diff --git a/package.json b/package.json
index 8c27d50d273..4c85ffeab24 100644
--- a/package.json
+++ b/package.json
@@ -13,7 +13,7 @@
     "start:prod": "NODE_ENV=production node build/server.js"
   },
   "dependencies": {
-    "@ecency/ns-query": "^1.1.8",
+    "@ecency/ns-query": "^1.2.3",
     "@ecency/render-helper": "^2.2.32",
     "@ecency/render-helper-amp": "^1.1.0",
     "@emoji-mart/data": "^1.1.2",
diff --git a/src/common/app.tsx b/src/common/app.tsx
index 54c52d2dc10..cc3cc475f31 100644
--- a/src/common/app.tsx
+++ b/src/common/app.tsx
@@ -121,6 +121,7 @@ const App = (props: any) => {
         <Tracker />
         <UserActivityRecorder />
         <ChatContextProvider
+          storage={typeof window !== "undefined" ? window.localStorage : undefined}
           privateApiHost={defaults.base}
           activeUsername={activeUser?.username}
           activeUserData={activeUserAccount}
diff --git a/src/common/features/chats/components/chat-floating-date.tsx b/src/common/features/chats/components/chat-floating-date.tsx
index 9b77b6c93cb..e6a84d80c25 100644
--- a/src/common/features/chats/components/chat-floating-date.tsx
+++ b/src/common/features/chats/components/chat-floating-date.tsx
@@ -30,7 +30,7 @@ export function ChatFloatingDate({
         "top-[180px] md:top-[57px]": isPage
       })}
     >
-      <div className="bg-gray-200 my-3 dark:bg-gray-800 rounded-full p-1 ">
+      <div className="bg-gray-200 my-3 dark:bg-gray-800 rounded-full p-1 max-w-[100px] min-w-[100px] truncate">
         {currentFormattedDate}
       </div>
     </div>
diff --git a/src/common/features/chats/components/chat-popup/chat-popup-contacts-and-channels.tsx b/src/common/features/chats/components/chat-popup/chat-popup-contacts-and-channels.tsx
index 3cc0e786453..ef75f77a416 100644
--- a/src/common/features/chats/components/chat-popup/chat-popup-contacts-and-channels.tsx
+++ b/src/common/features/chats/components/chat-popup/chat-popup-contacts-and-channels.tsx
@@ -5,6 +5,7 @@ import { Button } from "@ui/button";
 import { useChannelsQuery, useDirectContactsQuery, useKeysQuery } from "@ecency/ns-query";
 import { ChatSidebarDirectContact } from "../chats-sidebar/chat-sidebar-direct-contact";
 import { ChatSidebarChannel } from "../chats-sidebar/chat-sidebar-channel";
+import { useComposedContactsAndChannelsQuery } from "../../queries";
 
 interface Props {
   communityClicked: (v: string) => void;
@@ -18,44 +19,35 @@ export function ChatPopupContactsAndChannels({
   setShowSearchUser
 }: Props) {
   const { privateKey } = useKeysQuery();
+
   const { data: directContacts } = useDirectContactsQuery();
   const { data: channels } = useChannelsQuery();
+  const composedContactsAndChannels = useComposedContactsAndChannelsQuery();
 
