Paradigm’s funding takes Farcaster’s dev to unicorn status
Merkle Manufacturing, the company behind the social network Farcaster, is set to raise a new round of funding to raise $1 billion, according to a Bloomberg report, citing sources familiar with the matter.
The round is led by crypto investment firm Paradigm, whose portfolio includes major crypto firms such as Coinbase, Blur, dYdX, Compound and Citadel Securities.
Merkle was founded in 2020 by former Coinbase executives Dan Romero and Varun Srinivasan. The company's flagship social media app is Warpcast, a social media app built on the Farcaster decentralized network.
Romero confirmed in a March 28 tweet that Merck is raising capital. “I just wanted to let everyone know that Merkel Manufacturing is closing a new round of financing.” Paradigm has not confirmed his involvement. Merkel raised $30 million from venture capital firm A16z Crypto in July 2022.
The Farcaster platform has seen a significant jump in user activity since January, following the introduction of WarpCast Frames, a feature that allows apps to work within posts without leaving the platform. For example, Frames allows users to create non-fungible tokens (NFTs), make transactions, access external blog posts, and respond to surveys directly within the app.
The update has significantly increased user engagement. According to data from Dune Analytics, the number of daily active users on the Farcaster network increased from about 5,000 on January 28 to 249,000 on March 30.
Decentralized social media platforms are new parts of the network that use blockchain technology to provide ownership over their data, content, and interactions, moving away from the centralized control found in traditional social media.
These platforms are characterized by features such as censorship resistance and content monetization without intermediaries. Notable names in this sector include Friend.tech, Minds and Mastodon. According to two industry executives, one of the challenges facing decentralized social media platforms is user retention.
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