The rise of SocialFi applications, particularly Friend.Tech, has been a notable phenomenon in the crypto bear market. These platforms have attempted to revolutionize social networking by integrating blockchain technology, offering more transparency and user control.
However, the recent data shows a significant drop in new daily users for Friend.Tech and raises questions about the sustainability of this business model.
How Friend.Tech Boosted the SocialFi Trend
Friend.Tech, a leading name in the SocialFi sector, witnessed an unprecedented surge in its user base during the initial phases of the crypto bear market. The allure of decentralized social platforms seemed to resonate with users tired of traditional social media’s pitfalls.
And, of course, there was the money aspect. Early adopters of the platform went into a frenzy, trying to buy and sell keys (essentially shares of a user) to make a quick buck. One X user quipped:
“Biggest takeaway from Friend Tech so far: Using tokens that give you access to crypto gigabrains, celebrities, and attractive women as a medium for speculation is a lot more fun than doing the same with tokens that give you access to discords with angry 30-year-old unemployed men.”
However, as of November 12, the platform has hit an all-time low in new daily users. Today, it registered just 167, despite maintaining a total value locked (TVL) of around $46 million.
This contrasting scenario of stable TVL and declining user growth is not unique to Friend.Tech but is a trend observed across the SocialFi space. Competitors like Hive, Steemit, and Minds have also experienced similar patterns.
These platforms offer various features, from content monetization to enhanced user privacy, but they all face the common challenge of sustaining user engagement amidst fluctuating crypto markets.
Read more: What is Friend.Tech? A Deep Dive Into The Web3 Social Media App
Do SocialFi Apps Have a Future?
The SocialFi model, while innovative, depends heavily on user engagement and the broader crypto market sentiment. The decline in new users might reflect a broader disinterest or skepticism toward crypto-related products, especially during market downturns.
Moreover, regulatory uncertainties and the technical complexities associated with blockchain technology pose additional hurdles. Ensuring a seamless user experience while maintaining the decentralized ethos of blockchain remains a significant challenge for these platforms.
Although Friend.Tech and its competitors initially thrived in the crypto bear market, their fruitful future is not guaranteed.
Read more: How To Monetize Your Social Media Influence On Friend.Tech
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