A new social app called Friend.tech is making some noise within the cryptocurrency sphere. This decentralized social media platform lets you invest and sell social standing essentially.
You can buy shares of a social network, and those shares go up in value as more people buy shares. It’s almost like a tokenized version of credibility. We’ll go deeper into how the app works before discussing whether it’s safe for you to use and its potential for the future.
How Friend.tech Works
Getting the app for Friend.tech is fairly easy, you just have to go to the website on your mobile device. You’ll then immediately be prompted to install the app to your home screen. Actually using the app, however, requires you to have been invited by another user, so if you haven’t been yet, you can’t use the app. This will change after the beta stage. You’ll then need to fund the app with Ethereum (ETH) in order to start using it. Friend.tech is built on Coinbase’s Ethereum Layer-2: Base.
Once on the app, there are creators (influencers) and followers. As an influencer you can sell shares to followers who want to join your group and gain access to the perks entailed. Perks are fairly basic in that they’re the information and/or media provided by the influencer. Only followers can see this stuff. As a follower you can buy shares in any influencer you want and sell them when the price goes up as a way to make profit.
Friend.tech has changed the term shares to keys, to be more in line with what they do. They provide you access to a creator’s chat rooms and whatever information is contained within.
The price of the keys can go up and down depending on the popularity of the creator, meaning you can make money by buying keys for a creator whose popularity increases over time but lose money for those who don’t. The price of shares/keys on the app works using a bonding curve.
With Friend.tech, the price of a key/share in ETH follows a mathematical relationship to the supply of the shares within a given group. This means that the more shares are purchased, the more it has a chance to increase in value. However, it also means that you need more shares of a particular creator to make profit over the long-term.
The bigger issue of the bonding curve model that Friend.tech is using is that it isn’t scalable. Currently, in order to purchase a key for a creator that has just 148 keyholders would cost you over 2 ETH (almost $4,000 USD). Imagine the buy-in for a creator with just a thousand shareholders. Unless this bonding curve model is changed, the platform will fizzle out at a few thousand users per creator, if it even gets there. Why pay thousands to see information that’s also a tweet on X.
Is Friend.tech Safe?
Perhaps the bigger question surrounding Friend.tech is whether it’s safe to use as a platform. There are actually some things to keep in mind when getting the app, not the least of which is that the app isn’t available on an app store and there’s no whitepaper to see how it all works. A whitepaper is fairly important in showing the legitimacy of a project, as it shows direction and inner workings which are necessary when making investment decisions.
Not only that, but after digging through code, someone found that your wallet keys reside on a server that Friend.tech controls, creating vulnerabilities.
The team behind Friend.tech has some sketchy background history in the community. 0xRacerAlt and shrimppepe who own the company, started an NFT project called KosettoIsKawaii previously, and have since pulled the rug out on investors. There have been no updates on the project since early 2023, with Friend.tech somewhat suspiciously being funded, developed, and launched in the meantime.
It’s not out of the question that Friend.tech is just another scam, especially when you consider the lack of a whitepaper and the lack of scalability in the platform. If only early investors can make money and the prices increase as more users join, it feels unsafe to invest in. Who knows how hard it may be to cash out your keys when you actually want to sell too.
Future Potential of Friend.tech
In its current form, Friend.tech isn’t exactly going to be able to make a big run as a social media platform. There aren’t too many people that even wanted to pay for the blue check on X, let alone people who are going to want to pay thousands to essentially follow someone they already do on X.