Web3 Anonymous Dating Unicorn XO: Dual-Driven by Personality Proof and AI Agents, Steadily Positioned at the Next Windfall

Author: Mensh, ChainCatcher

As a pioneer and gateway for large-scale Web3 applications, SocialFi has garnered widespread attention from users and investors. However, as a censorship-resistant and privacy-focused SocialFi, it faces real issues such as uneven content quality and fraud. While attracting users with flashy economic models like "X to earn," platforms lack the ability to continuously engage content creators, making it difficult for leading SocialFi protocols to break through the bottleneck of user numbers and prove market demand.

Farcaster's daily active user data over the past six months:

In contrast, the Web3 anonymous dating app XO has demonstrated real user demand with impressive data: in just over two years since its launch in 2022, users have naturally grown from zero to 1.5 million; Cyber L2 (the blockchain where XO is located) has a daily transaction volume exceeding 100,000; it generates 7 million clicks and 1 million matches monthly; 82% of users are acquired through organic growth or referrals; the 30-day retention rate reaches 15% (three times the industry standard); users spend an average of 40 minutes daily on XO (almost twice that of Facebook and Snapchat); AI agents are summoned over 100,000 times daily to facilitate interactions among users; the average revenue per paid user is $38 (1.7 times that of Bumble). The high user stickiness and willingness to pay behind these numbers prove that XO is meeting real social needs. How did this dark horse of SocialFi emerge?

Privacy First: Creating an Online Safe Space for Users

XO is an anonymous dating app. It features diverse chat topic boards, combining "anonymous chatting" and "community dating," allowing users to share mood stories and enhance interactions. With over 70% of users identifying as LGBTQ+, XO has thoughtfully created private communities that are invitation-only to foster a safe space for emotional expression and support. Carol, co-founder of XO, stated, "The original intention of XO is to create an anonymous safe space for modern people, where users can feel free to be themselves."

The flip side of privacy protection is security. XO employs multiple technical measures to prevent common issues of fraud and fake accounts in social media and dating apps. A decentralized user verification system provides verifiable credibility based on users' on-chain activities. When registering for XO, users receive a unique XO soul-bound token (XOUL) associated with an AA wallet. This token enhances online security through various verification methods (such as facial recognition, social network verification, ENS, and collaborations with DID providers).

Additionally, XO users can choose to connect their crypto wallets in account settings. Once a wallet is connected, if it has on-chain historical records, the app can verify the user's credibility through on-chain activities. Therefore, the number of social media followers, NFT ownership, companionship ratings within the XO app, and the content users publish will all contribute to their social credit score. The probability of fake accounts and bots appearing is significantly reduced.

For users with high social credit scores, XO also offers personalized AI twin services (Beta). This feature allows users to generate an AI "twin" to expand their social interaction capabilities and incentivize them to improve their credit scores.

Proof of Personhood serves as another layer of protection against fraud for XO. Proof of Personhood is a limited form of real-world identity that allows a given registered account to be controlled by a specific real person, verifying identity without revealing it.

In comparison to current decentralized identity (DID) solutions on the market, such as CyberID and Lens Protocol, which lack practical social application scenarios, existing products with real use cases have limited user data collection capabilities. As a passive content consumption platform similar to Twitter and Reddit, Farcaster's data scope mainly focuses on user content interactions. In contrast, XO, as an active social application, can collect richer user data, covering information such as gender, age, and preferences, fully leveraging the potential of Proof of Personhood in cross-platform applications, such as integrating Web2 data into Web3 applications to provide personalized services. This approach helps address the cold start problem and allows for more personalized recommendations for users. It also serves as a true foundation for user privacy protection.

Content Matching + AI Agents for Precise Dating

Unlike traditional dating apps that use profile-based swiping for matching, XO matches users based on the content they post (such as emotions, confessions, or lifestyles). This matching scheme not only allows users to choose whether to remain anonymous to protect their privacy but also continuously iterates based on user dynamics for more precise matching.

This year, XO launched an AI assistant feature, with the AI pet on the XO platform named ROO, which can conduct MBTI tests and provide customized feedback based on user responses. For users who are not good at chatting, the AI agent can also act as an "icebreaker" to ease awkward situations.

