NEW YORK – FriendTech, a novel web3 social media application operating on Coinbase (NASDAQ:COIN)’s Base blockchain, has experienced a significant drop in user activity, with a 95% fall from its peak transaction volume. The app, which allows users to trade shares of their friends using ether, initially saw a flurry of interest following its launch in August.
The platform introduced a unique concept where users could own their channels through keys that they purchased. These keys not only granted access to the channels but also enabled owners to collect fees, creating a revenue stream for both the app and the channel owner. This innovative approach branded FriendTech as a “marketplace for your friends” and quickly garnered attention in the crypto community.
Within just one week of its launch, FriendTech recorded $35 million in shares traded and attracted 110,000 unique addresses within its first month. However, recent data from Dune Analytics indicates that daily transactions have plummeted from a high of 39,000 to significantly lower levels.
Despite the rapid decline in transactions, the platform had hundreds of thousands of active users. Nevertheless, it faced criticism from figures like Beanie, who described it as an “elaborate ponzi,” referring to its use of a bonding curve on X.com.
In contrast to FriendTech’s challenges, Tom Duff Gordon, Coinbase’s Vice President, highlighted the broader potential of the Base blockchain during an appearance on Yahoo Finance UK’s The Crypto Mile. He pointed out other applications built on Base, such as a BlackRock-linked tokenized US bond ETF. Gordon emphasized that fractionalizing tokenized financial products could democratize access to financial markets and enhance liquidity and pricing. This is particularly pertinent given the increasing scrutiny and regulatory pressure on crypto assets in the United States.
Base was launched in August as an Ethereum layer 2 solution aimed at facilitating faster transactions. It has contributed to Coinbase’s diverse revenue streams which include transaction fees, custodial fees, blockchain rewards, and potential investments in anti-aging technology. Despite FriendTech’s recent downturn, Base continues to support various applications that could shape the future landscape of decentralized finance and digital assets.
h2 InvestingPro Insights/h2
In light of the recent developments surrounding FriendTech and Coinbase’s Base blockchain, InvestingPro offers some key insights. According to InvestingPro’s real-time data, Coinbase has a market cap of $22.23 billion and a P/E ratio of -29.34, reflecting its current unprofitability. Moreover, the adjusted P/E ratio for the last twelve months as of Q3 2023 stands at -18.51.
InvestingPro Tips highlight that while Coinbase’s stock price movements have been quite volatile, the company has seen a significant return over the last week. Over the last six months, the company has experienced a large price uptick, further emphasizing its strong return. Analysts, however, do not anticipate the company to be profitable this year.
Get The News You Want
Read market moving news with a personalized feed of stocks you care about.
Get The App
In terms of additional insights available on InvestingPro, there are 6 more tips related to Coinbase’s financial performance and market trends, providing a comprehensive view for potential investors and market enthusiasts.
While the recent downturn in FriendTech’s transactions is a concern, Coinbase’s broader potential, as highlighted by its Vice President, Tom Duff Gordon, suggests promising prospects for the company. The InvestingPro insights underline the importance of staying informed about the latest market trends and making informed investment decisions.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.