Friend.tech Token Plunges Over 20% Following Co-Founder’s Indication of Departure from Base
Ruholamin Haqshanas
Updated: May 27, 2024, 05:36 EDT
| 2 minute read
FRIEND, the native token of Web3 social network Friend.tech, has experienced a significant decrease in value.
The drop occurred after Racer, one of the co-founders of the protocol, hinted at parting ways with Base, the Ethereum Layer-2 network developed by Coinbase that hosts the project.
In an X post, Racer stated, “System design bounty: If you can figure out a way to migrate friendtech off of Base without causing major issues for users, and it works well enough that we decide to use it, we will pay you $200K.”
Friend.tech’s Relationship with Base Has Been Turbulent
Racer revealed that the relationship between the Friend.tech team and Base has been tumultuous.
In another post, Racer mentioned that Farcaster investors had misunderstood their project upon its launch, leading to a strained relationship with the Base community.
The team felt excluded and disconnected from certain parts of the Base and Ethereum ecosystems.
Jesse Pollak, the head of Base at Coinbase, responded to the situation with a message of empathy.
In a post, Pollak acknowledged the Friend.tech team’s feelings of isolation and disconnection, expressing support for whatever path they choose.
“I’ll be sad if the team decides to leave Base, but I also respect and will support whatever path – that’s the beauty of the decentralized, onchain economy,” wrote Pollak.
Following Racer’s statements, the value of the Friend.tech token dropped by approximately 20%.
Friend.tech’s Popularity Surges after Decline
Since its launch on August 10, 2023, Friend.tech has become one of the leading decentralized applications (dApps) on the Base layer, attracting over 200,000 users and facilitating a trading volume exceeding $230 million.
The platform has a unique feature that converts user influence into tradable tokens called “keys,” allowing users to gain access to a creator’s attention or influence.
This model has attracted not only cryptocurrency influencers but also NBA players and esports personalities, expanding its appeal beyond the crypto space.
A significant factor contributing to Friend.tech’s popularity was the excitement surrounding the Base network, a Layer 2 solution associated with Coinbase.
The involvement of Paradigm, an investment firm connected to Coinbase, further bolstered confidence in Friend.tech’s potential.
However, the platform has also faced privacy concerns, particularly regarding the potential for user doxxing due to the link between Twitter profiles and Ethereum addresses.
Friend.tech has addressed these concerns by clarifying that the leaked information was actually from their public API, showcasing the platform’s openness while emphasizing the importance of user caution in protecting personal information.
Nevertheless, Friend.tech has experienced a surge in popularity recently.
According to a Dune analytics dashboard, the project generated over $500,000 in revenue on May 3.
This comes after its revenue had recently dropped to under $20,000 in the past couple of months.
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