leading exchange in the United States, and HTX was once one of the top three exchanges in China.
Justin Sun didn't buy the best; he bought the cheapest good stuff.
Farcaster is now valued at $1 billion, but its monthly revenue has plummeted to $10,000, a year-over-year decrease of over 95%. Founder Dan Romero admitted in a post last month that "after four and a half years of trying a social-first approach, it hasn't worked."
Lens only has 50,000 monthly active users, and the Aave team wants to divest it to focus on their core DeFi business.
The most valuable period for these agreements has passed, but the technological foundation and brand remain. In A-share market terms, this is called:
It has fallen below its intrinsic value.
There is an even more subtle extension of this thinking: decentralized social networking is a belief in the West, but a business in China.
Western founders who entered this field were driven by a degree of idealism. They believed users should own their own data, social graphs should be transferable, and platforms should not have censorship rights… Farcaster's slogan was "able decentralized," and Lens's was "user-owned social."
But after five years, users didn't care.
Ordinary people don't care who owns the data, or whether they can take the social graph with them. What they care about is whether there are people to chat with, whether there is fun content, and whether there are related assets that can skyrocket in value.
The fact that Chinese buyers took over the business, in a sense, meant taking it from idealists and handing it over to pragmatists.
Suji Yan said that Mask aims to "bring decentralized social networking from the laboratory into everyday life." In other words:
Forget about ideals, let's get people willing to use it first.
Of course, the last time a Chinese company acquired a decentralized social protocol, the outcome wasn't very good.
In 2020, Justin Sun acquired Steem. After the acquisition, he partnered with exchanges to gain control of the Steem network, but the original community reacted by collectively forking a new chain, Hive, and using code to exclude Justin Sun's wallet.
Forking is the most extreme form of protest in the blockchain world: we're not playing with you anymore, we'll just copy ourselves and leave.
Steemit is still running, but most active users have long since moved to Hive.
So the question is, will this time be different?
Mask's takeover of Lens is officially termed a "stewardship," not an acquisition. The founders will continue to serve as advisors, and the agreement remains open.
But the fact that "decentralized protocols" can be acquired already raises some questions. Contracts can be transferred, codebases can be transferred, apps can be transferred. So where is the "decentralization"?
After the hype is dispelled, decentralization is merely a technical architecture, not a business model. Technical decentralization does not preclude someone from having the final say in business.
After Lens changed leadership, Vitalik posted a message saying that every piece of content he would post in 2026 would be through Firefly, a multi-platform client owned by Mask Network.
He added, "If we want a better society, we need better tools for mass communication."
That's true. But decentralization doesn't answer the questions of who builds the tool, who operates it, and who decides what it looks like.
The answer now might be that it will be built by Chinese people.
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