Friend's Crossroads: Towards Glory or Obscurity?

Author: BitpushNews

Recently, friend.tech has successively released positive news, sparking market discussions. On May 3, friend.tech opened the project token FRIEND airdrop for application; on May 4, friend.tech released version 2; on May 7, friend.tech announced the upcoming launch of new features such as Keydrops, Memeclubs, and Pinned Rooms. Regarding the new version of friend.tech, opinions in the market vary, with some optimistic and others skeptical.

Looking at the token price, FRIEND had an opening price of $3.03 at the beginning of trading. As of May 7, the price had dropped by approximately 30%. So, how has friend.tech's v2 version performed since its launch? What innovations does friend.tech's v2 version bring? Facing competitors like Twitter and many Web3 social media leaders, what challenges does friend.tech face at this crossroads?

Friend.tech V2 Performance After the Initial Hype

Friend.tech (FT) is considered one of the most successful Web3 dApps in SocialFi, with revenue exceeding $2 million in the first month, net deposits over $33 million, and a very high revenue-to-net-deposit ratio. Following the launch of V2, friend.tech has shown good performance based on its large user base. According to Dune data, as of May 7, since the release of friend.tech V2, the number of Clubs has reached 131,643, with a total trading volume of 18,019,367 FRIEND tokens and Club fees totaling 269,495 FRIEND tokens. According to Bitpush terminal data, as of May 7, FRIEND is priced at $2.14, meaning that within 5 days of friend.tech's launch, fee revenue amounted to approximately $576,000.

Looking at the whale holdings data, most whales still have a positive outlook on friend.tech in the short term. According to DUNE, as of May 7, among the top twenty holders of FRIEND, 4 whales reduced their holdings, 7 whales increased their holdings, with @machibigbrother having the largest increase (adding 74,298 FRIEND tokens), and the remaining 9 whales maintaining their positions.

Overall, after the launch of V2, friend.tech has seen a significant increase in fee revenue in the short term, indicating high short-term activity. From observing whale holdings, although some whales have started selling FRIEND tokens, the overall sentiment among whales remains positive towards FRIEND in the short term.

Innovations of friend.tech V2

Before introducing friend.tech's V2 version, let's briefly understand the basic information of its V1 version. friend.tech was launched in August 2023, allowing users to buy and sell "Keys" associated with Twitter accounts. These Keys are essentially passes to private in-app chat rooms and exclusive content, effectively monetizing social interactions. The V2 version of friend.tech attempts to integrate the NFT community, DAOs, and social meme coins. Among them, Clubs (chat rooms) are one of the main new features introduced in FT V2.

Anyone can create a new club. Clubs are defined as "group spaces" owned and managed by key holders. Here's how clubs work: 1) Key holders vote to elect the club's chairman; 2) The chairman manages the club and selects moderators; 3) All club keys are traded using $FRIEND; 4) Each club transaction incurs a 1.5% transaction fee, distributed to farmers and FT. Chat room members can manage shared finances and mint tradable on-chain collectibles, meme coins, etc., creating additional income for the group. To support this, friend.tech will also have a local decentralized exchange, a hub for trading all these assets. Chat rooms will also introduce tagging, enhanced notification systems, pinned messages, lotteries, and referral programs.

In the V2 version, the friend.tech platform will also be improved, including new discovery features, enhanced keyword search capabilities, personalized recommendations for key purchases, and other user-specific suggestions. Considering the criticality of security in cryptocurrency, the V2 version will also integrate with cold wallets to enhance security and add two-factor authentication.

Overall, in the V1 version, friend.tech primarily aimed to quickly establish a Web3 social ecosystem through influential figures in the crypto space, then achieve growth and development for the platform, KOLs, and users through a fan economy. However, with user stagnation, the original model faced challenges. From the V2 version, it is evident that the FT team now focuses more on community-centric approaches, aiming to integrate DAOs, memes, NFTs, etc., under friend.tech through chat rooms (Clubs), providing a better user experience and environment for Web3 users.

Facing Strong Competitors, friend.tech at a Crossroads

For a newcomer in the Web3 space, friend.tech's V1 version mainly focused on how to quickly attract users. Its product innovation advantage was the monetization of social interactions, attracting a group of KOLs to join, along with a large influx of KOL fans and users under the expectation of airdrops. However, as the hype around friend.tech faded, its shortcomings became more apparent, with KOLs and the platform making money while fans continued to lose.

From current data, after the launch of friend.tech's V2, its performance has been relatively good, once again becoming a market hotspot. However, this is mainly due to the continuous release of positive news and airdrops, and the development of a community-led Web3 social network actually poses significant challenges, unlike attracting KOLs as in the V1 version. For example, Telegram, the most widely used social app by Web3 users, has various Telegram Bots at the DeFi level with rich and diverse functions, already at scale. Additionally, Telegram continues to collaborate with its previous "offspring," the Ton public chain, to expand into Web3. Telegram's Chief Investment Officer, John Hyman, stated that in the future, TON will continue to operate as an independent decentralized organization, with Telegram's focus remaining on providing an instant messaging platform. Looking at its application ecosystem, Telegram aims to become a super app similar to WeChat, naturally including various essential applications needed for Web3. Apart from Telegram, traditional apps like Facebook and Reddit have also been exploring the addition of various Web3 elements such as NFTs to their Web2 social applications.

Overall, although friend.tech has ambitious goals in the V2 version, the reality is that the challenges are significant. In the V2 version, friend.tech aims to build an encrypted social app centered around the community, friendly to Web3 users; however, this goal is actually being pursued by many projects. Considering user migration costs, friend.tech's V2 version faces tough competition from leading Web2 social apps. The real anticipation may lie in how friend.tech's monetization of social interactions can be deepened within the community.

Conclusion

friend.tech's V1 version achieved great success in the short term, but looking at long-term data, the model where the platform and KOLs profit while regular users lose has been criticized, ultimately leading to a downturn in its development. friend.tech's V2 focuses on building a Web3 community and attempting to construct an encrypted social ecosystem centered around community interaction monetization. However, facing competition from multiple Web2 social media giants (like Telegram), the challenges it faces outweigh the opportunities. Compared to Web2 social media giants like Telegram, friend.tech needs more innovation and consolidation; otherwise, it may ultimately face the fate of being forgotten by the masses.