Social app Friend.tech is hot, how are individual stocks priced?

Author: Loopy Lu

friend.tech is one of the most watched projects on the current base chain. In the long-ago “Ancient Internet” era, the “Friends Buying and Selling” mini-game was once active on major SNS sites. And Friend.tech is a Web3 product similar to the “buying and selling with friends” model.

The product ignited community discussion within one day of its launch, and according to Dune data, it has already generated more than $8 million in transactions.

What are the highlights of this popular express delivery product, and how is it different from the previous SocialFi?

Web3 Population Trading Platform

friend.tech is built on the L2 network base launched by coinbase. This product is bound with Twitter to obtain the user’s Web2 social identity. If you do not bind Twitter, you cannot use this product.

This product is too mysterious. If you visit its official website directly, you cannot get any product information. Currently, there are no product introductions, official documents, etc.

To learn more about this product, users can only access and use friend.tech via mobile phones.

In friend.tech, every user is tokenized. The influence of users can be directly priced by the market.

Specifically, users are abstracted as a cryptographic asset. A user can purchase shares of “other users”.

Why are some people willing to pay real money to buy other people’s equity? For those with strong social influence (such as popular analysts, project founders, etc.), many of their followers want to have a private conversation with them, or directly initiate a consultation.

On traditional social platforms such as Twitter, the private message function is abused because it is not restricted. KOLs will receive a large number of private message requests, and cannot process all private messages. At friend.tech it’s different. By default, users cannot have private chat conversations. For buyers, only after owning a certain person’s shares can they have the right to initiate a private chat with him. The price of shares will also fluctuate with changes in market supply and demand. Users can also resell the shares they hold to earn profits.

And for those social influencers whose shares are bought, every time his stock is bought and sold, he can earn a “subject fee”.

How do real people price stocks?

Roughly speaking, the more popular a person is and the more his stock is traded, the more his share price will be.

So specifically, how is the stock price determined? Twitter user @functi0nZer0 has put together a pricing model for the product.

As stock sales grow, prices also rise significantly. The more people buy a person’s stock, the more valuable that stock becomes.

And 5% of each sale is earned by the original “issuer” (i.e. who the stock is named). This also leads to extremely strong network effects. The more one trades and speculates on someone, the more money that person can make.

Although this product is not a KOL fan token issuance platform, its product design can not help but remind people of traditional fan tokens.

Previously, the category of “fan tokens” has always occupied a greater influence on the SocialFi track. It is generally believed that letting people with social influence issue fan tokens and empower fan tokens is a combination of social and crypto.

However, with the formation of fan token products, it is not difficult for us to find various problems in such products. On the one hand, it is difficult for fan tokens to have a deeper connection (or binding) with influencers. Oftentimes, fan tokens have no more connection to the influencers they replace than names.

The problem with this is that it is difficult for fan tokens to have liquidity in the market. These items are difficult to trade and in most cases have no investment or speculative value.

The change that friend.tech brings to social tokens lies in the fact that through the setting of the price curve, the transaction value is given to the “stock” of the influencer in terms of mechanism. Just as DEX abandoned the “order book” that requires higher immediacy, and chose the AMM mechanism. Changes in a person’s stock price do not require constant trading. Even if there is only a small amount of buying and selling activity, individual stocks will still generate sufficient fluctuations according to the price curve set in advance.

The invitation code farce reappears, and the social track leads to the same goal?

friend.tech is currently in beta, and only users with invitation codes can use it.

In addition, the user can also earn “points” when the invitation code is used. Due to the expectation of receiving airdrops for “points”, this has further attracted people’s enthusiasm for its “CX”.

But when we look back at the past history, it is not difficult to find that such social products that explode overnight and are hard to find will appear every cycle.

In 2021, the social product Monaco became popular overnight. Since this product also uses an invitation mechanism, only the invitation code can be used to register. This also caused the invitation code of the platform to reach hundreds of dollars at one time.

Earlier this year, Nostr, promoted by Twitter founder Jack Dorsey, became popular in the encryption world, and was even repeatedly discussed whether it could replace Twitter.

Social networking is one of the most core and pillar application scenarios of the Internet, and it can reach the most common and extensive C-end users. This also makes it a hot entrepreneurial field in the encryption industry.

But with the rise and fall of concepts such as SocialFi and DeSocial. Looking back at the past, users can’t help but find that encrypted social products seem to have the same fate—quick “popularity” and then silence. Of course, the same is true for Web2. I believe everyone still remembers the popularity of Clubhouse.

In the initial stage of the product, the large-scale influx of ordinary users is restricted by using the access mechanism. It is a common practice for social products to artificially raise the threshold for users and create scarcity to attract attention. But without the real needs and the precipitation of the relationship network, the initial freshness cannot determine the retention and conversion of users.

In the Web3 world, although new social protocols and applications have sprung up under the support of popular concepts such as DID and SBT, none of them has really accumulated a large number of active users after woolly expectations. The popularity of friend.tech can also How many days?