Head over to X, formerly Twitter, and the first post you’ll see is likely to be about Friend.tech, the latest gamified social media offering powered by Coinbase and Paradigm.
Opinions and comments on the app are vast in their approach, with some touting the app as a paradigm shift, others not sure if they should get involved, and still others still calling it the next BitClout doomed to fail.
Given the app’s early stage, each of these perspectives carries weight and can reflect the true trajectory of the latest craze.
Paradigm shift or doomed to failure?
With the hype for the new social platform seemingly at an all-time high, there’s no doubt there are early adopters and supporters out there who will benefit from the shares they’ve bought and sold. These same individuals are also likely to share testimonials about how great and innovative the app is, in that it gives value back to the community – with euphoria fueled by significant amounts of volume.
Absolutely insane.
FT has accrued more fees than Tron, Uniswap, and BTC in the past 24 hours. It’s not far from Lido, which has 13.8 billion ETH on it!
While the initial airdrop hype may be fading, FT gives us a glimpse of what crypto’s mass adoption feels like. pic.twitter.com/PXKuuNARmk
— Ignas | DeFi Research (@DefiIgnas) August 20, 2023
However, the underlying concept behind Friend.tech is not entirely new, in fact it is very similar to BitClout of 2021 and while that application is now receiving a lot of criticism, it once raised over $200 million USD at its peak and was defended by very considered social influencers and celebrities.
X user Alex Valaitis, who shared his collaboration with DeSo, the project behind BitClout, shared why he thinks Friend.tech won’t last. He attributed this largely to the platform’s bond curve mechanics, which simply accelerate the price rapidly, but Valaitis outlines that this is where the “back pull” comes from, as someone will cash out early in the bond curve, leading to a crater price .
The controversial Web3 personality beanie further illustrates this, calling the platform a “high-stakes game of musical chairs” where the only retailers who make a profit are the first to be first. He further shared that influencers, Coinbase and Paradigm will of course come out on top and highlights the nature of the game, stating “this is how things are done and there’s nothing new to see here” but that retail users have to continue. with “extreme caution”.
Insecurity & Skepticism
The uncertainty surrounding Friend.tech lies in a number of different areas, namely the privacy policy or lack thereof, potential regulatory issues, and the public release of data from 100,000 accounts reported as a leak by some outlets.
However, the latter has since been refuted by Friend.tech, who said it was just someone scraping their public API and that “it’s like saying someone hacked you by looking at your public Twitter feed.” In addition, information such as wallet addresses is already publicly available, as is the nature of the blockchain.
The other concerns, however, remain valid: when you navigate to the app’s privacy policy, a pop-up appears saying “coming soon.” This was understandably off-putting for several users as financial systems are linked to the app.
Additionally, reports of regulatory attention have surfaced following a weekend in which the app saw more than $1 million USD in fees generated over a 24-hour period. Attention is likely a direct result of earnings expectations as creators can share fees with their ‘shareholders’. While these tokens were originally called stocks, Friend.tech has since done so changed rename these tokens to Keys – probably to avoid unwanted scrutiny.
We’ve renamed Shares to 𝗞𝗲𝘆𝘀. The original name was a placeholder during development and we think Keys better illustrates their purpose as in-app items used to unlock your friends’ chat rooms pic.twitter.com/phkZky13VL
— friend.tech (@friendtech) August 21, 2023
Things to consider
While only time can tell the outcome of Friend.tech, there are some probabilities and considerations to keep in mind. The first is that it is more likely than not that the platform will suffer the same fate as BitClout, that private users or “key” investors are undoubtedly in the riskiest position financially, and that creators who choose to use this platform , must decide to provide exclusive value to their holders or risk potential reputational damage.
An example of the latter can be seen in the popular X personality, Cozomo de’ Medici’s hesitation when participating in the platform. When he asked his followers if he should join, some said why not, while others liked artist Bryan Brinkman expressed that it could detract from the value of Medici’s other initiatives. Nevertheless, Medici has shared that he is “trying it out”.
Numerous artists and prominent community figures have expressed their reluctance to join Friend.tech. The platform, despite its buzz, has failed to capture the interest of these key players. Their hesitation raises questions about the platform’s potential for mainstream adoption or simply feels exhausted by the amount of other decentralized platforms like BitClout, Mastodon, and Bluesky, which were short-lived in the CT community.
While this is a simple statement, it is important that creators trying out the new platform make the expectations clear to their community and that the community proceed with caution, as along with the potential for profit is the potential for loss.