Does the decline of friend.tech disprove SocialFi? No, the real hope of SocialFi lies here
Written by: Asher Zhang
Recently, friend.tech gave upcontractThe control triggered heated discussions in the market. The team explained that this was not a runaway move. So is there still hope for friend.tech? Does the decline of friend.tech disprove SocialFi? Why is the decline of friend.tech expected?Xiaobai NavigationWhat is the real hope for SocialFi?
friend.tech is essentially bankrupt and liquidated. SocialFi should pay more attention to the "Social" part
On September 8, the friend.tech team announced that it had set the Admin and ownership parameters to 0000…000.Token FRIEND price once dropped by more than 20%. According to Coinmarketcap data, FRIEND TokenIn May this year, it was as high as nearly 3 US dollars, and the decline was as high as 97%.
Why did the market react so strongly to friend.tech? This is because friend.tech's move means that the developers of the team have given up on smartcontract的控制，协议未来将不会再有任何升级与改进，这引发市场对其跑路猜测。不过，随后团队发文称：「团队没有关闭或停止 friend.tech 网站应用的计划；之前放弃contract权限的操作主要为确保无法对部署在 Base 上的智能合约进行任何未来的更改，这些更改可能会增加或产生新的费用；这些操作不会以任何方式影响 friend.tech 网站应用的当前功能，用户所知道和使用的一切都保持不变。」
Although the friend.tech team explained that "everything remains the same", from the data point of view, friend.tech is actually unsustainable. The Block data shows that since the end of May this year, friend.tech has less than 100 daily active users; on August 7, friend.tech had only 5 daily active users, including 3 independent buyers and 2 independent sellers, a record low. From the perspective of running a company, such operating data is difficult to survive, and once its team abandons any new updates, it is even more difficult to revive. Therefore, the author believes that friend.tech has essentially gone bankrupt and liquidated. In addition, the friend.tech team has also continuously transferred ETH to Coinbase, with a total of 19,477 pieces.
friend.tech 当时红极一时，其更注重 SocialFi 中「Fi」部分，其以经济激励机制刺激用户快速迁移。但 friend.tech 的这种繁荣中更多是羊毛党，其大量发送垃圾信息赚取Token，损害真实用户的权益，最终羊毛党撸完羊毛之后，只能落寞收场。
Compared with friend.tech's competitor Farcaster, the decentralized social network protocol Farcaster pays more attention to the "Social" part of SocialFi. For example, Meme tokens have been popular recently, and Farcaster's plug-in can reach users with these messages in a timely manner, which has led to more and more Meme projects starting to publish information through Farcaster. At the same time, a large number of users have also begun to flock to Farcaster to get the most timely news. Farcaster had more than 100,000 daily active users at its peak in July this year, and it still maintains 70,000 daily active users.
Farcaster's success story is expected to carry the banner of SocialFi
Although the failure of friend.tech has disappointed the market with SocialFi, there is no need to be too pessimistic about this track. The failure of friend.tech is actually very common in the crypto market. Their commonality is that they rely too much on the stimulation of the crypto-economic mechanism. With the withdrawal of the wool party, it is difficult to maintain the false prosperity. Not only SocialFi, but also many previous projects such as GameFi are like this. For investors, they should be wary of applications that rely too much on "DeFi". In the future, projects that can truly provide practical functions will go further, and Farcaster is expected to carry the banner of SocialFi.
From the above, we can see that Farcaster pays more attention to the "Social" part, and can develop targeted application plug-ins based on the changes in the crypto market and the needs of users, so as to further capture real users. This strategy is currently very successful. In fact, Farcaster has been very pragmatic from the beginning.
Farcaster's two founders, Dan and Varun, have both held important positions at Coinbase and have rich resources in the crypto market. In the early testing phase, founder Dan used his personal influence and connections to invite many well-known OGs, including Vitalik Buterin, to join the platform. At the same time, he screened early users by obtaining invitation codes through Twitter private messages, which made Farcaster's user group have a very high "elite" concentration. Last October, Farcaster opened registration, but still set a $5 entry threshold. This move effectively blocked the registration of a large number of robot accounts and maintained the overall good atmosphere of Farcaster, which was in sharp contrast to Nostr, which had declined due to the proliferation of robots.
Farcaster founder Dan also developed a Warpcast application based on the Farcaster protocol, which currently accounts for 90% of Farcaster protocol traffic. The overall architecture of Warpcast is similar to the traditional Web2 social software Twitter. Users can post tweets (casts), comment, forward, and follow other users. In addition to social media functions similar to Twitter, Warpcast also introduced functions such as channels and actions, which derive more ways of interaction. For example, DEGEN uses the participation of users in the Farcaster ecosystem to distribute tokens. Users can participate in DEGEN's airdrops by following channels and interacting. The airdropped tokens can be given to other users as rewards.
In addition, Farcaster's huge growth this year is closely related to the Frames feature launched in February. Frames is a mini-app embedded in Warpcast, which allows users to interact in a more diverse way without leaving Warpcast, such as minting NFTs, subscribing to content, playing mini-games, and receiving tokens. For example, far.cards is a trading card project developed based on mint.club and is exclusive to Farcaster users. The attribute value of each user's card depends on their activity on Farcaster, such as the number of fans, likes and replies received, etc. The price of the card is determined by the bonding curve, and the purchased cards can be collected or traded.
Overall, the Farcaster team is indeed a team-based company in the SocialFi track. It pays more attention to the social needs of users and can carry out targeted development and design based on the characteristics of the crypto market. This is undoubtedly the key to its future success. In May, Farcaster's developer Merkle Manufactory announced the completion of a new round of financing, led by Paradigm, with a total of US$150 million, raising the company's valuation to US$1 billion. This also represents the recognition of Farcaster by the institution.
What is the real pain point of SocialFi's development? Farcaster's overlooked potential value
In fact, the real feature of SocialFi's development is still the difficulty of crypto adoption. Simply put, the main users of the current crypto market still exist in centralized trading scenarios, and there are still not many users using decentralized applications and tools. The author believes that on the one hand, the problem of fraud is indeed very serious. Although many projects want to do things seriously at the beginning, too many projects run away while they are doing them, and there are only a handful of projects that can persist in the end. This has created the impression that there are many scams in the crypto market, and users need a process of credit establishment. Traditional industries can be regulated, but the decentralization of the crypto industry makes the risk of evil very low, which makes ordinary users unable or dare not accept it. In addition, the threshold for using crypto applications is still high, which is not very friendly to ordinary novices. This is also what Ethereum will focus on solving in the next upgrade. In addition, the author believes that there is another very important issue,BlockchainThe value created by the industry itself is still relatively limited, which makes speculation (wool-pulling, etc.) still the mainstream at present, and there is no widespread real application demand.
I still believe that at presentBlockchainThe industry is in its early stages of development, and Web3 will still come in the future, which means that users will come in sooner or later. Under this assumption, Farcaster has a potential value worth noting. The founder of Farcaster was previously a senior executive of Coinbase. Farcaster is closely linked to the Base ecosystem, and Jesse, the core person in charge of the Base chain, is very active on Farcaster. Among the top 500 users with the most fans on Farcaster, more than 70% of on-chain interactions occurred on the Base chain. And Base is backed by the strong support of Coinbase, which is connected to the traditional financial market, which is very conducive to the future development of Farcaster.
The article comes from the Internet:Does the decline of friend.tech disprove SocialFi? No, the real hope of SocialFi lies here
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