On-chain social capital is the killer app for Web3.
It offers a new perspective on human relationships that allows for more accurate representations of relationships where each person has specific qualities, abilities, and assets that they’re willing to share with others.
On-Chain Social Capital (OCSC) is a paradigm of social networking that encourages users to create and curate content, share information, and earn rewards by building the value of OCSC enabling tokens and societies on the Ethereum blockchain.
On-Chain Social Capital As A Feature
OCSC can be used as a mechanism for generating growth, organic hierarchies, and collaboration within communities without reliance on traditional resources, outside the reach of formal social systems. Its potential to create sustainable livelihoods, and improve efficiency by generating trust among members of networks without requiring high levels of interactions or tapping into obsolete social mores and structures, make OCSC a disruptive force.
In its most practical form, users earn social status by staking tokens to unlock encoded content, with public transaction records serving as an independently verifiable leaderboard. In some systems, once you’ve earned enough tokens, you can trade them in for items like VIP benefits or limited edition badges.
Proof of early access and interest in a high OCSC token — Loot, for example — actually generates more social proof than the volume of ownership. The social capital is directly related to your proximity to the origin of the token.
There are recognizable risks. Token holders could conceivably game the system to gain more social capital through their purchasing power, reproducing existing biases and inequalities in on-chain interactions. However, this is really just an extension of the ongoing risk facing Web3; If we cannot make conscious decisions to abandon flawed structures and systems, we will recreate them to our detriment and the detriment of the entire ecosystem.
The publicly verifiable properties of OCSC and the ability to determine the chain of token ownership mean that it’s far easier to see who has a natural place in a particular token’s community and who has bought their way in. IE; if you’re an early adopter who can point to your acquisition of a token at mint, you will always have more OCSC than if you’re a cashed-up celebrity buying in at scale.
On-chain Social Capital enables anyone to generate value by building their social capital, a valuable and verifiable asset. It’s up to the user community as to how this will be used: whether it’ll facilitate growth through collaboration or fracture nascent tribes through self-promotion remains an open question for now.