- Farcaster won’t shut down; Merkle will return investor funds after five years of funding and development.
- Neynar takes over Farcaster’s code, app, smart contracts, and AI launchpad, shifting focus to builders.
- Web3 apps like Bitchat gain popularity amid shutdowns, showing demand for decentralized, offline messaging tools.
Farcaster co-founder Dan Romero has announced plans to return investor capital. The decision came amid speculation about the platform’s future. Romero clarified, “Farcaster is not shutting down,” stressing the protocol remains fully operational.
The platform reported roughly 250,000 monthly active users in December and over 100,000 funded wallets. Several investors, including former Coinbase executive Balaji Srinivasan, confirmed the repayment plan. Hence, the move signals Merkle’s commitment to responsible stewardship of funds raised over five years.
The announcement follows Farcaster’s acquisition by Neynar, a venture-backed startup that has long developed infrastructure for the protocol. Under the deal, Neynar will take control of smart contracts, code repositories, the mobile application, and Clanker, an AI-driven token launchpad.
Romero and co-founder Varun Srinivasan, along with parts of the Merkle team, will step away from day-to-day development. “This wasn’t an easy decision,” Romero said. “But after five years, it’s clear Farcaster needs a new approach and leadership to reach its full potential.”
Strategic Pivot to Developer Focus
Farcaster launched with ambitions to decentralize social media, giving users control over their data and identities. Moreover, it raised $150 million in 2024 from top crypto venture firms, including Paradigm and Andreessen Horowitz’s crypto arm. However, the platform struggled to grow sustainably as a social-first product.
In December, the team shifted focus to in-app wallets and trading tools instead of trying to compete with big social networks. Neynar now plans to concentrate on building tools and resources for developers, making Farcaster more useful for people creating apps on the platform rather than everyday social users.
Web3 Social Platforms Gain Traction Globally
Besides Farcaster, Web3 messaging tools are rising amid political unrest. Bitchat, an offline messaging app from Twitter co-founder Jack Dorsey, surged in Uganda after government internet shutdowns. Downloads nearly quadrupled in recent months, and similar spikes occurred in Iran.
Additionally, Bitchat operates without internet, using Bluetooth mesh to relay messages between nearby devices. Hence, decentralized and offline social tools are increasingly vital as users seek resilient communication options.
