Capsule Secures Seed Funding for Decentralized Social Media Platform

Capsule’s development of a highly streamlined, decentralized social media platform – designed to resist censorship from major technology companies – has reached a significant milestone. The startup has successfully completed a seed funding round, raising $1.5 million, with Beacon Fund, a crypto-focused fund managed by Polychain Capital, leading the investment.

Investment Details and Background

Polychain Capital’s Beacon Fund specifically invests in startups leveraging Dfinity’s decentralized network for the creation of next-generation ‘open’ applications, often referred to as the Internet Computer.

The project originated from a single tweet earlier this year, quickly attracting a $100,000 pre-seed investment. This initial funding has now been augmented by the recent seed financing, intended to facilitate the release of a prototype later this month.

Plans include the development of mobile applications, and the secured funds will also be allocated to expanding the Capsule team, which currently comprises approximately four individuals.

Prototype Launch and Technological Considerations

Capsule founder, Nadim Kobeissi, a cryptography researcher and the creator of the open-source, end-to-end encrypted chat application Cryptocat, confirms they are on schedule to launch a Minimum Viable Product (MVP) this month.

“The prototype is currently finalized,” Kobeissi stated to TechCrunch. “We are evaluating a transition of some infrastructure components from GUN to IPFS (InterPlanetary File System), a peer-to-peer hypermedia protocol, and refining the user interface. While an MVP launch is feasible now, we’ve opted to delay it by a few weeks to incorporate these improvements.”

The Internet Computer and Capsule’s Architecture

Polychain Capital introduced its Beacon Fund last September. This $14.5 million fund receives backing from Polychain, Andreessen Horowitz, and the Dfinity Foundation, with the goal of supporting entrepreneurs building on the Internet Computer (TIC).

The Internet Computer is described as a serverless architecture designed for natively hosting software and services, functioning as what Dfinity terms the “first blockchain computer that runs at web speed with infinite capacity.”

Kobeissi’s initial vision for Capsule centered around creating self-hosting microservices, a concept that remains unchanged. However, he recognizes the potential of the Internet Computer to address specific technical challenges.

“We anticipate that the Internet Computer will assist us in constructing a ‘customized mini-blockchain’ to address two key issues within Capsule: globally authenticated timestamps for posts and a secure root of trust for user authentication keys,” he explained. “We were already exploring solutions to these problems prior to this investment and considered Dfinity a viable option due to its programming language, which enables the creation of these ‘custom mini-blockchains’ as we envision them.”

“The remaining components will continue to utilize a self-hosting, self-contained, and meticulously engineered micro-services approach, with IPFS (formerly GUN) serving as the decentralized database and connectivity back-end,” he added.

Decentralized Social Media Landscape

Given the Internet Computer’s capacity to host diverse decentralized applications, the emergence of numerous decentralized social media platforms is anticipated. Last year, Dfinity showcased a proof-of-concept for an ‘open’ version of LinkedIn, playfully named ‘LinkedUp’.

Furthermore, a TikTok clone was demonstrated, and the Internet Computer was opened to external developers last summer. This could lead to a proliferation of applications built on its network, offering social networking services free from the control of large technology companies.

Capsule’s Unique Selling Proposition

Considering this potential landscape, the question arises: what distinguishes Capsule – its Unique Selling Proposition (USP) – especially if a multitude of decentralized ‘mega-apps’ also claim censorship resistance?

“We believe Capsule’s strength will reside in its exceptional user experience, quality, performance, ease of use, and superior engineering, leveraging advanced technologies like the Internet Computer and IPFS without introducing unnecessary complexity,” Kobeissi stated. “While others may employ the same technologies, we are confident in our ability to create a simple, functional, and enjoyable user experience.”

“Ultimately, I envision Capsule as representing to Facebook what a healthy, vegetarian diet represents to a McDonald’s diet,” he continued, outlining his broader vision for the service. “Capsule is a social media service, but its relationship with its users and developers will fundamentally differ from that of Big Tech platforms.”

Mock-ups of the Capsule interface are available below.