Friend.tech, a once-prominent crypto social network built on Coinbase's Base blockchain, has abruptly shut down, leaving investors in limbo while its creators exit with $44 million in fees. Despite generating nearly $90 million since its launch, the project’s creators have revoked their ability to make further updates, effectively abandoning the platform and raising concerns about its future. The shutdown highlights the uncertainty surrounding crypto projects and their sustainability, as users and investors are left questioning the longevity of such ventures.

• The closure of Friend.tech leaves investors grappling with losses, while the creators exit with $44 million.
• The project's creators have revoked their ability to make changes to it.
• Experts weigh in on the volatile nature of Web3 projects and the risks associated with decentralized applications (dApps).

Launched with great fanfare, Friend.tech allowed users to buy "keys" — tokens granting access to exclusive chat rooms of influential personalities. The platform quickly attracted attention, capturing over half of all activity on Coinbase’s Base blockchain. However, over the past year, the project witnessed a dramatic decline in user activity and revenue, according to data from DeFi Llama, culminating in the recent announcement that its developers have revoked any ability to update the platform or collect further fees.

As blockchain companies continue to push innovation in Web3 development and strengthen Web3 infrastructure, the unexpected shutdown of Friend.tech highlights the inherent unpredictability of Web3 projects. According to data from DefiLlama, deposits have plummeted by 92% from their peak, while daily generated fees now sit below $100. Investors who had hoped to profit from the $FRIEND token have seen their investments drop by 98% since its launch, highlighting the inherent risks in blockchain development.

The situation mirrors previous failures, such as Solidly, which was abandoned but later relaunched by another team. Some industry experts believe the protocol could still be “forked” by another group, offering a glimmer of hope for those involved.

As Web3 development continues to evolve, the future of cryptocurrency projects remains uncertain. While Friend.tech’s shutdown has shaken confidence, it also highlights the need for stronger Web3 infrastructure and more robust developments to support the long-term sustainability of blockchain companies.

Expert Opinion and Quotes

Calvin Chu, Core Builder at Impossible Finance: “Friend.Tech had become more of a lab experiment than a genuine social finance project. The decision to shut down future upgradeability feels like being rugged by the team, ending any hope for further development.” - Source

Mikko Ohtamaa, CEO of Trading Strategy: “Friend.Tech is a prime example of how quickly a project can monetize hype and then cash out. The rapid decline in user engagement and revenue reflects the volatile nature of crypto projects.” - Source

Tim Craig, DeFi Correspondent at DL News: “The closure of Friend.tech serves as a stark reminder of the risks associated with investing in decentralized applications. While the protocol remains operational, the lack of future updates raises concerns about its sustainability.” - Source

FAQs

How to use Web3?
Web3 is designed to create a decentralized internet experience, empowering users with more control over their data and interactions. Through Web3 projects like Friend.tech, individuals can engage with blockchain-based applications that prioritize transparency and security.

How does a block of data on a blockchain get locked?
Blockchain development relies on cryptographic hashing to lock blocks of data. Once a block is validated by the network, it becomes part of the immutable ledger, ensuring that information is secure and unalterable.

How can features of blockchain support sustainability efforts?
Blockchain companies are exploring ways to use the technology’s transparency and efficiency to enhance sustainability efforts. By improving supply chain tracking and reducing fraud, blockchain development can contribute to more sustainable practices across industries.