   return (
     <>
       {(directContacts?.length !== 0 || (channels?.length !== 0 && channels?.length !== 0)) &&
       privateKey ? (
         <>
-          {channels?.length !== 0 && (
-            <>
-              <div className="px-3 pt-3 pb-2 text-xs uppercase font-bold text-gray-500">
-                {_t("chat.communities")}
-              </div>
-              {channels?.map((channel) => (
-                <ChatSidebarChannel
-                  isChannel={false}
-                  key={channel.id}
-                  channel={channel}
-                  username={channel.communityName!!}
-                  onClick={() => communityClicked(channel.communityName!)}
-                  isLink={false}
-                />
-              ))}
-              {directContacts?.length !== 0 && (
-                <div className="px-3 pt-3 pb-2 text-xs uppercase font-bold text-gray-500">
-                  {_t("chat.dms")}
-                </div>
-              )}
-            </>
+          {composedContactsAndChannels.map((contactOrChannel) =>
+            "id" in contactOrChannel ? (
+              <ChatSidebarChannel
+                isChannel={false}
+                key={contactOrChannel.id}
+                channel={contactOrChannel}
+                username={contactOrChannel.communityName!!}
+                onClick={() => communityClicked(contactOrChannel.communityName!)}
+                isLink={false}
+              />
+            ) : (
+              <ChatSidebarDirectContact
+                isLink={false}
+                contact={contactOrChannel}
+                onClick={() => userClicked(contactOrChannel.name)}
+                key={contactOrChannel.pubkey}
+              />
+            )
           )}
-          {directContacts?.map((user) => (
-            <ChatSidebarDirectContact
-              isLink={false}
-              contact={user}
-              onClick={() => userClicked(user.name)}
-              key={user.pubkey}
-            />
-          ))}
         </>
       ) : !privateKey ? (
         <ChatsWelcome />
diff --git a/src/common/features/chats/components/chats-sidebar/chat-sidebar-channel.tsx b/src/common/features/chats/components/chats-sidebar/chat-sidebar-channel.tsx
index 972cbd19e86..70f50319385 100644
--- a/src/common/features/chats/components/chats-sidebar/chat-sidebar-channel.tsx
+++ b/src/common/features/chats/components/chats-sidebar/chat-sidebar-channel.tsx
@@ -13,6 +13,7 @@ import {
 import { _t } from "../../../../i18n";
 import { Badge } from "@ui/badge";
 import { useCommunityCache } from "../../../../core";
+import { UilUsersAlt } from "@iconscout/react-unicons";
 
 interface Props {
   username: string;
@@ -42,6 +43,9 @@ export function ChatSidebarChannel({
   const content = (
     <>
       <UserAvatar username={channel.communityName!} size="medium" />
+      <div className="absolute bottom-2.5 left-2.5 w-5 h-5 text-blue-dark-sky flex items-center justify-center rounded-full bg-white">
+        <UilUsersAlt size={14} />
+      </div>
       <div className="flex flex-col w-[calc(100%-40px-0.75rem)]">
         <div className="flex justify-between w-full items-center">
           <div className="font-semibold truncate dark:text-white">{channel.name}</div>
@@ -63,7 +67,7 @@ export function ChatSidebarChannel({
   return isLink ? (
     <Link
       className={classNameObject({
-        "flex items-center text-dark-200 gap-3 p-3 border-b border-[--border-color] last:border-0 hover:bg-gray-100 dark:hover:bg-gray-800":
+        "flex items-center relative text-dark-200 gap-3 p-3 border-b border-[--border-color] last:border-0 hover:bg-gray-100 dark:hover:bg-gray-800":
           true,
         "bg-gray-100 dark:bg-gray-800": rawUsername === channel.communityName && isChannel
       })}
@@ -81,7 +85,7 @@ export function ChatSidebarChannel({
   ) : (
     <div
       className={classNameObject({
-        "flex items-center text-dark-200 gap-3 p-3 border-b border-[--border-color] last:border-0 hover:bg-gray-100 dark:hover:bg-gray-800":
+        "flex items-center relative text-dark-200 gap-3 p-3 border-b border-[--border-color] last:border-0 hover:bg-gray-100 dark:hover:bg-gray-800":
           true,
         "bg-gray-100 dark:bg-gray-800": rawUsername === channel.communityName && isChannel
       })}
diff --git a/src/common/features/chats/components/chats-sidebar/chat-sidebar-direct-contact.tsx b/src/common/features/chats/components/chats-sidebar/chat-sidebar-direct-contact.tsx
index 8080071294c..2d5f0fd05dc 100644
--- a/src/common/features/chats/components/chats-sidebar/chat-sidebar-direct-contact.tsx
+++ b/src/common/features/chats/components/chats-sidebar/chat-sidebar-direct-contact.tsx
@@ -134,6 +134,7 @@ export function ChatSidebarDirectContact({ contact, onClick, isLink = true }: Pr
 
   return (
     <Dropdown
+      className="border-b border-[--border-color] last:border-0"
       closeOnClickOutside={true}
       show={showContextMenu}
       setShow={(v) => setShowContextMenu(v)}
@@ -162,7 +163,6 @@ export function ChatSidebarDirectContact({ contact, onClick, isLink = true }: Pr
         onTouchStart={() => setHoldStarted(true)}
         onTouchEnd={() => {
           setHoldStarted(false);
-          console.log("touch ended");
 
