AFTER FRIEND.TECHS FAILURE, SOCIALFI MUST CROSS THE CHASM TO SUCCEED

Last updated: June 20, 2025, 00:16 | Written by: Barry Silbert

The world of decentralized social media, often dubbed SocialFi, promised a revolution: giving users control over their data, privacy, and monetization. After Friend.tech s failure, SocialFi must cross the chasm to succeedPlatforms like Friend.tech emerged, linking themselves to established social networks like X (formerly Twitter), hoping to ride a wave of hype and bring this vision to life. SocialFi and trading merge at Pulsewave private event: Key highlights from Token2025 SocialFi must cross the chasm to succeed . In the wake of Friend.tech s collapse, CointelegraphFriend.tech, in particular, saw a meteoric rise, attracting significant attention with its unique approach of tokenizing relationships.Users could buy and sell ""keys"" (formerly ""shares"") associated with individuals, creating a speculative market around social influence. After Friend.tech s failure, SocialFi must cross the chasm to succeed UTC The social finance (SocialFi) sector can learn valuable lessons from the collapse of Friend.tech, helping to drive the next generation of projects to sustained long-term success.However, this rapid ascent was followed by an equally dramatic fall.Daily activity and transaction volume plummeted, leading to questions about the long-term sustainability of the platform and the broader SocialFi ecosystem. After Friend.tech s failure, SocialFi must cross the chasm to succeed Septem - By Cryptonewone In the wake of Friend.tech s collapse, Cointelegraph spoke with industry leaders to find out what went wrong and what comes next.The failure of Friend.tech, while disappointing, presents a crucial learning opportunity.The SocialFi sector needs to evolve beyond fleeting hype and address fundamental challenges to achieve mainstream adoption.This article delves into the lessons learned from Friend.tech's collapse and explores the path forward for SocialFi to cross the chasm and realize its true potential.

Understanding Friend.tech's Rise and Fall

Friend.tech's concept was undeniably innovative.By linking social interaction with financial incentives, it aimed to create a new kind of social experience. Though only Friend Tech has closed shop, Farcaster has suffered, with just 142 DAU now visiting the platform. Despite constant usage by Ethereum co-founder Vitalik Buterin, Farcaster has been unable to compete with Web2 alternatives like X and Facebook.The idea was simple: users could buy ""keys"" representing ownership in another user's ""room"". In the wake of Friend.tech s collapse, Cointelegraph spoke with industry leaders to find out what went. Markets One News Page: MondayThe price of these keys would fluctuate based on supply and demand, theoretically rewarding early adopters and those who accurately identified influential individuals.

Early Hype: The platform initially experienced explosive growth, driven by a combination of novelty, speculation, and the allure of financial gain.
X Integration: Friend.tech's integration with X proved crucial in its early success, allowing it to leverage X's existing user base and network effects.
Tokenization of Relationships: The concept of tokenizing relationships, while intriguing, also introduced an element of gamification and financialization that ultimately proved unsustainable.

However, the initial excitement soon waned.Several factors contributed to Friend.tech's decline:

Unsustainable Economics: The platform's fee structure and reliance on speculative trading made it difficult for users to generate sustainable income.
Lack of Intrinsic Value: Beyond speculation, the keys offered limited utility or intrinsic value, leading to a decline in demand as the hype faded.
High Gas Fees: Transactions on the platform incurred gas fees, making frequent trading expensive and discouraging smaller users.
Centralization Concerns: Despite being built on a blockchain, Friend.tech exhibited certain centralized aspects, raising concerns about censorship and control.

Key Lessons for SocialFi from Friend.tech's Demise

The failure of Friend.tech provides valuable insights for the future of SocialFi. Friend.tech's collapse offers key lessons for the SocialFi industry, potentially driving the next wave of enterprises toward sustainable, long-term success.To succeed, new projects must address the shortcomings of earlier platforms and build more sustainable and user-friendly ecosystems.

1. The social finance (SocialFi) sector can be taught beneficial classes from the collapse of Good friend.tech, serving to to drive the subsequent technology of initiatives to sustained long-term success. SocialFi reimagines social media with decentralized constructions, promising customers better management over their knowledge, privateness and monetization alternatives. Good friend.tech linkedBeyond Speculation: Creating Real Value

One of the most critical lessons is the need to move beyond pure speculation.While financial incentives can attract initial interest, they cannot sustain a platform in the long run. Friend.tech linked its decentralized social media platform to X, catching a hype wave from August 20. But its token s price crashed in May and was effectively pronounced dead inSocialFi projects must offer genuine value to users, such as:

Enhanced Content Creation Tools: Providing creators with tools to produce higher-quality content and engage their audience more effectively.
Improved Community Management: Facilitating stronger community building and interaction among users.
Direct Fan Engagement: Enabling direct communication and collaboration between creators and their fans.
Exclusive Content and Experiences: Offering exclusive content, experiences, or benefits to key holders.

