By
Temitope Olatunji
April 18th, 2024
Given the failure of other major players to build a successful alternative to Twitter, can Aave succeed?
DeFi protocol Aave announced a plan to launch an alternative social media platform to Twitter. According to Stani Kulechov, founder and CEO of Aave, the platform will run on the Ethereum blockchain.
Unlike with Twitter, Kulechov noted users will make money from their content and contribute to the rules of the network. “We believe that content creators should own their audiences in a permissionless fashion, where anyone can build new user experiences by using the same on-chain social graph and data,” he said.
DeFi pulse data suggests that Aave has up to $10.9 billion in its system. This makes it the largest DeFi protocol. Primarily, its products allow users to borrow or lend cryptocurrency using smart contracts. This is totally unrelated to the newly announced social media project.
Why DeFi Protocol Aave Wants to Launch an Alternate Social Media
Kulechov speaking said that “Since Jack is going to build Aave on Bitcoin, Aave should build Twitter on Ethereum.” Founder of Twitter Jack Dorsey had suggested he was looking to adopt Bitcoin and blockchain to decentralize Twitter. In the last year, his payment provider also purchased over 8000 BTC worth about $252 million. However, there has been no concrete actions in that regard.
Kulechov noted the challenges associated with a permissioned social media platform are censorship and a payment system that benefits platform creators over users. “Twitter makes all the revenue from your tweets and the content you share, and Twitter decides which of your tweets get traction through the algorithm,” he said. These two challenges will be put to bed by a decentralized alternative.
Already, there have been moves to create some alternatives but none has gained the necessary ground for adoption. For example, Steemit was purchased by Tron blockchain after a bungled acquisition made users defect to Hive. Also, Voice, which was built to run on the EOS blockchain by Block.one was built and abandoned. This was traceable to ‘censorship pressure’.
Kulechov believes that a critical success factor for this project would be that creators will allow their followers to vote on their preferred content through decentralized autonomous organizations (DAOs).
Aave may be a key player in the DeFi industry. However, given the failure of other major players to build a successful alternative, can Aave succeed? Will the company really build an Ethereum-driven alternative that will compete with Twitter?