XO has revealed that it is testing an "AI Twin" feature, which allows users to create their own AI twin to simulate conversations before interacting with others, saving time in selecting conversation partners and helping them find suitable chat companions more quickly.

With over 4 million messages sent daily and more than 1 million matches monthly, XO has strong data-driven capabilities that can be used to build robust AI assistant and recommendation system models. Similar to how AWS supports Web2.0 applications, XO's AI foundation consists of multiple large language models (LLMs), which input information based on user profiles, tags, and stories into a 16K parameter LLM to summarize users' language styles, personality traits, and interests, conducting reinforcement learning from real data and integrating on-chain data, significantly reducing the time cost of making friends.

Sustainable Economic Model and Business Model

To avoid the "X to Earn" model being exploited by profit-seeking studios, XO first launched a Chat2Earn mechanism based on $rStar before officially introducing on-chain tokens, testing over 5 million chat records daily to detect potential algorithmic cheating behaviors and observing user reactions to earning in-app currency through chatting, exploring which behaviors and features users are willing to pay for or consume in-app tokens, ensuring the existence of a sustainable token economy with balanced income and expenditure.

Based on surveys and iterations, XO ultimately refined Chat2Earn. The underlying PoC (Proof-of-Companionship) algorithm assesses interaction quality based on user chatting behavior and provides virtual currency $rStar rewards. Users can enhance the health of chat rooms through deep chatting, quick replies, consecutive chatting days, AI game participation, etc., thereby triggering the reward mechanism.

Moreover, Chat2Earn combines with NFT and decentralized identity (DID) systems, allowing holders of XO partner NFTs to join exclusive Alpha communities and connect with other NFT holders. NFT holders also enjoy higher mining efficiency and unlock exclusive store features to redeem physical rewards with $rStar. Through visual feedback (such as changes in chat room background colors and gift airdrops), Chat2Earn not only enhances user experience but also forms a strong positive feedback mechanism, greatly stimulating user participation.

From an economic ecosystem perspective, $rStar is the core virtual currency of the platform but is non-tradable or withdrawable. This closed economic system ensures the flow and consumption cycle of currency within the ecosystem. In the third quarter of this year, XO launched $XO, linked to the $rStar system. Actively participating in community interactions or publishing content can earn $XO tokens. $XO holders do not have governance rights on the platform. Users can spend $XO to access over 1 million matching conversations monthly, and they can also spend $XO to connect with people who share their interests and values. The team also plans to use $XO as gas fees for accessing premium features, ensuring a smooth and efficient user experience.

Furthermore, XO has a very robust business model, which is why it secured $800,000 in seed funding from the renowned incubator TechStars, Japan's Rakutan Group, and the Taiwan government fund in its founding year. Currently, XO's revenue comes from both To C and To B segments.

The To C segment generates income for the platform through subscriptions, in-app purchases, advertising, and Chat2Earn. Users can obtain richer social features through paid subscriptions, enhance interaction experiences through in-app purchases of virtual goods, and earn token rewards by participating in the Chat2Earn mechanism. XO also provides unique digital assets and value-added services to users through NFT and virtual goods sales.

In the To B segment, XO offers customized market research and advertising services to brands through AI chat advertising and opinion mining, helping brands better understand and reach target users. Enterprises can also integrate with the Web3 ecosystem through the XO platform, utilizing NFTs and DAOs for brand promotion and user identity management, further enhancing brand exposure and user engagement, creating a win-win business ecosystem for multiple parties. Currently, XO has achieved comprehensive profitability.

Conclusion: Airdrop Approaching, SocialFi Dark Horse Leading a New Narrative in Social Interaction

On July 11, 2024, the Xoul DID mainnet officially launched, and the team announced a $1.2 million airdrop. The $XO token is also set to launch soon.

Looking to the future, XO is gradually implementing Proof of Personhood to help users build their decentralized identity (DID) through their interactive behaviors within the app. The team is actively seeking different Web3 partners, such as decentralized domain ENS and Web3 social identity IDs. XO hopes to truly integrate centralized identity systems into the dating scene.

At the same time, XO is also more broadly involved in fine-tuning AI agents, gradually developing them into decentralized autonomous chatbots to expand their influence more proactively on social platforms.

With a verified user base and driven by both Proof of Personhood and AI agents, XO is undoubtedly set to take SocialFi further.