December 21, 2024
Friend.tech pronounced ‘dead’ after activity and fees tank

Less than three weeks after its launch, the decentralized social network Friend.tech was declared “dead” by critics due to recent declines in key indicators such as activity, inflows, and transaction volume.

On August 11th, Friend.tech launched a lively beta on Coinbase’s Layer 2 Base. A week later, on August 19, its fees topped $1 million in 24 hours, surpassing Uniswap and the Bitcoin network.

However, its fees have since dropped significantly.Daily rates peaked at $1.7 million on August 21, but fell more than 87% to around $215,000 on August 26 according to to De Philama.

Friend.tech’s transaction volumes are also down more than 90% from a peak of nearly 525,000 on Aug. 21, and just over 51,000 on Aug. 27, according to Dune Analytics. data Crypto Koryo compiled, and many posted condolences to the network on X (Twitter).

Friend.tech focuses on buying and selling “keys” that enable buyers to send private messages to sellers, and the platform reportedly charges a 5% commission.

It has attracted crypto and non-crypto influencers, including UpOnly podcast host Cobie, YouTuber Faze Banks and Russian protest group Pussy Riot.

In an Aug. 27 post, Coinbase payments risk manager Lisandro Rodriguez argued that the platform is “dead,” largely due to “greed and poor execution.”

As fees fell, so did buyers and sellers, with Dune reporting about 10,000 buyers and 7,800 sellers on Aug. 27, compared to a peak of more than 58,000 buyers on Aug. 21. The number of sellers is 27,000. data.

Since its peak on August 21, Friend.tech buyers (green) and sellers (orange) have both declined steadily. Source: Dune

dune show inflow Shares of Friend.tech have also fallen from a high of $16.8 million on Aug. 21 to around $1.6 million on Aug. 27, a drop of nearly 90.5%.

Protocol inflows peaked on August 21, but have trended downward since then.Source: Dune

Before last week’s drop, some community members had shared their gloomy predictions for the platform.

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Last week, cryptocurrency commentator Yazan revealed to Cointelegraph factors that lead him to believe Friend.tech will see a drop in user key prices and activity within six to eight weeks.

Yazan said that user key price increases are unsustainable, and questioned why so many people are willing to pay more than 1 ether (ETH) “to see private chats.”

The platform, similar to 2021 DeSo app BitCloud, is offered by pseudonymous Web3 marketer Legendary He said he believes Friend.tech “will crash like BitClout did.”

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