Friend.Tech V2 is coming. Will SocialFi make a comeback?

Author: David C; Translator: TechFlow

With the upcoming release of the brand new friend.tech, SocialFi has once again become a hot topic of discussion in the cryptocurrency space.

The word SocialFi may bring to mind BitClout and DeSo, the crypto-native Twitter alternative that had its moment in the spotlight in 2021. However, BitClout quickly lost its real appeal and was overshadowed by DeFi, NFTs, and DAOs, with many believing that SocialFi is still too early.

However, certain NFT projects and DAOs are currently the best examples of successful SocialFi, creating social networks that incorporate DeFi, with amazing staying power, and arguably laying the foundation for this round of "Meme Coin" SocialFi.

With friend.tech V2 approaching, let's take a look at the current state of SocialFi development, what's still missing in this space, and whether friend.tech's upcoming release can make an impact.

friend.tech V1 and the Meme Coin Craze

friend.tech was launched in August 2023 and allows users to buy and sell “Keys” associated with Twitter accounts.

These Keys are effectively passes to private in-app chatrooms and exclusive content, effectively monetizing social interactions. Within just two weeks of launch, the platform attracted over 100,000 users and generated approximately $25 million in revenue, marking a significant achievement in terms of user adoption and financial performance.

While the monetization of social interactions is not an entirely new concept, friend.tech presents a new form of SocialFi through its implementation of a social token system.

Friend.tech’s Keys are more than just passes, they leverage the natural human tendency to rally around charismatic individuals, effectively combining the powerful force of social coordination with economic incentives to create a unique and powerful mechanism for community engagement and cohesion.

However, despite the impressive initial traction, friend.tech fell into a slump in October last year, with low activity and revenue until the recent V2 release.

Interestingly, during the period of low activity on friend.tech, meme coins took the industry by storm, planting dogs, cats, and hats (some meme coin characteristics) in crypto Twitter and media headlines.

These tokens have flourished primarily on Solana, and have also had some success on Base, where transactions are faster and cheaper, allowing everyone to participate, while the high costs of Ethereum L1 may have hindered participation for many.

Meme coins swap out friend.tech’s SocialFi for a sillier, more fun type, but still SocialFi. Meme coins have long been compared to NFT collections, and I believe this is because they both create the same unique social network on our timelines. Dogs and hats, and dogs wearing hats, identify the holders as a distinct group of people, just as Milady PFPs and their frenetic tweeting style identify the holders as a distinct group of people.

Other similarities between the two asset classes can be seen in the recent launch of DEGEN L3, and the subsequent announcements of Azuki and BAYC L3. Meme coins have even sparked similar initiatives to those seen with DAOs in the last cycle, with WIF’s crowdsale for the Las Vegas Ball recalling ConstitutionDAO and its crowdsale auction attempts.

Friend.tech is here again

While SocialFi has existed in different forms over the years, it has always been here.

SocialFi’s fragmentation across different blockchains, with NFTs on Ethereum and Meme coins on Solana, has hindered its appeal as a dominant trend. While each blockchain has fostered its own unique form of SocialFi, the lack of a unifying platform has hindered a coherent growth trajectory, with many dissecting them as separate trends rather than as part of SocialFi.

Friend.tech still has a chance to change all that.

Friend.tech V2 is launching later this week, packed with features designed to bring together the NFT community, DAO, and meme coin social trends.

As a participant in the friend.tech founder Racer chat group, crypto investor John Wang summarized the many new features that V2 will bring to enhance user engagement and personalization. Let's take a look at what's new in advance.

For Groups

Room owners can customize their chat space aesthetically and functionally with options like voting, raffles, and visual themes.

They can create Money Clubs, which enable groups to manage shared finances and mint tradable on-chain collectibles, meme coins, and a host of other media - generating additional income for the group. To support this, friend.tech will also have a native decentralized exchange, a hub for trading all of these assets, which may be its biggest upgrade.

The chatroom as a whole will become more dynamic, with reactions and tagging, an enhanced notification system, pinned messages, sweepstakes, and referral programs being introduced, the latter of which is entirely in line with how crypto is evolving and how people are engaging with it.

These tools are designed to increase interaction within the platform and keep users active and engaged in their communities.

For the Platform

The platform will also see improvements, including new discovery features, enhanced keyword search capabilities, personalized recommendations for key purchases, and other user-specific suggestions.

Given the criticality of security in crypto, V2 will also feature integration with cold wallets for enhanced security and two-factor authentication. Combined with performance improvements like faster loading speeds, this will expand the market friend.tech can serve, potentially leading to increased adoption.

Overall, the V2 update provides a better user experience and a comprehensive environment that unifies all successful SocialFi iterations to date (NFTs, DAOs, and Memecoins) into one unique ecosystem.

Bringing all of these verticals together under friend.tech will showcase how NFTs, DAOs, and memecoins have already replaced instances of SocialFi and potentially provide a dedicated environment for SocialFi, solidifying its position as an ongoing trend.

Redefining SocialFi

SocialFi has demonstrated its already pervasive yet fragmented existence across multiple blockchains through its various manifestations, from Ethereum NFTs to Solana-based Memecoins. Each iteration, while successful in its own right, has been limited by environmental separation, hindering the unified advancement of SocialFi as a coherent trend.

But with the launch of friend.tech V2, that could all change.

By providing a comprehensive platform, friend.tech V2 has the potential to consolidate these fragmented assets into a unified and powerful network. This unified environment could firmly establish SocialFi as a dominant trend in our industry.

That being said, with a much-anticipated airdrop coming up, friend.tech will need to maintain the market's attention in order to achieve this goal. Nonetheless, given the host of upgrades that V2 will bring, I personally believe it will.