Friend.tech Team Abandons Project, Transfers Platform Control to Burn Address – What’s Going On?

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Michael Davis

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Michael Davis

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September 9, 2024

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The future of friend.tech, a Base project once touted as the pioneer and leader of the nascent “SocialFi” crypto sector, is up in the air after the friend.tech team appeared to abandon the project, transferring control of the platform to a burn address.

As per an X post on September 7, the friend.tech team explained that this transfer of powers would “prevent and changes to their (the platform’s) fees or functionality in the future”.

But this has been widely interpreted by the crypto community as the friend.tech team abandoning the project, as future development will now be impossible.

X user VietnamPenguin called the friend.tech team’s exit an “excellent rug” by the devs and crypto VC form Paradigm.

VietnamPenguin explained that investments from Paradigm were behind the hype that saw friend.tech rake in over $60 million in fees over the last year.

Moreover, Paradigm exited ahead of the friend.tech devs, declining their allocation in the FRIEND token launch earlier this year.

Friend.tech devs appeared to attempt to calm fears about a rug pull in a new X post on September 9.

The official friend.tech X account explained they have no plans to discontinue the friend.tech web app, and the transfer of admin and ownership parameters do not impact the functionality of the web app.

Friend.tech Team Abandons Project – How Much Did They Make?

Per a DeFi Llama dashboard, the friend.tech platform has generated $63.4 million worth of fees since its August 2023 launch.

Per Arkham Intelligence, the wallet associated with the friend.tech dev team has a balance of just under $200,000 in various tokens.

But over the last eight months, this wallet has deposited $36 million in Ethereum (ETH) to Coinbase.

Another friend.tech linked wallet, meanwhile, deposited $16 million worth of Ethereum to Coinbase around nine months ago.

What Next for Friend.tech?

In the lead up to the friend.tech team abandoning the project, friend.tech had seen stagnant activity for months.

After making as much as $2 million per day in September 2023, the project’s revenues barely exceeded $2,000 daily in July and August 2024, per DeFi Llama.

Meanwhile, the FRIEND token that the project launched back in May continues to trend towards zero.

After momentarily reaching as high as $3 right after its launch in May, FRIEND was last at $0.08, per DEXTools.

A 99% decline in daily fees and in the token price sends a strong signal that friend.tech is dead.

And with the friend.tech team having abandoned the project and no changes to the protocol ever possible, no comeback is ever likely.