The digital landscape has evolved dramatically, transitioning from the Web2 era, where centralized platforms like Facebook and Twitter dominated, to the decentralized promise of Web3. Today, 4.8 billion people use social media, with platforms controlling their data. In contrast, Web3, valued at $27.5 billion, offers a decentralized internet built on blockchain, empowering users to control their data and transactions. By 2030, Web3's worth could reach $81.5 billion, transforming users from passive participants to active stakeholders.
However, the current landscape of Web3, as of late 2023, seems to be navigating through a period of skepticism and caution. In the first quarter of the year, funding to VC-backed Web3 startups dropped to its lowest since the early days of the space. Venture funding saw a sharp decline of 82% year-over-year, dropping from $9.1 billion in Q1 of 2022 to a mere $1.7 billion. This funding number also marked a 30% decline from the final quarter of the previous year.
Such a downturn in funding is indicative of the skepticism surrounding Web3's viability and future potential. Brands that once eagerly staked their claim in Web3, like Wendy’s with its 'Wendyverse' in Meta’s Horizon Worlds and Miller Lite's virtual bar in Decentraland, have shown signs of pulling back. Additionally, social Web3 platforms, which had previously seen a surge in interest, are also experiencing a slowdown. For instance, platforms like BitClout, which aimed to decentralize social media influence, have seen reduced traction.
Adding to this atmosphere of uncertainty is the broader cryptocurrency market's recent downturn. As of September 2023, the global crypto market cap has declined by nearly 67% from its all-time high in November 2021. Major cryptocurrencies like Bitcoin and Ethereum have also experienced significantly reduced trading volumes. These market dynamics, combined with the challenges facing Web3, suggest a period of reflection and adjustment for the decentralized tech space.
Even as the broader Web3 landscape faces challenges, some projects remain undeterred in their mission. CyberConnect, a standout in the SocialFi space, continues its development, leveraging the capabilities of Account Abstraction (AA). AA, in the context of CyberConnect, abstracts the relationship between signing keys and on-chain accounts, allowing for more flexible and secure user interactions. This approach enhances both security and usability, ensuring a more streamlined experience for users. As we delve deeper into this article, we'll explore the finer details of CyberConnect and its potential to reshape the Web3 ecosystem.
II. What is CyberConnect?
CyberConnect's journey in the decentralized social networking space began with a strong foundation. On November 16, 2021, they secured a seed funding of $10 million, co-led by Multicoin Capital and Sky9 Capital, with notable participation from investors like Animoca Brands and Hashed. Building on this momentum, in May 2022, the company announced a Series A funding round totaling $15 million, again co-led by Animoca Brands and Sky9 Capital. This funding aimed to further develop its decentralized social graph protocol, expand the team, and onboard a variety of Web3 projects. The company's vision, as articulated by co-founder Wilson Wei, is to shift from the Web2 model where companies with large social networks control users' social graphs to a Web3 model where users can move between applications with their social graph as part of their Web3 identity. This aspiration is underscored by the increasing demand for individual data ownership, with nearly 50% of consumers expressing concerns over their lack of personal data ownership.
CyberConnect's decentralized social graph protocol was built with IPFS and Ceramic, representing over 9 million connections across more than 620,000 addresses. This protocol aids dApps in creating personalized social experiences and bootstrapping network effects. Notably, the protocol has been integrated by various Web3 projects, including Project Galaxy, Mask Network, Light.so, Grape.art, Metaforo, and forum.theopendao.
The technical side of CyberConnect can be complex. But with Chainslab's help, we'll explain it as simply as a story for a 5-year-old.
Imagine you have a big box of colorful LEGO bricks. Each brick represents a piece of information about you, like your name, your favorite color, or who your friends are. In the old way (like Facebook or Twitter), someone else owns the box and decides how you can play with the bricks. They can even peek inside and see what you've built.
CyberConnect is like getting your own special box where you're the boss. You decide who can see your bricks and how you want to play with them. Plus, no one can take them away or peek inside without your permission. And the best part? If you want to play with your bricks in a different game or with different friends, you can easily carry them over without starting from scratch!
As we dive deeper into the world of CyberConnect, it's essential to understand the foundational pillars that make it stand out in the vast digital landscape. These pillars, or core concepts, are the building blocks that define how CyberConnect operates, ensuring users have a seamless, secure, and empowering experience. Let's explore these in detail:
CyberAccount is not just a representation of a user's identity; it's a cryptographic construct. Utilizing the Abstract Account concept, it abstracts the relationship between signing keys and on-chain accounts. In essence, it allows for the creation of smart contract-based accounts, where the logic of transaction validation is embedded within the contract itself. This means that the validation logic can be customized, allowing for advanced features like multi-signature requirements, transaction rate limiting, or even more complex logic. By decoupling the signing process from the account's core identity, it provides a layer of indirection, enhancing security and flexibility.
