The Friend.tech app built on the Coinbase-incubated Ethereum layer-2 Base has seen activity soar since Friday.
The app tokenizes Twitter accounts on-chain, letting users buy and sell “shares” of their favorite social media personalities.
Likely built by pseudonymous developer Racer, Friend.tech went live with an invite-only beta on August 11—a day after Base’s mainnet launch.
The application hit server capacity on launch day.
We hit server capacity and are provisioning more resources. We should be back up soon
— friend.tech (@friendtech) August 10, 2023
Its popularity exploded within the niche crypto community last Friday.
The number of unique users interacting with the app more than doubled from approximately 31,500 to over 67,400 at press time.
The number of unique accounts on Friend.tech. Source: Dune.
Friend.tech’s revenue and fees also outpaced market leaders in Uniswap, MakerDAO, and even layer-1 blockchains like Bitcoin and Tron on August 20, per DeFiLlama data.
The application has significantly boosted activity on the newly-launched Base blockchain too.
The number of daily transactions on Base reached a new peak of over 900,000 on August 20, nearly double of leading L2 networks in Arbitrum and Optimism.
What is Friend.tech?
Friend.tech is a mobile-only social media platform linked to Twitter that tokenizes user accounts. Users that buy another account’s so-called shares gain exclusive access to that account’s private chat room.
An interesting factor adding to its popularity is the implementation of a bonding curve that automatically calculates the buying and selling price, similar to Uniswap’s automated market-making (AMM) design.
Traders do not need to find a counterparty to buy or sell the shares on Friend.tech, instead, an automated mathematical formula determines the price based on the number of users holding an account’s shares.
The share’s price rises with the number of shareholders.
For instance, popular crypto trader and influencer Cobie’s account on Friend.tech is currently valued at 2.04 Ethereum, or about $3,400, with around 145 holders.
Crypto analyst Adam Cochran’s account with 57 holders is valued at 0.576 ETH.
The top accounts on Friend.tech. Source: Friend.tech
While its popularity has risen, some analysts have pointed out that the hype could be short-lived.
Pseudonymous crypto analyst “DeFi Made Here” tweeted that currently, the app is “nothing else than a way to speculate on shitcoins aka influencers’ shares and farm a potential airdrop.”
Moreover, its bonding curve is very steep, making it “difficult to attract more people” to buy a user’s shares, they said. “It just becomes too expensive after the first 100 shareholders.”
Nevertheless, it’s gaining considerable traction with notable personnel joining the social media app outside the crypto circles like Y Combinator founder Garry Tan, NBA player Grayson Allen, and professional gamer Faze Banks.
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Source: https://decrypt.co/153133/base-network-sees-activity-soar-past-arbitrum-optimism-friend-tech-frenzy