           setTimeout(() => {
             if (!holdStarted) {
@@ -186,7 +186,7 @@ export function ChatSidebarDirectContact({ contact, onClick, isLink = true }: Pr
           setShowContextMenu(true);
         }}
         className={classNameObject({
-          "flex items-center text-dark-200 gap-3 p-3 border-b border-[--border-color] last:border-0 hover:bg-gray-100 dark:hover:bg-gray-800 cursor-pointer":
+          "flex items-center text-dark-200 gap-3 p-3 last:border-0 hover:bg-gray-100 dark:hover:bg-gray-800 cursor-pointer":
             true,
           "bg-gray-100 dark:bg-gray-800": receiverPubKey === contact.pubkey
         })}
diff --git a/src/common/features/chats/components/chats-sidebar/index.tsx b/src/common/features/chats/components/chats-sidebar/index.tsx
index e8e74c6ccda..9b0a1bd53da 100644
--- a/src/common/features/chats/components/chats-sidebar/index.tsx
+++ b/src/common/features/chats/components/chats-sidebar/index.tsx
@@ -12,7 +12,7 @@ import {
   useChannelsQuery,
   useDirectContactsQuery
 } from "@ecency/ns-query";
-import { useSearchUsersQuery } from "../../queries";
+import { useComposedContactsAndChannelsQuery, useSearchUsersQuery } from "../../queries";
 import { useSearchCommunitiesQuery } from "../../queries/search-communities-query";
 import { Community } from "../../../../store/communities";
 import { Reputations } from "../../../../api/hive";
@@ -32,6 +32,7 @@ export default function ChatsSideBar(props: Props) {
 
   const { data: directContacts } = useDirectContactsQuery();
   const { data: channels } = useChannelsQuery();
+  const composedContactsAndChannels = useComposedContactsAndChannelsQuery();
   const chatsSideBarRef = React.createRef<HTMLDivElement>();
 
