Friend.tech Plummets 25%, Reaches All-Time Low after Declaring It Will Stay on Base L2

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As a researcher with experience in the blockchain and cryptocurrency space, I have closely followed the developments surrounding Friend.tech and the impact of their recent decision to abandon plans for migrating to their independent blockchain, Friendchain. The reversal has had a significant effect on the FRIEND token price, which experienced a sharp decline following the announcement and currently trades at less than half of its value before the initial disclosure.

As a crypto investor, I’ve been keeping an eye on Friend.tech, the decentralized social media platform built on Coinbase-backed layer 2 network Base. Exciting news came their way recently as they initially announced plans to migrate to their own independent blockchain. However, in a surprising turn of events, they’ve since decided against this move. This decision has significantly affected the value of Friend.tech’s native token, FRIEND. The reversal is noteworthy and represents an important shift in their strategy.

Impact on FRIEND Token Price

FRIEND’s value took a significant nose dive, reaching a record low of $0.2973 during Thursday morning hours, according to CoinGecko’s data. At present, the token is being transacted at $0.3521, representing a 25% decrease in comparison to the previous day’s figure. This current price point falls drastically short of Friend.tech’s disclosed intention on June 10 to leave Base and introduce Friendchain, with Friend.tech’s stock then valued at more than double this amount.

The news that the community would shift to Friendchain sparked intense discussion among members. People debated the merits and relevance of a social media-focused blockchain versus more cost-effective alternatives like Ethereum‘s Layer 2, Base. Some users raised concerns over potential higher transaction fees on Friendchain compared to Base.

The market showed instability upon the first announcement, leading to a dramatic price surge for the FRIEND token. Following the news release, the token rapidly increased by 64% within a 20-minute span, peaking at $1.31 before retracing to $0.89. On this day, Friend.tech recorded an unprecedented volume of transactions, marking a substantial increase following a prolonged plateau since its impressive debut in August 2023.

As a dedicated researcher, I’ve come across an intriguing announcement from Friend.tech made late last Wednesday. In their official statement on platform X, they confirmed that the $FRIEND token will continue to serve as a community-owned asset, pivotal for the Clubs contract. They underlined that any attempts to manipulate its supply or liquidity would go against this guiding principle. Rest assured, users can carry on establishing clubs, engaging in conversations, purchasing keys, and utilizing $FRIEND within the Friend.tech app without interruption.

Based on your feedback, we understand that you prefer for $FRIEND to remain on its current blockchain. We share your sentiment as $FRIEND was initially designed as a fully community-governed token supporting the Clubs contract. Moving the token’s supply and liquidity would not adhere to this original intention. Rest assured, you will continue to have the ability to create and interact with Clubs on the current blockchain.
— friend.tech (@friendtech) July 3, 2024

The community is closely monitoring how the price dynamics will unfold following this new decision.

About Friend.tech

Friend.tech is a social platform constructed on the second layer of the Blockchain network, using Base. This unique site prioritizes user interaction and monetization through distinctive features. At its foundation, Friend.tech provides token-restricted chats utilizing tradable tokens named “keys.” These keys grant users entry to exclusive content and potential financial benefits derived from the popularity of content creators.

The platform is equipped with a Progressive Web App (PWA) and built-in digital wallet functions, as well as utilizing a bonding curve mechanism to set important pricing levels. Friend.tech quickly gained traction following its debut. Within just 24 hours on August 19, it processed transactions worth over $1 million, surpassing the achievements of established platforms such as Uniswap and Bitcoin.

There are growing doubts about the longevity of Friend.tech due to its heavy focus on key trading and speculative value. Detractors believe this priority may undermine long-term user connections in favor of transient engagement. Moreover, Friend.tech encounters significant competition from other platforms such as Stars Arena, fan.tech, post.tech, and New Bitcoin City. These alternatives provide extra functionalities like tipping, fractional ownership, post-trading, and adjustable fees, making them attractive alternatives for users.

As an analyst, I’ve observed a persisting enthusiasm towards the platform despite increasing competition. With a market capitalization surpassing $30 million and a substantial daily trading volume of more than $2 million, it continues to attract significant investor interest.

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2024-07-04 18:05