Instead of simply trading keys, users should be able to use them to unlock access to premium content, participate in exclusive communities, or directly support their favorite creators. The rapid rise and equally dramatic fall of Friend.tech, a platform that promised to revolutionize social media through tokenized relationships, serves as a Tech Artificial IntelligenceThis shift from speculation to utility is crucial for building a loyal and engaged user base.

2. In the wake of Friend.tech s collapse, Cointelegraph spoke with industry leaders to find out what went wrong and what comes next.Weiter zum vollstScalable and User-Friendly Platforms

Web3 platforms are often criticized for being complex and difficult to use. Ultimately, Friend.tech failed to sustain the daily activity and transactions it enjoyed during its brief period of hype. To be fair, Friend.tech showed the Web3 industry the potential ofSocialFi projects must prioritize user experience (UX) to attract mainstream users. In the wake of Friend.tech s collapse, Cointelegraph spoke with industry leaders to find out what went wrong and what comes nextThis includes:

Simplified Onboarding: Making it easy for new users to sign up and get started, even if they have no prior experience with blockchain technology.
Intuitive Interface: Designing a user-friendly interface that is easy to navigate and understand.
Mobile-First Approach: Optimizing the platform for mobile devices, as most users access social media on their phones.
Lower Transaction Fees: Minimizing transaction fees to make the platform more accessible to smaller users.

Furthermore, SocialFi platforms need to be scalable to handle a large number of users and transactions without compromising performance.This requires careful consideration of the underlying blockchain infrastructure and optimization of the platform's architecture.

3.Building Trust and Security

Security is paramount in the Web3 space. In the wake of Friend.tech s collapse, Cointelegraph spoke with industry leaders to find out what went wrong and what comes After Friend.tech s failure, SocialFi must cross the chasm to succeedSocialFi projects must prioritize security to protect users' data and assets. After Friend.tech s failure, SocialFi must cross the chasm to succeed cointelegraph.comThis includes:

Robust Security Audits: Conducting regular security audits by reputable firms to identify and address potential vulnerabilities.
Smart Contract Security: Ensuring the security of smart contracts through rigorous testing and formal verification.
Data Privacy: Implementing robust data privacy measures to protect users' personal information.
Transparency and Accountability: Being transparent about the platform's security practices and being accountable for any security breaches.

Building trust is also essential.Users need to be confident that the platform is reliable, fair, and not susceptible to manipulation.This requires open communication, clear governance, and a commitment to ethical practices.

4. Friend.tech linked its decentralized social media platform to X, catching a hype waveSustainable Economic Models

The economic models of many early SocialFi projects were unsustainable, relying heavily on speculation and high fees. cointelegraph.com: In the wake of Friend.tech s collapse, Cointelegraph spoke with industry leaders to find out what went wrong and what comes next.To succeed in the long run, SocialFi platforms need to develop more sustainable economic models that:

Reward Creators Fairly: Providing creators with a fair share of the revenue generated by their content.
Incentivize Engagement: Encouraging users to actively participate in the community and contribute valuable content.
Diversify Revenue Streams: Exploring alternative revenue streams beyond transaction fees, such as advertising, subscriptions, or partnerships.
Community Ownership: Empowering the community to participate in the platform's governance and decision-making processes.

A well-designed economic model can create a virtuous cycle, where creators are incentivized to produce high-quality content, users are engaged and rewarded for their participation, and the platform itself becomes more valuable over time.

5.Navigating Regulations

The regulatory landscape for Web3 and SocialFi is still evolving.SocialFi projects need to be aware of the potential legal and regulatory risks and take steps to comply with applicable laws and regulations.This includes:

Understanding Securities Laws: Determining whether the platform's tokens or keys are considered securities and complying with relevant securities laws.
Data Privacy Regulations: Adhering to data privacy regulations, such as GDPR and CCPA.
Anti-Money Laundering (AML) Compliance: Implementing AML procedures to prevent the platform from being used for illicit activities.
Working with Regulators: Engaging with regulators to ensure that the platform is compliant and to shape the future regulatory landscape.

Proactive engagement with regulators can help SocialFi projects navigate the complex legal environment and build a sustainable business model.

