By Tom Blitzer
Key Insights:
- Friend.tech redefines social networking, enabling users to trade ‘shares’ of connections for private messages.
- Pseudonymous developer Racer aims to empower crypto influencers and Web3 projects with royalty opportunities.
- Analysts delve into Friend.tech’s revenue model, risks, and potential impact on social networking dynamics.
Friend.tech, an emerging DeSo platform, has captured the crypto realm’s gaze with over $1 million in fees amassed within a day. This feat eclipses giants like the BTC network and Uniswap. Unveiled on August 11, the beta platform empowers users to tokenize social bonds by trading “shares” of their connections.
Monetizing Social Connections Through Tokenization
Users can monetize their social networks by trading “shares” representing their connections. Upon obtaining a share, users gain access to private messaging. The platform imposes a 5 percent transaction fee, using the price difference between purchases and sales to generate profits. This methodology has led to a notable engagement, with over 650K transactions and a diverse pool of over 60K traders active on the platform.
Crypto projects’ fees and revenue ranking (Source: DefiLlama)
Built on Coinbase’s layer-2 Base, Friend.tech has seen substantial engagement since its establishment. Insights from DefiLlama reveal that the platform accrued $1.12 million in fees within 24 hours and a cumulative $2.8 million since its introduction. At the time of writing, the overall project revenue is $818,620.
The Developer Behind the Platform
The origins of the project are attributed to the pseudonymous figure, Racer. A senior engineer at Coinbase revealed Racer’s past involvement in crafting social media platforms like TweetDAO and Stealcam, leveraging nonfungible tokens. Friend.tech suggests Racer focuses on crypto influencers, empowering them to gain royalties from transaction fees. Additionally, the platform catches the attention of Web3 initiatives looking to strengthen connections with prominent players in the crypto sector.
Assessing the Revenue Model and Future Implications
The rapid expansion of Friend.tech has sparked an examination of its income structure, possible vulnerabilities, and future progress. An anonymous decentralized finance analyst named Ignas noted that the platform’s existing business model primarily relies on transaction fees rather than an uptick in shareholders. Ignas also mentioned that contentious individuals might find opportunities for higher earnings, and tactics like FUD could be employed to generate fees.
Lux Moreau, the creator of Talk.Markets highlighted that the value of shares often experiences notable increases when they’re traded within the platform. This dynamic might pave the way for developing smaller collectives or different group configurations within the platform.
In conclusion, Friend.tech’s rapid ascent within the crypto ecosystem underscores the potential for decentralized social networks to offer alternatives to conventional social media models.