Over the past 24 hours, the price of Friend.tech’s FRIEND token has dropped by 30%, reaching $0.06 as of September 9, 2024. This significant decline follows a major development wherein the project’s development team transferred governance and control of its smart contracts to an Ethereum Null address.
A Null address in blockchain is essentially a dead-end address, meaning that once assets are sent there, they cannot be retrieved or altered. For Friend.tech, this transfer effectively locks its smart contracts, making them immutable. Any future changes or updates to the system are now impossible. Users and investors are particularly concerned as tokens sent to this address are unrecoverable, and the transfer represents a permanent relinquishment of control by the development team.
The move took place on September 8, marking a significant turning point for Friend.tech. Serpin Taxt, developer of the Ethos blockchain, described the move as “the end of an era,” emphasizing the importance of this event.
The Friend.tech team had previously announced plans to develop their blockchain, Friend.chain, just three months ago. This made the sudden decision to transfer control all the more confusing for the project’s community. Adding to the uncertainty, the announcement of the smart contract relinquishment was posted and then deleted on the project’s official account, leading to further frustration and speculation among users.
This confusion adds to ongoing conflicts within the Friend.tech community, particularly following a problematic FRIEND airdrop in May. Since then, the project’s value has plummeted, with the market cap decreasing nearly 40 times—from $240 million at its peak to just $6 million today.
The project’s overall health seems to be rapidly declining. According to data from DeFiLlama, the total value locked (TVL) on the platform has fallen from $52 million in October 2023 to a mere $3.5 million in September 2024. Friend.tech, once a leading SocialFi project on the Base Layer 2 network, allowed creators to monetize their content through the use of “keys” and gained significant popularity by the end of 2023.
However, the platform’s success was short-lived. By 2024, it struggled to maintain operations, and the launch of V2 in May failed to generate the expected user interest.
Data from The Block further confirms the project’s downturn. Protocol fees for Friend.tech have now dropped to less than $1,000 per day since the end of July, while FRIEND’s transaction volume has significantly decreased during the same period.
For many, Friend.tech’s latest move signifies more than just the fall of a single project—it could indicate a setback for the broader SocialFi trend, which combines decentralized finance (DeFi) and social media to allow users to monetize their social presence. Friend.tech was once considered a leading contender in the SocialFi space, along with other projects like Farcaster and Cyber Connect.
It’s not just Friend.tech facing difficulties. Cyber Connect’s CYBER token has also experienced a significant decline in recent months, losing nearly 80% of its value, from $15 to $3.1 at the time of writing.
As Friend.tech’s prospects grow dimmer, the community is left to grapple with its sudden shift in strategy and the irreversible changes to its governance. The platform, once celebrated as a pioneer in the SocialFi space, now faces an uncertain future. Investors and users are left wondering whether this marks the end of the line for Friend.tech or if a new chapter could still emerge amid the turmoil.
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