What is the DESO token?

DESO is a layer 1 public blockchain, and its main difference from Ethereum, SOL, and other public blockchains is that DESO is a decentralized social network blockchain. Most layer 1 blockchains rely on smart contracts and are primarily used in DeFi applications. DESO is currently the only blockchain dedicated to decentralized social communities.

Because DESO primarily focuses on decentralized social networks, it contains a large amount of user data on its blockchain. This data is mainly obtained from traditional Web2 communities, such as Twitter and Facebook. However, due to the transparent nature of blockchain, sensitive information is not stored on the chain, such as phone numbers and personally identifiable information, as it would violate privacy protection laws in various countries.

Decentralized Social Networks vs. Decentralized Communities

There is a significant difference between communities and social networks. A social network is a functionality, while a community is a representation. For example, a DAO can be considered a decentralized community, even though DAO stands for Decentralized Autonomous Organization. Social networks like Facebook and Twitter provide networking functionalities. Social networks are subject to regulations in various countries to prevent the spread of fraudulent information. This regulatory aspect is the biggest bottleneck for decentralized social networks and the primary reason why DESO has not been a major hot topic since its inception.

Another reason why decentralized social networks are not a hot topic is that they are not essential for users and do not generate as much wealth effect as DeFi.

The Value of Social Networks

Although social networking functionalities themselves may not have particularly high value, user data is extremely valuable. The more users, the more a community can form around influential individuals (KOLs). These communities have significant value and influence. Over 90% of Web3 projects are disseminated through Twitter. The first user to invest in Pepe, for example, was discovered on Twitter. DESO has collected a vast amount of user-generated content from Twitter and Facebook. With the help of this community, DESO has formed its unique ecosystem.

This ecosystem includes applications like Diamond App, DEX, and NFT trading platforms, comprising nearly 10 different applications. These are projects that cannot be carried out on traditional Web2 social networks but can be realized through blockchain and decentralized social networks in Web3.

In addition, DESO is a public blockchain that is independent of Ethereum, Bitcoin, and other public blockchains. It has strong differentiation in terms of services.

Decentralized Communities on DESO

DESO has two main decentralized community applications: Diamond and Desofy. Diamond is similar to Twitter, while Desofy is similar to a mobile version of Facebook. These communities allow users to issue their own tokens on DESO and set their prices. These tokens are called creator tokens, and when registering in the community, users are required to purchase at least one DESO token.

The price of creator tokens can rise or fall based on user “votes” (similar to likes and dislikes). For example, if a user is a KOL (Key Opinion Leader), and after issuing their creator token, their fans reward them with Diamonds, the token price may rise to $1000 per token. However, if the KOL’s behavior or statements upset their fans, resulting in dislikes, the price of the creator token may drop, even back to its initial value. This feature connects fans and KOLs in a Web2-like manner, while creating a distinction from fan tokens. The main difference is that anyone who enters the DESO social network receives one DESO token.

Additionally, DESO’s decentralized community includes applications similar to LinkedIn, TikTok, and blogs, all of which are decentralized. This means that any content posted on these platforms is not subject to any censorship.

DESO NFTs

DESO has the ability to mint content posted in its community into NFTs, which can then be sold on NFT marketplaces such as NFTz.

Therefore, DESO has brought all existing Web2 social media applications, including text, video, and even messaging tools, onto the blockchain. This creates a vast ecosystem. For example, the market value of LinkedIn is $30 billion, and a similar decentralized platform on DESO, Entre, could have a similar value. If all these projects are successfully implemented, the platform’s value would be tremendous. This is why DESO’s price could potentially increase by more than 100x.

However, this also poses a risk for DESO, as any Web2 platform could potentially upgrade and become a direct competitor. After all, DESO has only obtained a portion of their content, and Web2 users are not immediately drawn to DESO. DESO is not essential to them at the moment. Therefore, the official promotion emphasizes that DESO does not aim to compete with Web2 social media platforms. Instead, it allows users to convert their free content into profitable NFTs through decentralized social media.

As of June 2023, DESO has approximately 2 million users, which is a small fraction compared to the massive user bases of existing social media platforms. Additionally, internet content is mostly free, and the main source of income for KOLs is advertising. This contrasts with decentralized media, where KOLs sell and increase the value of their “creator tokens” to their fans.

Who Invest DESO ?

DESO has attracted prominent investors, including A16Z and Sequoia Capital, similar to Base. The total investment has reached $200 million. The total supply is 10.8 million, with 10.5 million tokens released into the market, indicating almost full distribution. There is no lock-up period for the team and investors because it is challenging to verify their holdings in a layer 1 public blockchain, making it unclear whether they cashed out at the high price of $180. If they have already cashed out, it is unlikely that the token would become a 100x coin. However, if the investment institutions still hold their tokens, there is a possibility for it to become a 100x coin during a bull market.

DESO Coin Mining

DESO cannot be obtained through mining. Every user who joins the DESO network receives an initial DESO token called a “creator token.” The price of the creator token for each user is influenced by their number of followers and the number of Diamonds received as rewards. Each user’s creator token has its own initial value and price.

The level of activity in DESO’s decentralized community is not as high as that of Web2 communities, and its integration with Web2 communities is also not well-established. Instead of being considered a decentralized community, DESO is more like a direct competitor to Ethereum.

Price Prediction for DESO: Will it be the next 100x coin?

DESO is a token that was launched during a bear market and has a strong investment background. Its price once reached a high of $180 but subsequently declined due to market conditions. The main reason for this decline is the small user base, with only 2 million users. This makes DESO not a significant player in the industry. Although DESO is a leading project in the decentralized social media sector and includes replicas of all Web2 social media platforms, these projects are in competition with existing Web2 platforms. DESO can be seen as constantly replicating Web2 platforms in the Web3 domain to attract existing Web2 users.

Decentralized social media is an interesting topic, but it is not currently a hot trend. If a project does not become a hot topic, it is unlikely to experience significant price growth. When compared to Ethereum, DESO appears to be a direct competitor rather than a distinct entity.

Ethereum has a supply of 120 million tokens, with a token price of $1900. The number of tokens launched in the Ethereum ecosystem exceeds 20,000, and it ranks second on BingX Market Cap.

DESO has a supply of 90 million tokens, with a token price of $9, and approximately 10 projects in its ecosystem. It ranks 263rd on BingX Market Cap.

With a supply similar to Ethereum and a token price of $9, DESO would need to increase by 100 times to reach $900. To support such growth, the number of supported projects would need to exceed 10,000. If we consider user numbers as a criterion, DESO would need to have an active user base of 100 million, equivalent to the number of current Ethereum addresses holding tokens.

Facebook took 4.5 years to exceed 100 million users, while ChatGPT reached that milestone in just 2 months. Therefore, for DESO to achieve 100x growth within 3 years, it would require significant strategic adjustments. Otherwise, it is more likely that DESO’s price will return to around $40 in the next bull market.

In summary:

The feasibility of decentralized social media networks is difficult to determine as they are subject to regulations worldwide. The extent of regulation is still uncertain. Similar to the banking system, media organizations will not become decentralized.

As the regulation of DeFi intensifies, decentralized social media networks will soon face similar challenges. DESO’s user base is currently small, with only 2 million users. For DESO to succeed, it must either achieve a user base of over 100 million or be replaced by various Ethereum-based ecosystems within the next 3 years.

For retail investors, investing in DESO may not result in significant short-term price increases but also not significant declines.

Disclaimer:

The above content does not constitute any investment advice. Users are encouraged to conduct their own research (DYOR).