On Sept. 8, the team behind the decentralized social media protocol Friend.Tech transferred control of its smart contract to Ethereum’s null address, effectively relinquishing control of the project one year after its successful launch.
In a social media post on X, the team stated:
“Admin and ownership parameters have been set to 0x000…000 to prevent any changes to their fees or functionality in the future.”
Despite this, the web client at Friend.Tech will continue to operate as usual. The team also clarified, “No fees from either the smart contracts or Friend.Tech currently go to the dev team multisig.”
Following the announcement, the platform’s native token FRIEND plummeted by over 47% in 24 hours, reaching an all-time low of $0.06026, according to CryptoSlate data at press time.
While the team has not provided a clear reason for this move, CryptoSlate’s analysis of on-chain data highlights the platform’s steep decline in popularity.
Friendtech’s decline
Friend.Tech, launched in August last year on Coinbase’s Layer 2 network Base, initially gained rapid traction in the crypto community.
By September 2023, the protocol’s daily earnings surpassed Ethereum’s, and its top keys fetched high prices. Around the period, the platform also raised an undisclosed seed round from crypto VC firm Paradigm.
However, the hype faded as the platform struggled to maintain momentum. It faced several challenges, including sim swap attacks and mismanaged plans to exit the Base blockchain.
These issues contributed to a sharp decline in user engagement. Dune Analytics data shows the platform’s transaction volume dropped by 99%, and by September, it was failing to attract new users.
This decline inadvertently severely impacted revenue, which fell to just $21 over the last 30 days, according to DeFillama data. During the same period, the platform generated less than $10,000 in fees.
Crypto community reacts
Friend.Tech’s downfall drew widespread criticism from the crypto community, particularly regarding the team’s handling of the project.
Calvin Chu, a core builder at Impossible Finance, voiced his disappointment, saying, “Friend.Tech had become more of a lab experiment than a genuine social finance project.” He further expressed frustration over being “rugged” by the decision to shut down future upgradeability, which, in his view, ended any hope for further development.
Similarly, Mikko Ohtamaa, the CEO of Trading Strategy, added that Friend.Tech was a prime example of monetizing hype and quickly cashing out.
Read the full article here