In the first weeks following the invite-only launch of its beta version, a rapidly growing userbase for crypto platform Friend.tech has some enthusiastic supporters hailing it as the first real success story in the social crypto space. In just two weeks, the platform reportedly gained more than 100,000 users and made about $25 million.
Social token-driven platforms allow users—including individuals as well as brands and businesses—to create and monetize online communities using blockchain technology. Supporters view social tokens as a probable key driver of Web3 adoption and an important way to bring newbies to the cryptocurrency world into the fold. In short, social tokens combine aspects of traditional cryptocurrencies with patronage systems, allowing influencers, creators, and others to monetize a fan base in exchange for exclusive offers and content.
In the early stages of its beta launch, Friend.tech already has interested potential users searching high and low for invite codes. But what is this new social crypto platform and how does it work?
Basics of Friend.tech
Friend.tech is a decentralized social network. Users can buy and sell “keys”—previously known as “shares”—that are linked to Twitter (now X) accounts. These keys offer access to private in-app chatrooms and exclusive content from that X user. The platform markets itself as “the marketplace for your friends.”
We’ve renamed Shares to 𝗞𝗲𝘆𝘀. The original name was a placeholder during development and we think Keys better illustrates their purpose as in-app items used to unlock your friends’ chatrooms pic.twitter.com/phkZky13VL
— friend.tech (@friendtech) August 21, 2023
Each user on the app has a chat group akin to ones found on platforms like Telegram. The catch is that users must purchase keys in order to enter other users’ private chats. They can later choose to sell those keys if they decide to leave the chat.
In this way, Friend.tech can be seen as a social media platform—or, perhaps more specifically, a sort of offshoot of X. Popular Twitter users have previously found success (and sometimes legal trouble) by using the platform to sell tokens that they themselves launched or which they’ve been paid to promote. Sometimes these users would incentivize the sale of these tokens by linking them to exclusive content.
Friend.tech takes this pre-existing aspect of Twitter and fleshes it out with a set of standardized crypto platform features, including airdropped rewards, fee sharing, and more. Like many other recent social media platforms, it requires that users have an invite code in order to join. This has helped to contribute to a highly competitive landscape in which eager would-be adopters search for codes, helping to promote the platform in the process. Users looking to get onto Friend.tech should access the site of the same name from a phone browser, which will allow them to add the app to their phone. Each member of the platform currently is provided with three invite codes to give out. Once in the app, a new user links their Google and X accounts and bridges ether from Arbitrum to the base wallet address. At this point, they are ready to begin buying and selling keys and participating in private chats.
Friend.tech is a browser-based application launched on the Base network, an Ethereum scaling network provided by crypto exchange Coinbase.
Rapid Growth
Friend.tech is not the first social token platform to receive widespread attention. Late in 2022, a platform called Roll attempted something similar, aiming to provide users the on-chain capacity to enable subscriber tiers like the popular Web2 site Patreon.
But Friend.tech’s growth has eclipsed other social token systems. Two weeks after its launch, Friend.tech earned a reported $1 million in fees, equivalent to 5% of the value of each transaction, in a single 24-hour period. That translates to more than $700,000 in ether revenue after accounting for gas fees and other costs in just a day.
And Friend.tech has already made some of its top earners a hefty sum in a similarly short time. Esports influencers in particular have rapidly risen through the ranks to become some of the top passive earners, gaining tens of thousands of dollars each in a matter of days. Individual users make fees each time keys to their private chats are bought or sold.
An added incentive for participants in the Friend.tech ecosystem is that users classified as “creators” (as opposed to “followers”) see key prices increase as their networks grow larger. This obviously benefits creators by providing them more rewards in the form of fees. But it also benefits their followers if they choose to sell their keys, assuming they have appreciated in value since the time they first purchased them. The price of keys is determined based on the concept of a bonding curve.
Potential Concerns
There are a number of reasons why others in the crypto community may approach Friend.tech with caution. For one, as with any relatively new crypto platform, the potential for manipulation of various kinds could be high. Users should beware of opportunities that seem too good to be true.
Another aspect of Friend.tech that may give some potential users pause is the fact that it was rebranded and reworked just a few months before the beta launch. Previously, the platform was known as Stealcam, a system allowing users to sell selfies and other images using a “steal to reveal” mechanism.
For the pseudonymous founders of Friend.tech, the bigger concern is sustainability. Indeed, a co-founder known as Racer told Decrypt that the initial launch was intended for load testing only, and the fact that the platform went viral came as a surprise. There has been a mad dash to try to scale the platform’s infrastructure and fix issues as they come up over the last two weeks.
Still others have likened the fast-growing platform to a Ponzi scheme, pointing to the fact that if you buy (and other people also buy) into a particular user’s keys, the value of those keys goes up. By linking appreciation in value of keys so directly and exclusively to the number of people investing in those keys, the thinking goes, eventually the entire system will come crashing down, leading to a rush to sell keys. Others have suggested the platform could fail because it lacks a compelling reason for users to stick around over the long term.
