From Crypto Darling to Debacle in Two Weeks: Friend.tech's Revenue Drops by 70%

<p>The
cryptocurrency market has once again witnessed a sudden success and an even
faster downfall, with Friend.tech being the leading player. Within two weeks,
it became one of the highest-earning services in the decentralized finance
sector while simultaneously stirring up controversy with its business model and
alleged use of bots for speculation.</p><p>This
article delves into the rise and fall of Friend.tech, examining the factors
that contributed to its initial success and subsequent decline and its
implications for the broader crypto ecosystem.</p><p>Friend.tech's Dynamic Rise and Dynamic Bust</p><p>Friend.tech,
a <a href="https://www.financemagnates.com/terms/b/blockchain/">blockchain</a>-based platform that debuted on 10 August, experienced a rapid
ascent in the crypto world. The platform allows users to buy and sell digital
tokens linked to influencers on X (<a href="https://www.financemagnates.com/tag/twitter/" target="_blank" rel="follow">formerly Twitter</a>), providing a unique way to
engage with Internet personalities like Cobie, HsakaTrades, and professional athletes,
including Milwaukee Bucks player Grayson Allen. Within less than two weeks of
its launch, the platform's fees skyrocketed to nearly $1.7 million, making it
the highest-earning service provider in decentralized finance at one point.</p><p>However,
the platform's success was short-lived. Fees dropped by nearly 70% within days,
and the number of new users plummeted from 20,360 to just 4,484, a decline of
almost 80%. In the meantime, the revenue fell tenfold, from record-high
$840,000 reported on 21 August to $81,000 reported yesterday (Sunday).</p><p>The exact
reasons for the decline are still unclear, but Messari's (a crypto research firm) report cited high trading fees, slow load times, and a steep pricing curve as
potential factors.</p><p>Friend.tech
operates on Coinbase's new blockchain network, Base, and its initial success
was a rare bright spot for the chain. However, the platform has been plagued by
various issues, including a lack of a privacy policy and the role of automated
trading bots in manipulating transactions. These bots have significantly
contributed to the platform's downturn, as they can buy tokens before influencers,
forcing them to purchase at higher prices.</p><blockquote><p lang="en" dir="ltr">.<a href="https://twitter.com/BuildOnBase?ref_src=twsrc%5Etfw">@BuildOnBase</a> hit 16 transactions per second yesterdaylots due to <a href="https://twitter.com/friendtech?ref_src=twsrc%5Etfw">@friendtech</a> but still – incredible growth <a href="https://t.co/saHlb5cP7q">https://t.co/saHlb5cP7q</a></p>— Brian Armstrong