The Future of SocialFi: Crossing the Chasm

The failure of Friend.tech, while a setback, does not spell the end of SocialFi. Edit Recent News Activity Section. News . Coin Telegraph After Friend.tech s failure, SocialFi must cross the chasm to succeedIt serves as a crucial learning experience, highlighting the challenges that need to be addressed for the sector to cross the chasm and achieve mainstream adoption.The future of SocialFi depends on its ability to:

Focus on Utility: Shift from speculation to providing real value to users through enhanced content creation tools, community management, and direct fan engagement.
Improve User Experience: Make platforms more user-friendly and accessible to mainstream users.
Build Trust and Security: Prioritize security and transparency to build trust among users.
Develop Sustainable Economic Models: Create economic models that reward creators fairly and incentivize engagement.
Navigate Regulations: Proactively engage with regulators to ensure compliance and shape the future regulatory landscape.

Platforms like Farcaster, despite facing their own challenges in competing with Web2 giants like X and Facebook, are still actively developing and exploring new approaches to decentralized social media. After Friend.tech s failure, SocialFi must cross the chasm to succeed Coin Telegraph 46 minutes ago 34 In the wake of Friend.tech s collapse, Cointelegraph spoke with industry leaders to find out what went wrong and what comes next.Even with the continuous usage of Farcaster by Ethereum co-founder Vitalik Buterin, these platforms need to innovate beyond pure decentralization and provide compelling reasons for users to switch from established social networks.

Examples of Promising SocialFi Projects

While Friend.tech's model proved flawed, several other SocialFi projects are exploring different approaches and showing promise:

Mirror: A decentralized publishing platform that allows writers to own their content and monetize it directly.
Lens Protocol: A composable and decentralized social graph that allows developers to build a variety of social applications.
Deso: A blockchain specifically designed for social applications, offering features like content monetization and decentralized identity.

These projects are focusing on providing creators with more control over their content, building stronger communities, and creating new ways to monetize their work.They represent a new generation of SocialFi platforms that are learning from the mistakes of the past and building towards a more sustainable future.

The Role of DAOs in SocialFi Governance

Decentralized Autonomous Organizations (DAOs) can play a significant role in the governance of SocialFi platforms.By giving users a say in the platform's development and decision-making processes, DAOs can help ensure that the platform is aligned with the needs of its community.

DAOs can be used to:

Vote on new features and updates.
Allocate funds from the platform's treasury.
Moderate content and enforce community guidelines.
Elect representatives to the platform's governing body.

By empowering users to participate in governance, DAOs can help build more democratic and sustainable SocialFi platforms.

Is SocialFi a Fad or the Future of Social Media?

The question remains: is SocialFi just a fleeting fad, or does it represent the future of social media?While it's impossible to predict the future with certainty, several factors suggest that SocialFi has the potential to disrupt the existing social media landscape:

Growing Demand for Data Privacy: Users are becoming increasingly concerned about their data privacy and are looking for alternatives to centralized social media platforms that collect and monetize their personal information.
Creator Economy Boom: The creator economy is booming, and creators are looking for ways to own their content and monetize it directly, without relying on intermediaries.
Decentralization Trend: The broader trend towards decentralization is driving innovation in various sectors, including social media.

However, SocialFi still faces significant challenges, including user experience, scalability, security, and regulation. 2 likes, 0 comments - trigo.army_official on Septem: After Friend.tech's failure, SocialFi must cross the chasm to succeed! Key challenges: 1️⃣ Clear value beyond speculation 2️⃣ Scalable user-friendly platforms 3️⃣ Strong trust security 4️⃣ Sustainable economic models 5️⃣ Navigating regulations The future of decentralized social networks depends on realOvercoming these challenges is crucial for SocialFi to achieve mainstream adoption.

Conclusion: Building a Sustainable SocialFi Ecosystem

The failure of Friend.tech serves as a wake-up call for the SocialFi industry.It highlights the need to move beyond hype and speculation and focus on building platforms that offer real value, prioritize user experience, ensure security, and develop sustainable economic models.The sector can learn valuable lessons from the collapse of Friend.tech, potentially driving the next wave of enterprises toward sustainable, long-term success.

To truly cross the chasm and become a mainstream alternative to traditional social media, SocialFi must:

Provide tangible benefits beyond financial incentives.
Be incredibly easy to use, even for non-crypto natives.
Prioritize security and user trust.
Develop sustainable revenue models that benefit both creators and users.
Address regulatory concerns proactively.

The future of decentralized social networks depends on real innovation and utility.By addressing these challenges, SocialFi can fulfill its promise of empowering users, fostering creativity, and building a more equitable social media ecosystem. After Friend.tech s failure, SocialFi must cross the chasm to succeed I'm sorry, but I need more information or the actual content in order to provide a summary. Other News from TodayIt's time for SocialFi to learn from the past and build a more sustainable and user-centric future.Let's hope that the next generation of SocialFi platforms can learn from these valuable lessons.