A new Token Terminal report was released on Sept. 14 on the meteoric rise of Friend.Tech (FT) reveals critical factors driving the app’s growth.
Timing the launch with Base’s debut proved crucial, with Base now boasting 400k+ users. FT quickly became Base’s biggest gas guzzler, consuming 20% of total gas. The instant liquidity and audience on Base jumpstarted network effects.
Token Terminal further found that the expertise of FT’s co-founders was crucial, as their backgrounds in viral social media primed them to engineer an addictive experience. Though their identities are pseudonymous, the report notes they have a proven track record of launching successful apps. The anonymous founders planned FT’s viral growth by focusing on creator monetization and exclusivity.
Celebrity influencers were enlisted early, lending social proof. Getting 70% of crypto influencers with 50k+ followers onboarded demonstrated substantial product-market fit. The network clustered around high-value individuals first, akin to a clubhouse.
Viral loops and gamification propelled growth through speculation and token incentives. Following the playbooks of Blur and LooksRare, trading volume exploded. Although dependent on speculation, incentivization was mandatory for ignition.
User retention figures are far above comparisons with other Web3 or Web2 social media applications, as over 70% of users return the next day and 50% return after 7 days.
Revenue becoming detached from operations was a boon for FT, according to Token Terminal. Automated marketplace fees require zero marginal effort from developers. Self-perpetuating creator monetization is a killer combination.
The app’s Progressive Web App (PWA) architecture was integral for bypassing gatekeepers. Without app store tolls, FT and creators keep all value created. This level of margin allows generous revenue sharing to incentivize creators.
Price curve innovation reinforced positive feedback loops. Exponential price growth with scarcity propagates hype and speculation while improving user experience. Lower key-to-holder ratios increase exclusivity.
Thus, despite doubts about sustainability, FT is the fastest-growing social dApp ever.
Analyzing the ingredients of its viral cocktail provides a blueprint for decentralized social apps to come. With the right strategy, execution, and circumstances, the pace of adoption can astonish even the most optimistic observers.
Token Terminal’s report illuminates the immense latent demand for creator monetization through crypto-native social experiences. The full report is available on the Token Terminal website.
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