A mere three weeks post-launch, decentralized social platform Friend.tech is facing intense scrutiny as key performance metrics have dwindled, leading many to pronounce it as a "dead" platform.
Having launched its beta version on Coinbase’s layer-2 Base on Aug. 11, Friend.tech initially generated significant buzz, especially after its fees eclipsed both Uniswap and the Bitcoin network, reaching over $1 million within a day on Aug. 19. Despite this, the initial momentum seems to have been short-lived, while also trouncing speculations that info from its users was leaked.
Comparisons have also been made between Friend.tech and the 2021 DeSo app BitCloud. Web3 marketer Legendary predicts a similar fate for Friend.tech, anticipating that it "will collapse as BitClout did."
Aggregated blockchain data reveals a significant drop in daily fees, which hit a high of $1.7 million on Aug. 21 and subsequently plunged by over 87%, settling around $215,000 by Aug. 26. Concurrently, transaction activity on the platform saw an over 90% decrease, falling from a high of nearly 525,000 on Aug. 21 to just over 51,000 on Aug. 27, as indicated by data from Dune Analytics compiled by Crypto Koryo.
Social media, particularly X (formerly Twitter), is awash with commentary on the network's drastic decline. One such tweet by @beaniemaxi reads, "RIP Friendtech. August 2023-August 2023."
RIP FriendtechAugust 2023-August 2023? pic.twitter.com/Fb0bh23Fyo
— Beanie (@beaniemaxi) August 26, 2023Friend.tech's operational model focuses on users buying and selling "keys" that grant buyers the ability to send private messages to sellers. For each transaction, the platform purportedly retains a 5% commission. This model attracted several prominent figures from both the crypto realm and beyond, including the host of the UpOnly podcast, Cobie, YouTuber Faze Banks, and the Russian protest group Pussy Riot.
However, the rapid decline has sparked criticism, with Coinbase payments risk manager Lisandro Rodriguez suggesting in an X post that the platform's downfall can be attributed to "greed and poor execution."
The available data further underscores the downturn, showcasing a drop in the number of active buyers and sellers. From an Aug. 21 peak with over 58,000 buyers and 27,000 sellers, the numbers dwindled to about 10,000 buyers and 7,800 sellers by Aug. 27. Inflows, too, experienced a decline, plummeting nearly 90.5% from an Aug. 21 high of $16.8 million to approximately $1.6 million on Aug. 27.
Even before this steep decline, skepticism surrounded the platform. Crypto commentator Yazan, in the previous week, expressed concerns over the sustainability of user key price surges, wondering aloud about the feasibility of individuals paying 1 Ether (ETH) or more simply to gain access to private chats.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
