The decentralized social media platform – Friend.tech – witnessed over $18.51 million in trading volume on September 13th, hitting a new peak. Data from Dune Analytics further suggested that the fees generated as a result also recorded a new high of $1.9 million on the same day.
The resurgence coincides with the emergence of reports indicating that Friend.tech was experiencing a decline after initially skyrocketing in popularity during a dull summer for digital asset traders. This subsequently sparked concerns that the app might be merely another crypto fad.
Friend.tech is a decentralized application (DApp) built on Coinbase-incubated layer-2 Ethereum protocol, Base. Its main function is to enable users to purchase shares of X (formerly Twitter) accounts and interact with each other in a closed, group-chat setting. The platform saw a substantial influx of new users and even attracted numerous influential celebrities in a very short span of time.
However, the recent slump across various key metrics such as activity, inflows, and volume sparked skepticism, with critics questioning its vitality. Even Coinbase payments risk manager Lisandro Rodriguez expressed disappointment over the platform, calling it “dead” as a result of “greed and poor execution.” The latest data, on the other hand, suggests a different narrative.
Over the last several days, Friend.tech has observed a resurgence in trading volume as well as fees. Additionally, there is an upward trend in the number of daily active users contributing to this trading volume. On September 13th, around 16k users were recorded, which pushed the volume and fees to all-time highs.
Alongside the trading volume and fee recovery, buyers and sellers have also surged on the same day. The number of unique buyers on the platform climbed to over 155,000, while the number of sellers surpassed 75,000.
What’s Driving Friend.tech’s Growth?
According to a new report by Token Terminal, there are several contributing factors to the app’s growth. It highlighted that Friend.tech currently stands without any direct competitor.
Unlike other social dApps like Lens or Farcaster, which function under the open social-network model (similar to X or Facebook), Friend.tech is focused on the monetization of “gated” content. In the traditional Web2 models, the closest business counterparts to Friend.tech are Patreon and OnlyFans, but its primary competition for users, at its current stage, remains with X.
Moreover, the report indicated a strong possibility that Friend.tech strategically timed its launch to coincide with that of Base, aiming to optimize activity on both the protocol and blockchain.
However, risks persist in terms of Friend.tech’s server, which reached capacity twice on August 11th, resulting in user access disruptions. Despite subsequent announcements from the team about server upgrades, users have sporadically reported poor user experiences due to server limitations.