Daily trades on the decentralized social network friend.tech have plummeted by 95 percent from August 21, according to data retrieved by Dune user cryptokoryo.
The platform saw a peak of nearly 39,000 daily trades on August 21 and a fall to about 1,400 in the past days. The platform also experienced a drop in revenue from $1.98 million to about $8,300.
The platform sparked interest with its invite-only beta launch on August 10. It facilitates crypto transactions by allowing users to tokenize themselves and sell “keys” to their fans and followers. These “keys” allow fans to send private messages to them.
Many big names jumped to join the platform, including crypto Twitter personalities such as gainzy222 and Frank DeGods, as well as NBA player Grayson Allen. Other non-crypto figures include YouTuber Faze Banks, Russian band Pussy Riot and UpOnly podcaster Cobie.
Alongside the decline in daily trades and money influx, the number of active key buyers and sellers also saw a sharp decrease. While there were around 58,000 buyers and 27,000 sellers during its peak on August 21, only 10,000 buyers and 7,800 sellers were recorded on August 27.
This has led to several crypto Twitter personalities labelling the platform as “dead,” leading critics and users alike to post their condolences for friend.tech’s decline online.
Despite the waning numbers, the fact still stands that friend.tech has amassed an overall inflow of $81 million since its launch. Many draw parallels between friend.tech’s decline to the crypto DeSo platform BitClout’s demise.
BitClout rose in 2021 following massive enthusiasm from the crypto community, raising over $200 million in funding. However, many criticized BitClout’s practice of facilitating the trading of “shares” of various celebrities without their consent. Despite its massive capital, BitClout shut down quickly.
In the face of adversity, the platform remains confident of its success. Recently, it warned users of the potential clones that might emerge, capitalizing on friend.tech’s popularity. friend.tech discourages its user base from exploring these clones by utilizing a penalty system.
“We expect @friendtech clones and other types of copies will emerge,” friend.tech said on Twitter. “To make sure loyal users are rewarded fairly during our beta, users moving to forks and copies will automatically opt out of earning Points and forfeit existing points.”
This anti-competition move has sparked criticisms from its user community. Twitter user @CryptoKaleo said, “Threatening/penalizing users for trialing other platforms is completely against what this industry stands for.”
Others speculate whether this action has anything to do with the flaws within the platform’s system. Some investigators have detected vulnerabilities within friend.tech’s system that leads to data leaks. Data researcher SpotOnChain revealed on Twitter that friend.tech user data can easily be obtained using APIs, leading to the data leak of 101,183 users.
In response to the backlash, friend.tech released a follow-up statement on Twitter within five hours. The now-deleted tweet contains an apology to its user base, admitting that the decision to punish users for trying out other platforms goes against the culture of the crypto community and is a “stupid statement.”
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