CyberGraph is built upon decentralized storage solutions like IPFS and Ceramic. IPFS, or the InterPlanetary File System, is a protocol designed to create a peer-to-peer method of storing and sharing hypermedia in a distributed file system. When a piece of data is added to IPFS, it's given a unique cryptographic hash. CyberGraph leverages this by storing relationship data on IPFS and then referencing these hashes on Ceramic, a mutable layer built on top of IPFS. This ensures that while the underlying data remains immutable and tamper-proof, the references (like relationship links) can be updated, providing a dynamic yet secure social graph.
To address the inherent scalability challenges of blockchains, CyberNetwork employs a combination of on-chain and off-chain data storage. While essential data pointers and cryptographic proofs are stored on-chain to ensure data integrity and verifiability, the bulk of the social data is stored off-chain in distributed storage systems. This hybrid approach ensures rapid data retrieval and reduced transaction costs. Additionally, by using cryptographic techniques like Merkle Trees, CyberNetwork can batch multiple pieces of data into a single on-chain reference, further optimizing storage and retrieval processes.
III. CyberConnect Essentials
$CYBER serves some functions within the CyberConnect ecosystem. It acts as a governance token, allowing holders to participate in decision-making processes. Additionally, it's used as a payment method for acquiring CyberID and also functions as gas for operating CyberAccount.
The allocation of $CYBER tokens offers insights into the project's priorities. A significant 34% is set apart for Ecosystem Development. Within this, 10% is dedicated to the Developer Community, another 10% for Marketing, 9% for Ecosystem Partners, and 5% for Early Integration Partners. Such a detailed breakdown indicates a robust strategy to foster growth and collaboration. However, the massive size of this allocation might prompt discussions about the distribution of funds across the project and its various initiatives.
A 15% allocation for Team & Advisors is in line with industry norms. It's a clear indication that the people behind CyberConnect have a vested interest in its long-term success and growth.
The 9% dedicated to Community Rewards emphasizes CyberConnect's commitment to its user base and community engagement. It's a positive sign of recognizing and rewarding active participation.
$CYBER Vesting Schedule
Analyzing $CYBER's vesting schedule reveals some noteworthy points. As of now, a mere 11% of the total supply is in circulation, leaving a substantial 89% to be unlocked over the next five years. Such a distribution strategy might raise eyebrows among potential investors. A date of particular interest is 15 September 2023, when a significant 1.26M CYBER tokens, equating to 1.26% of the total supply and 11.4% of the current market cap, will be released. Given the volume, this could exert downward pressure on the token's price.
Recent Price Change
Recently, $CYBER experienced a dramatic price fluctuation that caught the attention of many in the crypto community. Starting from 29th August, the token saw a huge rise, surging from $3.7 to a staggering $16 in just a span of three days. This rapid ascent represented an increase of over 330% in its value. However, the hype was short-lived. Just a day after reaching its peak, $CYBER experienced a sharp correction, plummeting down to $6.5.
CyberConnect was established in 2021 by a team of visionary serial entrepreneurs. Their CEO, Wilson Wei, is not just a figurehead but an active participant in the broader Web3 community. He frequently engages in discussions about the transformative potential of Web3 and its implications for the future of social media. Furthermore, the founding members have a track record of success, having previously established DLive, a decentralized blockchain-based platform. With a global perspective, the startup operates out of Palo Alto but has a presence across the U.S., China, Canada, and Europe.
CyberConnect has garnered significant support from a range of backers. Among them, Multicoin Capital is known for its strategic investments in the crypto space, having backed several successful projects. Binance Labs, the venture arm of the world's largest cryptocurrency exchange, Binance, brings a wealth of industry connections and resources. Animoca Brands, on the other hand, is renowned for its pioneering work in blockchain gaming and NFTs. Delphi Digital is a respected name in crypto research and analysis, while Protocol Labs is the force behind projects like Filecoin and IPFS. The involvement of these esteemed entities not only showcases the trust they place in CyberConnect but also adds a layer of credibility to the project's vision and execution.
IV. Closing Thoughts
Decentralized social networks aim to change how we interact online. They prioritize users, giving them control over their data and promoting real connections. CyberConnect's goals reflect this shift towards a Web3 approach, which focuses on a more open and user-driven internet.
In my opinion, while CyberConnect presents a promising product in the decentralized space, there are certain aspects that give me pause. The lack of detailed information about the team and the absence of a clear roadmap in the project's official documents raise some concerns. Additionally, the vast amount of tokens set to be vested over the next five years and the limited use cases for $CYBER within the ecosystem make me cautious. I genuinely believe in the potential of their product, but when it comes to holding $CYBER, I'd tread carefully and consider various factors before making a decision.
As you and I explore CyberConnect further, we’re probably left wondering: How will platforms like this shape our online world in the future? The potential of Web3 is clear, and with CyberConnect at the forefront, there's much to look forward to. The next chapter of the digital age is just beginning, and it's exciting to think about what's ahead.