The value of traditional social networks depends on directing users' attention to content & ads. Farcaster is pushing moderation at the channel level, turning channels into valuable assets.

The ability to curate content is the source of social networks' economic value. Controlling the feed ensures that 1) users see engaging content and 2) paid messages (like ads) are effectively integrated into the content consumption, and targeting the right users.

Farcaster channels inherit the power to recommend and moderate content. The latest experiment by Farcaster allows channel owners to select, display, and order content in the channel feed. The update aims to provide flexibility, allowing different channels to implement unique moderation/recommendation mechanisms.

The main consequence of this design choice will be experimentation from channels on a) different moderation/recommendation styles and b) monetisation. Focusing on (b), channel owners can now create economic mechanisms to determine what content appears and in what order. A simple example would be an openrank-like mechanism for the top cast in a channel, where third-parties can bid to display an add or a message in a high-traffic area of Farcaster.

An important caveat is that this depends on the major client (currently Warpcast) displaying content as the channel owner intends, respecting channel sovereignty.

If that holds true, I expect channels to become a valuable asset, and one of the most valuable activities on Farcaster to grow engaging and large channels.

Moderation is a headache for any social network, especially decentralized platforms like Farcaster. Bots and spam push away legitimate users and drown good content. On the other hand, developers expect permissionlessness and decentralisation. Control over recommendation algorithms is the modern equivalent of absolute power, and no one appreciates a monarch.

Farcaster is running an experiment in moderation that is extraordinary in two regards:

• First, they delegate the decision-making power at the channel level (community discussion forums, similar to subreddits), and let any channel owner recommend content their own way.

• Second, the core mechanism is to empower moderators to elevate good content, instead of censoring bad content.

The core mechanism is a binary system where channel moderators or bots flag quality content. Anyone can post in a channel's, but the main feed the users see by default is composed of posts selected by the moderators. The algorithm for good content can be simple rules enforced by a bot like Automod ('poster has a power badge'), complex classification models predicting engagement, human curation, or a combination.

The main benefit of this system is giving developers maximum flexibility. Channel owners or app developers can plug their own moderation/filtering algorithms. Some channels will be human curated, others will use X-like algorithm for engagement, and some might use Reddit-like upvotes. Second, third-party developers can consume that data to inform their own recommendation/moderation engine.

I look forward to seeing many moderation & recommendation experiments. Channels and their interfaces/clients are products with a job to be done, and recommending the right content is crucial. Product support channels (like /neynar or /supercast) might benefit from upvote-based systems, while personal channels (shameless plug for /luc) rely on individual curation. Flexibility allows different channels with varied content to use suitable content surfacing mechanisms.

Philosophically, I find the principle of elevating over censoring to be more appealing. No one envies the hired moderators who are subjected to violent and graphic content on X, Facebook, and other social platforms, like the characters in 'A Clockwork Orange.'

As the cost of content creation trends to zero with generative models, personal and positive curation increases in value. Farcaster channels have a great opportunity to be the place where the best content is created and surfaced.

Traditional social networks offer creators the possibility to monetize mainly one-to-many relationships.

The basic description of these transactions is: the creator shares a product and gets paid for the placement.

It’s a reasonable way to make money, but it narrows the scope of how creators can create and capture value. There are few well-connected nodes making substantial amounts.

Some interactions that users crave and can lead to sustainable businesses include:

• Direct interactions from followers to creators

• Inter-follower transactions

• Sub-community formation/transactions

Proxy Studio is an interesting place for experimentation on how decentralized social can monetize through various interaction types:

• Direct economic transactions - through a Hypersub subscription, people pay Alex directly for access to his group chat and newsletter.

• Shared capital and pooled information - in a many-to-many relationship, through Mercenary Capital, Proxy members surface investment opportunities and pool capital for collective dealflow/access.

• Ownership in community-generated initiatives - the chat is filled with idea people with a bias towards action. Initiatives launch independently but as a result of community interactions. They usually share economics with Proxy.

• Intra-community transactions - There is an increasing number of transactions between Proxy community members. For instance, a member with whitelist access might share it. Another is the secondary market for shares of Mercenary Capital or the Hypersub NFT. These are prime candidates for monetization.

The beauty of Farcaster is that communities like Proxy, or Degen form and become experimentation grounds. These emerging behaviours give us a glimpse into the future of the protocol and social as a whole.

Study Proxy.