- The past two months have seen a steady drop in user activity on Friend.tech.
- Interestingly, the protocol’s TVL continues to surge.
After an extended period of hype, decentralized social network Friend.tech has begun to witness a decline in user activity, as revealed by on-chain data from Dune Analytics.
Friend.tech hype fades
On the 6th of December, Friend.tech recorded a historic low in user activity as its single-day transaction count totaled 6,757, representing an all-time low in daily transactions. Simultaneously, the number of active buyers reached a record low of 1022 on the same day.
The demand for Friend.tech plateaued on 13th September after it clinched an all-time high daily transactions count of 539,810. Since then, network activity on the social network has declined.
Source: Dune Analytics
Users can create a group chat on the protocol, and others can mint the “keys” of that creator to join the chat. They are allowed to participate in the chat as long as they own a single key from the creator.
Per Dune Analytics data, the daily count of keys minted on Friend.tech also plummeted to an all-time low of 75 on 6th December. For the first time in the protocol’s four-month history, the total number of keys minted in a single day was less than 100.
When the Friend.tech frenzy was at its highest, single-day fees generated by the protocol climbed to an all-time high of $2 million on 14th September.
However, as the hype around the decentralized social network dwindled, the low user activity on the protocol resulted in low fees.
As of 6th December, transaction fees totaled $22,000, bringing Friend.tech’s cumulative fees to $70 million.
Source: Dune Analytics
As a result of the decline in network fees, monthly protocol revenue has dipped. Friend.tech’s monthly revenue peaked at $13 million in September, after which it began to trend downward.
In November, revenue generated from transaction fees was $2.42 million, marking an 81% decline in monthly revenue within two months.
So far this month, the social network has recorded a revenue sum of $203,000, data from DefiLlama showed.
Source: DefiLlama
This may not be the end
Despite the low user activity on Friend.tech in the past two months, its total value locked (TVL) has continued to rise.
AMBCrypto found that the protocol’s TVL initiated a rally on 22nd November and has since increased by 35%.
At press time, Friend.tech’s TVL was $38.79 million.
Source: DefiLlama
