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The social app Friend.tech has registered a big increase in protocol fees, generating fees in excess of $1.4 million over the past 24 hours.
The jump in 24-hour fees places it in the top three projects for fee generation, only behind Ethereum and Lido, according to data from DeFiLlama.
A Significant Jump In Fees
With the protocol fees generated over the past 24 hours exceeding $1.4 million, Friend.tech has surpassed several prominent blockchain projects when it comes to fees generated. This includes projects such as Tron and Uniswap. Currently, the project sits only behind Ethereum and Lido Finance, according to data sourced from DeFiLlama. Data also shows that the recorded fees for the protocol for the last week were $2.99 million, out of which $1.49 was revenue.
Friend.tech is a social app that operates on Coinbase’s Base Layer-2 chain. The social app is integrated with platforms such as X (formerly Twitter), allowing users to trade tokenized shares directly in one another’s social profiles. Shareholders get plenty of unique perks, such as excluding access to content and access to private chat rooms. Friends.tech has only recently gained considerable traction among Twitter users.
As a result, the protocol has seen a bevy of new, high-profile members join over the weekend. Prominent new joinees include NBA star Grayson Allen and startup incubator Y Combinator CEO Garry Tan.
$26 Million In Volume Since Launch
Since the platform’s beta release, Friend.tech has managed to record over 65,000 unique traders of shares, resulting in over $26 million in trading volume. These figures have been backed up by data sourced from a Dune Analytics dashboard created by Crypto Koryo. Friend.tech’s stellar rise to the third position among projects when it comes to 24-hour fees is even more significant when you consider the fact that the platform is currently available and accessible on an invite-only basis.
Friend.tech also recently revealed a seed investment from venture capital firm Paradigm. However, the protocol did not disclose the exact amount of the investment from Paradigm. Friend.tech shared some details on X, stating,
“Earlier this year, we partnered with @paradigm to build tools for new online social interactions. We’re grateful for the community’s warm reception and excited to continue growing with you all.”
Critics Not Convinced
While a majority of crypto heavyweights have been extremely bullish about the decentralized social media app, some critics remain unconvinced and have advised caution. Crypto commentator Yazan highlighted several factors that, according to him, indicated that the app had between six to eight weeks before share prices and general activity on the platform registered a significant drop. Yazan stated,
“Let me tell you one thing. Something isn’t right about @friendtech. Creators making money from a group chat that doesn’t even work when you can’t even reply directly to people? The way pricing works is ridiculous and can be easily taken advantage of. Pumps and dumps.”
He also argued that the rate at which the share prices have increased is unsustainable.
“The market making that guarantees that the app makes the most money along with creators — the price goes up too fast. How come there’s 100 holders, and the price is 1 ETH — 1 ETH to be able to see a private chat?”
Meanwhile, in a thread on X, the pseudo-anonymous software engineer Cygaar stated that the price of a user’s shares on the app is proportional to the square of its outstanding supply. This means that as supply increased, the price increased exponentially. Web3 marketer Legendary drew comparisons with BitClout, a decentralized social app launched in 2021 that gave a bearish outlook regarding Friend.tech’s longevity. He stated that the platform would eventually collapse like BitClout did.
“I think the platform will collapse as BitClout did. We are in a bear market, and there’s nothing to do. Everyone jumps on an opportunity to make money, but I think the platform will be done within the next weeks to months.”
However, some have shared a far more positive outlook and have praised the decentralized social media app for its novel developments in UX when it came to crypto applications. The co-founder of Jokerace and EcoDAO, David Phelps, called Friend. tech’s UX as the “greatest UX crypto has seen.”
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.