Layer-2 Blockchains: The Rise Of Decentralized Social Finance
Network Activity rises for Artibrum and Base, as more people tokenize their X profiles on Layer-2 applications like Friend.tech and Post.tech.
Where's The Trader(s) At?
There's a new catchphrase in Crypto: Tokenize your X profiles, Transform your online identity into a tradable asset.
Friend.tech Takes Center Stage
Making waves since its August debut, Friend.tech invites users to buy "Keys" of other individual’s personality on its platform. In exchange? You gain access to an exclusive access to a chatroom with the individual.
For Curious, the Netflix Show “Black Mirror” had an episode of the same sort, “Nosedive ( Season 3, Episode 1)”, and we all know how every Black Mirror episode ends.
Back to the story! Friend.tech is riding a wave of ups and downs in network activity, but gained viral attention following its launch back in August. The numbers don't lie: this platform once drove half a million daily transactions on Base, amounting to a whopping 37% of Base's transaction volume. That's not all - it funneled a flood of new users and money into the new chain, Base.
This buzz did not go unnoticed, leading to a ripple effect of emerging platforms eager to capitalize on its success and harness the potential of social finance, entering Post.tech.
Friends & Rivals
In FOMO, Post.tech threw its hat in the ring. Boasting more than $5.2 million in 24-hour trading volume, it's a formidable SocialFi challenger to friend.tech. While they share the goal of decentralized social interaction, they’re at Rivalry in their approach:
Platform: Friend.tech is built on Ethereum’s Layer 2 network Base, while Post.tech on Arbitrum.
Privacy: Only channel owners see all messages on Friend.tech. Everyone sees everything, On Post.tech.
Rewards: On Friend.tech gets you points. Post.tech, with high liquidity hands out cold hard cash based on how active you are.
Both offer token-gated channels where users pay a substantial 10% fee on transactions, half to the app and half to the channel’s owner.
Right Place, Right Time
In February 2023, Coinbase finally launched of Base – an Ethereum L2 built on the OP Stack. When Base launched, it was met with skepticism as it was yet another L2 in an already crowded field. The community didn’t have to wait long before a mania emerged: Friend.tech.
Friend.tech has onboarded 443,449 users and $44.39 million to the Base ecosystem, at the time of writing. This surge marked a shift in its competition with other chains since Base's transactions exceeded five times more transactions than other second-layer solutions.
Pirates In Sight
The rise of Friend.tech has been lucrative for some — with daily revenues currently in the hundreds of thousands. As a result, new platforms — inspired by Friend.tech’s model — have started to spring up across various blockchains, yet the longevity of SocialFi remains an open question.
Catch Ya Later, Friend!
The community remains unsure about SocialFi’s future structural components, such as bonding curves and private chats. However, mainstream platforms like X (formerly known as Twitter), are reportedly interested in crypto-monetization, suggesting that Friend.Tech might be on the right path. SocialFi will stick around one way or another. Although, Some are in for a quick buck. But hey, who can blame them?
As the line between social networking and finance blurs, one wonders: are we just trading friends now?