Tokenized social media - the new paradigm?

A brand new category of social media app launched a month ago, and you probably didn’t even notice!?

And yes, it’s built on blockchain - specifically on Base, Coinbase's new L2 network that enables scalability and low-cost transactions on Ethereum.

It’s already pulled in over $180MM of capital inflows from end users, with a current market cap of around $30MM and over 150,000 users (still early days)?

Recently, friend.tech splashed onto the scene when Paradigm announced their involvement in a seed round for a new type of viral social media platform.

So what’s the concept??

On friend.tech, you buy shares (called keys) of your friends or of influencers, which gives you access to a private chat with them.?

But wait… doesn’t this sound like Twitter creator subscriptions, or even similar to some less family-friendly apps?

Not so fast… enter the bonding curve.?

A bonding curve is like filling a balloon with air. At first, it's easy to blow up (buy tokens at a low price).?

But as it fills more and more (more tokens are bought), it gets harder to blow (price increases).?

When you let air out (sell tokens), the process reverses.?

With each key bought, subsequent keys get exponentially more expensive to buy (metaphorically speaking, not statistically. The bonding curve is a bit more complex than just an exponential graph.)?

This is a highly attractive value proposition to someone ultra-famous.?

Imagine if Taylor Swift tried connecting with all her fans on an existing premium subscription service like Twitter or Cameo

Sure, she’d make money, but it would be impossible to authentically connect with her fans in a 1:1 manner.?

If she sets the price too low, everyone will join and it will be impossible to interact authentically.?

If she sets the price too high, only very wealthy fans can join, which could cause negative PR and a negative public image among her fans.?

Friend.tech solves this with the bonding curve.?

My experience so far

Over the past month, we’ve seen a huge boom, bust, and then boom cycle as early adopters flocked to the platform for speculative purposes, left in droves once the hype ran out, and then returned weeks later only to find that they were priced out from the keys of many personalities. I spent the past month playing around with friend.tech as an early adopter to learn about this new paradigm, and attempt to separate the hype from the true innovation.?

Rather than follow what everyone else was doing, I found keys of Twitter personalities with at least several thousand followers that I’d been following for years.?

Then, I bought those keys as early as possible. In one case, it was as expensive as $400, but looking at the math of the bonding curve, I knew this was still early.?

Social psychology and game theory at work!

It was fascinating to watch how key holders interacted in the chats.?

One extra layer of complexity here is that friend.tech is offering an “airdrop” at some point in the future - basically a reward system to award early participants.?

In the past, some famous crypto airdrops such as Uniswap, dYdX, and ENS have rewarded early users with four, five, or even six figures of returns just for being an early user.?

Friend.tech has never really shared specifics on how the airdrop points are being calculated, so because of that, user psychology has been hilarious to watch.?

Some people attempt to spam chats with constant activity, thinking that this might result in more points.?

Others take a more nuanced approach, trying to share content of value, offering services, or sharing trading alpha to attract holders.?

Since friend.tech has an API, there’s even been a flurry of bots for automatically trading keys, engaging in chats, and managing your holdings.?

Personally my approach was not to trade keys at all, but to buy keys low and try to sell high.?

Of course this is easier said than done! Yesterday, I started seeing a bunch of users start using cash giveaways and raffles to try to pump their keys price, and I also started seeing a large inflow of A-list celebrities, which historically has marked a local market top in markets like NFTs.?

Thus, after sleeping on it and removing emotions from the equation, I decided to take some profits (around $3,500 worth!) and continue on with the experiment with lower stakes and still holding the keys of over 35 friends that I interact with daily.?

So what does the future hold for friend.tech?

Nobody can really know, but if the team can continue to execute and solve some of their current product infrastructure challenges, I think that this app has real staying power.?

I’m curious to see what other apps pop up in this category of tokenized social media, and I’ll likely experiment with those as well.?

As for me, I plan on continuing to stay active on friend.tech offering value to my holders in the form of 1:1 career consultation, resume reviews, and general knowledge sharing around best practices for working in Web3.?

What do you think about this new type of social media - is it really a new paradigm, or just short term hype? I’d love to hear your thoughts!?