Web3 Social: Still Dominated by the Chinese Community

Written by: David, Deep Tide TechFlow

Within two days, two decentralized social protocols changed hands.

On January 20th, Lens Protocol announced it would be taken over by Mask Network. On January 21st, Farcaster announced it had been acquired by Neynar, one of its clients.

Combined, these two protocols have raised over $200 million. Farcaster was valued at $1 billion last year, with investors including a16z and Paradigm. Behind Lens is DeFi giant Aave.

Now, the founders have all "stepped down from daily operations to work on new projects."

Counting Steem, another well-known project acquired by Tron in 2020, two out of these three phenomenal decentralized social protocols have now been taken over by Chinese teams.

You may have already forgotten about Steem. It was the pioneer of "write-to-mine" launched in 2016, and at its peak was the benchmark project for the entire Web3 social sector. After being acquired by Justin Sun, the community forked and left—more on this later.

Mask Network, which took over Lens, was founded by Suji Yan. Chinese, dropped out of UIUC at age 20 to start a business, previously contributed articles to Caixin and Jiemian.

Founded Mask in 2017, focusing on layering Web3 features onto traditional social platforms like Twitter.

Over the past few years, Mask has been actively acquiring: in 2022, acquiring two major Japanese Mastodon instances; last year, buying Orb, the most active client on Lens; and now, taking over Lens itself.

Suji Yan positions himself as "the Tencent of Web3."

On the Farcaster side, the new owners Neynar are two Indian founders, both former Coinbase employees. But out of the three protocols, two being taken over by Chinese teams remains a fact.

Why the Chinese?

One possible explanation is capability endowment. The two most successful countries in building social products globally are the US and China. WeChat, TikTok, Xiaohongshu—Chinese teams have proven they can build social platforms for billions of users.

But this explanation is flawed. Building products and acquiring protocols are not the same. Protocols are infrastructure, not directly facing users. You can build products on top, but the protocol itself doesn't create user experience.

Another reasonable explanation is price.

Look at Justin Sun’s acquisition list: $140 million for BitTorrent in 2018, Poloniex in 2019, Steemit in 2020, HTX in 2022.

These targets have something in common:

All once had their glory days but are now on the decline. BitTorrent was the pioneer of P2P downloads, Poloniex was once a leading US exchange, and HTX was once one of China's top three exchanges.

Justin Sun doesn't buy the best, but the best bargains.

Now, Farcaster is valued at $1 billion but its monthly revenue has dropped to $10,000, a year-on-year decline of more than 95%. Founder Dan Romero admitted in a post last month, "After four and a half years of trying a social-first approach, it didn't work out";

Lens has only 50,000 monthly active users, and the Aave team wants to let go to focus on its core DeFi business.

The most valuable days of these protocols are over, but their technology and brands remain. In A-share stock market terms, this is called:

Value has emerged after the drop.

There’s also a subtler extension of thought: in the West, decentralized social is a belief; in China, it’s a business.

Western founders in this space are somewhat idealistic. Users should own their data, social graphs should be portable, platforms shouldn’t have censorship rights... Farcaster’s slogan is "able decentralized," Lens is "user-owned social."

But after five years, users don’t care.

Ordinary people don’t care about data ownership or whether their social graphs are portable. They care about whether there’s anyone to chat with, interesting content, or associated assets that can skyrocket in value.

Chinese buyers taking over is, to some extent, handing this business from idealists to pragmatists.

Suji Yan said what Mask wants to do is "bring decentralized social out of the lab and into everyday life." In other words:

Forget ideals for now, let’s get people to use it first.

Of course, the last time the Chinese acquired a decentralized social protocol, the outcome wasn’t great.

In 2020, Justin Sun bought Steem. After the acquisition, he joined forces with exchanges to gain control of Steem’s network governance, but the original community responded by collectively forking to create a new chain, Hive, using code to exclude Justin Sun’s wallet.

Forking is the most extreme form of protest in the blockchain world. “We’re not playing with you anymore, we’re copying the code and leaving.”

Now Steemit is still running, but most active users have long since moved to Hive.

So here’s the question: will this time be different?

Mask taking over Lens, the official term used is "stewardship," not acquisition. The founders will continue as advisors, and the protocol remains open.

But the very fact that a "decentralized protocol" can be acquired already says something. Contracts can be transferred, codebases can be transferred, apps can be transferred. So where is the "decentralization"?

Disenchantment reveals that decentralization is just a technological architecture, not a business model. Technically decentralized, but commercially, someone still calls the shots.

After the leadership change at Lens, Vitalik posted that every post he made in 2026 was through Firefly, a multi-platform client under Mask Network.

He also said, "If we want a better society, we need better mass communication tools."

That’s not wrong. But who builds this tool, who operates it, who decides what it looks like—decentralization hasn’t answered these questions.

Now, the answer may be that it’s built by the Chinese.

However, maybe nothing will happen. After all, there aren’t many active users left anyway.