   const [selectedAccount, setSelectedAccount] = useState("");
@@ -75,27 +76,22 @@ export default function ChatsSideBar(props: Props) {
           ))
         ) : (
           <>
-            {channels?.length !== 0 && (
-              <div className="mt-4 mb-2 text-xs font-semibold text-gray-500 uppercase px-3">
-                {_t("chat.communities")}
-              </div>
+            {composedContactsAndChannels.map((contactOrChannel) =>
+              "id" in contactOrChannel ? (
+                <ChatSidebarChannel
+                  isChannel={props.isChannel}
+                  key={contactOrChannel.id}
+                  channel={contactOrChannel}
+                  username={username}
+                />
+              ) : (
+                <ChatSidebarDirectContact
+                  isLink={true}
+                  key={contactOrChannel.pubkey}
+                  contact={contactOrChannel}
+                />
+              )
             )}
-            {channels?.map((channel) => (
-              <ChatSidebarChannel
-                isChannel={props.isChannel}
-                key={channel.id}
-                channel={channel}
-                username={username}
-              />
-            ))}
-            {directContacts?.length !== 0 && (
-              <div className="mt-4 mb-2 text-xs font-semibold text-gray-500 uppercase px-3">
-                {_t("chat.direct-messages")}
-              </div>
-            )}
-            {directContacts?.map((contact) => (
-              <ChatSidebarDirectContact isLink={true} key={contact.pubkey} contact={contact} />
-            ))}
           </>
         )}
       </div>
diff --git a/src/common/features/chats/queries/composed-contacts-and-channels-query.ts b/src/common/features/chats/queries/composed-contacts-and-channels-query.ts
new file mode 100644
index 00000000000..ce41cbfeb64
--- /dev/null
+++ b/src/common/features/chats/queries/composed-contacts-and-channels-query.ts
@@ -0,0 +1,73 @@
+import {
+  useChannelsQuery,
+  useDirectContactsQuery,
+  useKeysQuery,
+  useNostrGetUserProfileQuery
+} from "@ecency/ns-query";
+import { useMemo } from "react";
+import { isAfter } from "date-fns";
+
+export function useComposedContactsAndChannelsQuery() {
+  const { publicKey } = useKeysQuery();
+  const { data: contactsData } = useDirectContactsQuery();
+  const { data: channelsData } = useChannelsQuery();
+
+  const { data: activeUserNostrProfiles } = useNostrGetUserProfileQuery(publicKey);
+
+  const channelsLastSeenDate = useMemo(
+    () =>
+      channelsData.reduce<Record<string, Date>>((acc, channel) => {
+        if (activeUserNostrProfiles?.[0] && channel) {
+          const channelsLastSeenTimestamps =
+            activeUserNostrProfiles?.[0].channelsLastSeenDate ?? {};
+          const lastSeenTimestamp = channelsLastSeenTimestamps[channel.id];
+          return {
+            ...acc,
+            [channel.id]: lastSeenTimestamp
+          };
+        }
+        return acc;
+      }, {}),
+    [channelsData, activeUserNostrProfiles]
+  );
+
+  return useMemo(
+    () =>
+      [...(contactsData ?? []), ...channelsData]
+        .sort((a, b) => {
+          let lastSeenDateA: Date | undefined;
+          if ("lastSeenDate" in a) {
+            lastSeenDateA = a.lastSeenDate;
+          } else if ("id" in a) {
+            lastSeenDateA = channelsLastSeenDate[a.id];
+          }
+
+          let lastSeenDateB: Date | undefined;
+          if ("lastSeenDate" in b) {
+            lastSeenDateB = b.lastSeenDate;
+          } else if ("id" in b) {
+            lastSeenDateB = channelsLastSeenDate[b.id];
+          }
+
+          if (
+            lastSeenDateA instanceof Date &&
+            lastSeenDateB instanceof Date &&
+            isAfter(lastSeenDateA, lastSeenDateB)
+          ) {
+            return -1;
+          }
+          return 0;
+        })
+        .sort((a, b) => {
+          if ("pinned" in a && "pinned" in b) {
+            return +(b.pinned ?? false) - +(a.pinned ?? false);
+          } else if ("pinned" in a) {
+            return -1;
+          } else if ("pinned" in b) {
+            return 1;
+          }
+          return 0;
+        }),
+    [contactsData, channelsData, channelsLastSeenDate]
+  );
+}
diff --git a/src/common/features/chats/queries/index.ts b/src/common/features/chats/queries/index.ts
index a25d33f77de..8d31b3adf8a 100644
--- a/src/common/features/chats/queries/index.ts
+++ b/src/common/features/chats/queries/index.ts
@@ -1 +1,2 @@
 export * from "./search-users-query";
+export * from "./composed-contacts-and-channels-query";
diff --git a/yarn.lock b/yarn.lock
index 742c84d7524..28195478ce3 100644
--- a/yarn.lock
+++ b/yarn.lock
@@ -1381,18 +1381,16 @@
   resolved "https://registry.yarnpkg.com/@discoveryjs/json-ext/-/json-ext-0.5.7.tgz#1d572bfbbe14b7704e0ba0f39b74815b84870d70"
   integrity sha512-dBVuXR082gk3jsFp7Rd/JI4kytwGHecnCoTtXFb7DB6CNHp4rg5k1bhg0nWdLGLnOV71lmDzGQaLMy8iPLY0pw==
 
-"@ecency/ns-query@^1.1.8":
-  version "1.1.8"
-  resolved "https://registry.yarnpkg.com/@ecency/ns-query/-/ns-query-1.1.8.tgz#5e224c5aa0116f143a0734fc3723916e10ca90f3"
-  integrity sha512-EEIEsPlKmHr3UyrOSk9/d8TbcrUeCdvqFYb+2TVdIJOQKYJA4YB2z4AWjUfIafbYpX/XAnP6aDH6ZqrPaKRSlA==
+"@ecency/ns-query@^1.2.3":
+  version "1.2.3"
+  resolved "https://registry.yarnpkg.com/@ecency/ns-query/-/ns-query-1.2.3.tgz#057ec5d77fc5b379d05743bcd95f44971e19d2b1"
+  integrity sha512-5WiEmOlDu50ceeBdQkphhhMOggtdU/v2LOb832qTwUG6hrCj0YecU37uxDpGKYW4zIk3u5D4BKBZZR8BxCHTuA==
   dependencies:
     "@tanstack/react-query" "^4.29.7"
     axios "^0.21.2"
     date-fns "^2.30.0"
     nostr-tools "^1.17.0"
     react "^16.8.6"
-    react-dom "^16.8.6"
-    react-use "^17.4.1"
 
