The decentralized social media platform, Friend.tech, is witnessing a surge in its Total Locked Value (TVL), nearly doubling to close to $20 million in a span of four days. Following a short-lived period of stagnation and doubt, the platform’s resurrection has captivated the crypto community.
Founded on Coinbase’s Layer 2 Base on August 11, Friend.tech was called into question when key performance indicators like activity, inflows, and volume saw a sharp decline two weeks post-launch. In the first 10 days since its establishment, the platform amassed an enviable revenue in fees, exceeding $5.9 million. However, the celebration was cut short as user engagement data took a plunge. The following week was unkind to Friend.tech as daily fees suffered an 87% drop and transaction volumes went down by 90%.
This drastic decline resulted in skepticism towards the protocol’s sustainability, with judgements being passed about it being “dead.” As per Lisandro Rodriguez, a payments risk manager at Coinbase, the blame for Friend.tech’s predicament lies with human greed and a flawed scaling strategy. The escalation in automated bot trading, capitalizing on swift price changes and possibly disrupting transaction order, was also highlighted as a potential issue.
However, recent data paints a completely different picture, as Friend.tech is experiencing an uptick, hitting a new peak in the past few days. With a daily trading volume inflow of almost $12.3 million, Friend.tech stands as the third highest revenue-generating decentralized application (dApp) in the entire DeFi ecosystem. This sudden spike has sent ripples throughout the entire cryptocurrency world.
The noteworthy point is that Friend.tech’s total locked value outstripped Opensea, a prominent NFT marketplace, by nearly $3 million. The platform has begun to attract non-crypto influencers and renowned personalities, primarily due to its creator-first approach. The number of users on Friend.tech has seen a 104% increase since September 9, expanding its user base by over 140,000.
The Friend.tech team has been actively rolling out updates to improve app functionality and user experience. Notable enhancements include image upload capabilities, credit card purchase options, and the introduction of new sections for a range of activities.
This revival has not only boosted Friend.tech’s TVL, but also positively impacted Base, the parent network it was built on, resulting in a slight increase in Base’s total locked value. This recent event raises the question – is this just another rise before the fall or the beginning of a sustainable growth trajectory for Friend.tech? Only time will tell.
Source: Cryptonews
