Friend.tech Token Plunges Over 20% Following Co-Founder’s Hint at Departure from Base
Ruholamin Haqshanas
Updated on:
May 27, 2024 05:36 EDT
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2 min read
FRIEND, the native token of Web3 social network Friend.tech, has experienced a significant decrease in value.
This decline occurred after Racer, one of the co-founders of the protocol, hinted at leaving Base, the Ethereum Layer-2 network developed by Coinbase that hosts the project.
In a post on X, 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.”
The Relationship Between Friend.tech and Base Has Been Turbulent
According to Racer, the relationship between the Friend.tech team and Base has been tumultuous.
In another post, Racer mentioned that Farcaster investors had misunderstood their project during its launch, resulting in a strained relationship with the Base community.
The team felt marginalized 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 that the Friend.tech team had experienced feelings of isolation and disconnection and expressed his 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,” Pollak wrote.
Following Racer’s statements, the value of the Friend.tech token dropped by approximately 20%.
Friend.tech’s Popularity Surges After the 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.
The hype surrounding the Base network, a Layer 2 solution associated with Coinbase, has played a significant role in the popularity of Friend.tech.
The involvement of Paradigm, an investment firm connected to Coinbase, has further boosted 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 transparent nature while emphasizing the importance of user caution in protecting personal information.
Nonetheless, Friend.tech has recently experienced a surge in popularity.
According to a Dune Analytics dashboard, the project generated more than $500,000 in revenue on May 3.
This comes after its revenue had fallen to under $20,000 over the past couple of months.
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