Decentralizing Social Media: Investment Implications of Dorsey's Critique and Bitcoin-Inspired Models

The Problem with Centralized Social Media: Dorsey's Critique

Jack Dorsey, co-founder of Twitter and CEO of Block, has long argued that centralized social media platforms exploit users as "unpaid laborers." According to Benzinga, Dorsey claims that every user action-liking a post, searching on Google, or engaging with AI-feeds into algorithms designed to maximize ad revenue, effectively commodifying human behavior. He warns, in GBej, that this model locks user intelligence into a handful of corporations, which could eventually render human input obsolete as AI evolves. Dorsey's critique extends to the broader tech ecosystem, where he argues users are "programmed" by platforms that prioritize engagement over autonomy, a point explored in a Dev.to spotlight.

Bitcoin as a Foundation for Decentralization

Dorsey's vision for a decentralized internet is rooted in Bitcoin's principles: censorship resistance, open-source development, and individual sovereignty. At the 2024 Africa Bitcoin Conference, he emphasized that Bitcoin's decentralized ledger offers a blueprint for social media platforms where users own their data and are compensated via micropayments. Tools like BitChat, noted in a LinkedIn post, exemplify his push for off-grid, decentralized communication. By aligning social media with Bitcoin's ethos, Dorsey aims to create a system where value flows directly to creators, bypassing corporate intermediaries, as suggested by data on protocols such as LENS from CoinMun.

The Rise of Bitcoin-Inspired Decentralized Platforms

In 2025, decentralized social media platforms inspired by Bitcoin's model have gained traction, though they face distinct challenges. Bluesky, co-founded by Dorsey, has seen explosive growth, with its user base nearly doubling from 14.5 million in October 2024 to 25 million by December 2024 (as reported in the GBej profile). Its introduction of a premium subscription model (Bluesky+) and algorithmic feeds has enhanced monetization and user engagement (the Dev.to spotlight covers these developments). Meanwhile, Lens Protocol (operating on Solana) has attracted attention for its interoperable ecosystem, allowing creators to tokenize engagement and earn through dApps. The LENS token saw an 11.55% increase in Q3 2025, though volatility remains a concern (CoinMun provides token and market data).

Platforms like Steemit (Steem blockchain) and Mastodon (federated model) also highlight the diversity of decentralized approaches. Steemit rewards content creators with tokens, but its performance is tied to the volatility of its native cryptocurrency, a point raised in the GBej analysis. Mastodon, with 8.1 million users in early 2025, thrives on community-driven governance but struggles with scalability (the GBej piece discusses these trade-offs).

Financial Metrics: Centralized vs. Decentralized

Traditional platforms like Meta continue to dominate. In Q1 2025, Meta reported $42.31 billion in revenue, driven by 3.43 billion daily active users and a 16% year-over-year ad revenue increase, according to its Q1 2025 results. However, regulatory pressures in the EU and growing user dissatisfaction with content moderation policies pose risks. In contrast, decentralized platforms like Bluesky and Lens Protocol lack comparable revenue streams but offer unique value propositions. Bluesky's 30 million user target for 2025 hinges on its ability to monetize without compromising decentralization (LinkedIn coverage of BitChat and related initiatives discusses these ambitions).

Investment Risks and Opportunities

While decentralized platforms align with Dorsey's vision, they face significant hurdles. Technological risks include scalability issues and smart contract vulnerabilities, as seen in the April 2025 Bluesky outage noted in the Dev.to spotlight. Regulatory uncertainty looms large, with unclear guidelines on decentralized identifiers (DIDs) and tokenized rewards (LinkedIn commentary raises these concerns). Monetization challenges persist, as platforms must balance user autonomy with revenue generation-whether through premium services, NFTs, or tokenized subscriptions (the GBej article examines these monetization paths).

Conversely, the DeFi ecosystem's growth (e.g., TVL metrics) suggests a market ready to embrace decentralized models, as the BIS paper outlines. Bluesky's 35 million user milestone and Lens Protocol's partnerships with dApps indicate potential for long-term adoption (the Dev.to spotlight and CoinMun data provide further context).

Conclusion: A Hybrid Future?

The social media landscape in 2025 is a battleground between centralized giants and decentralized innovators. Dorsey's critique underscores a fundamental shift: users are no longer content to be exploited as free labor. While platforms like Meta leverage scale and regulatory muscle, decentralized alternatives offer privacy, transparency, and user sovereignty. For investors, the key lies in balancing the risks of nascent technologies with the disruptive potential of Bitcoin-inspired models. As Dorsey himself noted, the future of social media may not be a zero-sum game but a hybrid ecosystem where both models coexist-each evolving to meet the demands of a user base increasingly unwilling to trade autonomy for convenience. Benzinga and the BIS paper provide useful perspectives on these dynamics.