 "@ecency/render-helper-amp@^1.1.0":
   version "1.1.0"
@@ -1893,7 +1891,7 @@
   resolved "https://registry.yarnpkg.com/@jridgewell/sourcemap-codec/-/sourcemap-codec-1.4.13.tgz#b6461fb0c2964356c469e115f504c95ad97ab88c"
   integrity sha512-GryiOJmNcWbovBxTfZSF71V/mXbgcV3MewDe3kIMCLyIh5e7SKAeUZs+rMnJ8jkMolZ/4/VsdBmMrw3l+VdZ3w==
 
-"@jridgewell/sourcemap-codec@^1.4.14", "@jridgewell/sourcemap-codec@^1.4.15":
+"@jridgewell/sourcemap-codec@^1.4.14":
   version "1.4.15"
   resolved "https://registry.yarnpkg.com/@jridgewell/sourcemap-codec/-/sourcemap-codec-1.4.15.tgz#d7c6e6755c78567a951e04ab52ef0fd26de59f32"
   integrity sha512-eF2rxCRulEKXHTRiDrDy6erMYWqNw4LPdQ8UQA4huuxaQsVeRPFl2oM8oDGxMFhJUWZf9McpLtJasDDZb/Bpeg==
@@ -5003,11 +5001,6 @@ csstype@^3.0.6:
   resolved "https://registry.yarnpkg.com/csstype/-/csstype-3.1.1.tgz#841b532c45c758ee546a11d5bd7b7b473c8c30b9"
   integrity sha512-DJR/VvkAvSZW9bTouZue2sSxDwdTN92uHjqeKVm+0dAqdfNykRzQ95tay8aXMBAAPpUiq4Qcug2L7neoRh2Egw==
 
-csstype@^3.1.2:
-  version "3.1.2"
-  resolved "https://registry.yarnpkg.com/csstype/-/csstype-3.1.2.tgz#1d4bf9d572f11c14031f0436e1c10bc1f571f50b"
-  integrity sha512-I7K1Uu0MBPzaFKg4nI5Q7Vs2t+3gWWW648spaF+Rg7pI9ds18Ugn+lvg4SHczUdKlHI5LWBXyqfS8+DufyBsgQ==
-
 currency-symbol-map@^4.0.4:
   version "4.0.4"
   resolved "https://registry.yarnpkg.com/currency-symbol-map/-/currency-symbol-map-4.0.4.tgz#3cfba625974dd3f86822d327ecbd10248695e95e"
@@ -7109,14 +7102,6 @@ inline-style-prefixer@^6.0.0:
     css-in-js-utils "^3.1.0"
     fast-loops "^1.1.3"
 
-inline-style-prefixer@^7.0.0:
-  version "7.0.0"
-  resolved "https://registry.yarnpkg.com/inline-style-prefixer/-/inline-style-prefixer-7.0.0.tgz#991d550735d42069f528ac1bcdacd378d1305442"
-  integrity sha512-I7GEdScunP1dQ6IM2mQWh6v0mOYdYmH3Bp31UecKdrcUgcURTcctSe1IECdUznSHKSmsHtjrT3CwCPI1pyxfUQ==
-  dependencies:
-    css-in-js-utils "^3.1.0"
-    fast-loops "^1.1.3"
-
 inquirer@7.0.4:
   version "7.0.4"
   resolved "https://registry.yarnpkg.com/inquirer/-/inquirer-7.0.4.tgz#99af5bde47153abca23f5c7fc30db247f39da703"
@@ -8923,20 +8908,6 @@ nano-css@^5.3.1:
     stacktrace-js "^2.0.2"
     stylis "^4.0.6"
 
