Interpretation of friend.tech V2: New opportunity or old trick?

Original title: Friend Tech V2: Opportunity or Blodbatch?

##Written by: Francesco

Compiled by: Shenchao TechFlow

friend.tech Introduction

friend.tech (FT) is SocialFi One of the most successful Web3 dApps in the world, it reached its highest revenue to net deposit ratio ever, with first-month revenue of over $2 million and net deposits of over $33 million.

This should be a big week for FT as they launch V2 of the product and the platform’s token $FRIEND, introduce significant changes to enhance the sustainability and appeal of the protocol, and more, But that turned out to be (probably) the end of it.

Previously, some people were optimistic about these developments while others were pessimistic, but after today's developments, everyone is in disbelief.

In this article, we will take a deep dive into FT V2’s new mechanic, $FRIEND, explore any vulnerabilities it has experienced or is still experiencing, and discuss whether this business model is sustainable.

Let’s first look at the challenges faced by early versions of friend.tech.

On friend.tech V1

FT is the first decentralized social application to consistently generate revenue by aligning the interests of well-known cryptocurrency figures with those of retail investors.

This consistency resulted in FT becoming one of the new projects with the largest user base growth, increased activity, and increased revenue during the bear market.

However, this model is not sustainable due to the fees charged by the platform.

Although KOLs and FTs earn considerable income, retail investors are losing money every day. Since there is a 0% tax on buy and sell transactions, they can only make a profit by selling the keys for at least 20% more than the purchase price.

This is only possible during periods of higher platform activity and inflows, which is the main reason for the volatile behavior observed in the chart below.

In the end, the cost became a barrier for many people to enter the market, causing FT V1 to make many people miserable.

Even so, FT V1 achieved several milestones within 6 months, which few protocols can achieve throughout its entire life cycle:

Approximately $13M in fees generated:

Transaction volume reached $130M (probably the highest volume achieved by a SocialFi dapp):

distributed approximately $6 million in revenue to its users:

在friend.tech V2

FT V2 was released on Friday, March 3, 2024.

As part of this long-awaited update, users can finally claim their $FRIEND tokens.

However, the launch appears to have fallen short of expectations, including a lack of relevant information.

This is the only official announcement from FT on Twitter since its launch.

#Understandably, this makes many people confused about the airdrop claiming process.

Users can only claim 10% of their airdrops (provided they follow at least 10 people), and need to join a club to claim the remaining 90%.

However, these requirements are not clear, as there are no pop-ups or guidance within the app, and in many cases, users cannot claim a club even after joining it.

#What are clubs?

Clubs are one of the major new features introduced in FT V2.

Anyone can create a new club. Clubs are defined as "group spaces" owned and managed by key holders; however, it is unclear how they will be used in the future.

Here's how clubs work:

• Key holders vote to elect the club's president
• The president manages the club and selects moderators
• All club keys are traded using $FRIEND
• Each club transaction requires a 1.5% transaction fee, which is allocated to farmers and FT

We use the Base Scan contract An interesting phenomenon observed in the interface is the change of changeBestFriend and changeBestFriendfee. We can speculate that this will be used to allow anyone to add a best friend, which can allow us to reduce or eliminate the cost when trading keys. Handling fee.

We can also speculate that FT will soon launch a referral fee (point 7 in the figure below), and we also know that club keys are transferable (maybe even user keys will be the same?).

The club below (Fight Club) was the first club represented by FT#1 and Racer was actually its president, which is reflected in the price of the key .

However, as you can see from the picture below, he did not create the club himself.

When creating a club, users can select the following:

• Name
• Description
• Price Curve (Standard or Exclusive)
• How many keys to buy

It’s worth mentioning, though, that most of these are assumptions , as FT is expected to provide more information about Clubs and their mechanisms.

There are also some elements that users need to be aware of when interacting with clubs: Anyone can transfer a club share to someone else and appoint them as chairperson.

So you have to be very careful about the high-profile people who are nominated for the chair: they may not even know they have been nominated.

For example, this morning we created a random club and invited Racer to join!

Please note that Clubs can have the same name, so always check the FT# of the club to make sure you are purchasing the correct Club.

In addition to these changes, the homepage of Web App has also changed. New elements are now displayed, including "Farm" (LP), airdrop claims, and rewards.

Currently, users can only claim their airdrops, create clubs, buy and sell tokens, and use them in farms to earn rewards.

Furthermore, many have emphasized that the role of keys has not really changed, nor has their usefulness expanded. Social media elements that were supposed to change the direction of the platform also seemed missing or underwhelming.

Still, we don’t know if this is the final version or if a new update will be released soon.

Last but not least, many people have higher expectations for the price of the $FRIEND token.

Coupled with the lack of new use cases for keys, this may be the key to whether the airdrop is worth it and whether many people will be fumbling to sell their $FRIEND tokens.

All of these factors make it difficult to envision the long-term sustainability and success of this model, which may or may not be the final version given the current design.

It is also worth mentioning that there is a delay between completing the on-chain operation and being reflected on the FT interface.

We observed approximately 3-4 hours of latency.

Is the friend.tech model sustainable?

Many people have questioned the sustainability of the FT model, and although these doubts were initially ignored due to the incredible appeal of dApps, as the popularity of FT gradually subsided, these critics The sound is getting louder and louder.

As FT V2 moves away from the influencer-centric model launched by V1, the protocol aims to reduce its dependency and become more sustainable.

In fact, reliance on influencers is a single point of failure: a social network is only as valuable as its users. The absence of many important characters would make FT much less attractive.

What is the value of Hsaka or Ansem if they rarely connect to the application, let alone share alpha there?

This may be one of the key reasons why the team has recently shifted to a more community-centric (read: degen) approach.

This is one of the key questions for FT: How do they ensure that users are incentivized and prefer their app to others like Twitter, Farcaster, Lens, etc.?

Despite the hype that followed the coin’s launch, FT did not attract the same level of attention as the previous two waves.

Many people speculate that with the release of $FRIEND, the protocol will gradually receive more and more attention. However, current indicators fall far short of expectations.

Will this become another case of Sell the news?

Or will the long-awaited V2 version transform friend.tech into a leading social application and attract new user groups?

The current version of FT V2 appears to be missing some key features which have been removed from the application.

For these reasons, it can be speculated that this will not be a full version of FT 2 and may be followed by an upcoming update.

We want to end this post with a reflection: Is this all FT could have developed after 8 months, with crazy funding, resources and hype? Or, is this another masterful tactic by the team to collect all negative feedback, iterate, and release the final version of the app?

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