2024-05-05
FriendTech's native Friend token experienced a significant drop in value, plunging from over $10 to $1 shortly after its launch.
This marked a decline of more than 90% before showing a slight recovery.
Data reveals that the token briefly traded at $169 before settling at its current value of $1.4, as reported by Dexscreener.
The web3 social media platform's native token currently boasts nearly 18,000 holders and a circulating supply of approximately 14.5 million.
During the period of the token's decline, many users on X reported being unable to claim the airdrop.
Crypto investor Luke Martin expressed frustration, stating, "Watching the value of my airdrop go from 7 figures to 5 figures in the span of 2 hours while I keep refreshing the page trying to claim...still can't claim. Adds insult to injury."
There have been speculations that the price drop may have been influenced by liquidity issues.
Liquidity refers to a market's ability to handle significant buy and sell orders while maintaining stable prices.
In low liquidity environments, a few large orders can disproportionately impact market prices.
Some users criticized FriendTech, suggesting that the liquidity problem was exacerbated by the platform's approach to fees and the addition of minimal liquidity.
One crypto trader, mcSleuth, posted, "This has to be a joke, FriendTech only added $0.01 in liquidity, so first you milk your users with fees, then u get them to add liquidity so that they can dump on each other top class team here."
However, current data from DexScreener indicates that the token's liquidity now exceeds $4 million.
Earlier today, the token became available for trading through Bunny Swap, which can be accessed via the app.
Last Friday, FriendTech launched version 2 of its decentralized social platform, accompanied by an airdrop of its native token.
Version 2 introduces "Clubs," which are community spaces owned and operated by key holders.
The transaction of Friend tokens for the keys to these Clubs incurs a 1.5% fee, which is then distributed to liquidity providers on the platform's decentralized exchange (DEX).
FriendTech initially debuted on Coinbase's Ethereum Layer 2 blockchain Base in August of last year as an invite-only networking service.
The platform utilizes social tokens called "Keys" to grant users access to exclusive chats and content from creators.