-nano-css@^5.6.1:
-  version "5.6.1"
-  resolved "https://registry.yarnpkg.com/nano-css/-/nano-css-5.6.1.tgz#964120cb1af6cccaa6d0717a473ccd876b34c197"
-  integrity sha512-T2Mhc//CepkTa3X4pUhKgbEheJHYAxD0VptuqFhDbGMUWVV2m+lkNiW/Ieuj35wrfC8Zm0l7HvssQh7zcEttSw==
-  dependencies:
-    "@jridgewell/sourcemap-codec" "^1.4.15"
-    css-tree "^1.1.2"
-    csstype "^3.1.2"
-    fastest-stable-stringify "^2.0.2"
-    inline-style-prefixer "^7.0.0"
-    rtl-css-js "^1.16.1"
-    stacktrace-js "^2.0.2"
-    stylis "^4.3.0"
-
 nanoid@^3.1.22, nanoid@^3.3.6:
   version "3.3.6"
   resolved "https://registry.yarnpkg.com/nanoid/-/nanoid-3.3.6.tgz#443380c856d6e9f9824267d960b4236ad583ea4c"
@@ -10969,26 +10940,6 @@ react-use@^17.4.0:
     ts-easing "^0.2.0"
     tslib "^2.1.0"
 
-react-use@^17.4.1:
-  version "17.4.2"
-  resolved "https://registry.yarnpkg.com/react-use/-/react-use-17.4.2.tgz#26d43c774ccb733a17a87be62e12fbcbc5654173"
-  integrity sha512-1jPtmWLD8OJJNYCdYLJEH/HM+bPDfJuyGwCYeJFgPmWY8ttwpgZnW5QnzgM55CYUByUiTjHxsGOnEpLl6yQaoQ==
-  dependencies:
-    "@types/js-cookie" "^2.2.6"
-    "@xobotyi/scrollbar-width" "^1.9.5"
-    copy-to-clipboard "^3.3.1"
-    fast-deep-equal "^3.1.3"
-    fast-shallow-equal "^1.0.0"
-    js-cookie "^2.2.1"
-    nano-css "^5.6.1"
-    react-universal-interface "^0.6.2"
-    resize-observer-polyfill "^1.5.1"
-    screenfull "^5.1.0"
-    set-harmonic-interval "^1.0.1"
-    throttle-debounce "^3.0.1"
-    ts-easing "^0.2.0"
-    tslib "^2.1.0"
-
 react-virtualized@^9.22.3:
   version "9.22.3"
   resolved "https://registry.yarnpkg.com/react-virtualized/-/react-virtualized-9.22.3.tgz#f430f16beb0a42db420dbd4d340403c0de334421"
@@ -11483,13 +11434,6 @@ rtl-css-js@^1.14.0:
   dependencies:
     "@babel/runtime" "^7.1.2"
 
-rtl-css-js@^1.16.1:
-  version "1.16.1"
-  resolved "https://registry.yarnpkg.com/rtl-css-js/-/rtl-css-js-1.16.1.tgz#4b48b4354b0ff917a30488d95100fbf7219a3e80"
-  integrity sha512-lRQgou1mu19e+Ya0LsTvKrVJ5TYUbqCVPAiImX3UfLTenarvPUl1QFdvu5Z3PYmHT9RCcwIfbjRQBntExyj3Zg==
-  dependencies:
-    "@babel/runtime" "^7.1.2"
-
 run-async@^2.2.0, run-async@^2.4.0:
   version "2.4.1"
   resolved "https://registry.yarnpkg.com/run-async/-/run-async-2.4.1.tgz#8440eccf99ea3e70bd409d49aab88e10c189a455"
@@ -12505,11 +12449,6 @@ stylis@^4.0.6:
   resolved "https://registry.yarnpkg.com/stylis/-/stylis-4.1.3.tgz#fd2fbe79f5fed17c55269e16ed8da14c84d069f7"
   integrity sha512-GP6WDNWf+o403jrEp9c5jibKavrtLW+/qYGhFxFrG8maXhwTBI7gLLhiBb0o7uFccWN+EOS9aMO6cGHWAO07OA==
 
-stylis@^4.3.0:
-  version "4.3.0"
-  resolved "https://registry.yarnpkg.com/stylis/-/stylis-4.3.0.tgz#abe305a669fc3d8777e10eefcfc73ad861c5588c"
-  integrity sha512-E87pIogpwUsUwXw7dNyU4QDjdgVMy52m+XEOPEKUn161cCzWjjhPSQhByfd1CcNvrOLnXQ6OnnZDwnJrz/Z4YQ==
-
 sucrase@^3.32.0:
   version "3.34.0"
   resolved "https://registry.yarnpkg.com/sucrase/-/sucrase-3.34.0.tgz#1e0e2d8fcf07f8b9c3569067d92fbd8690fb576f"