Friend.tech, the latest decentralized social media (DeSo) app in the crypto space, has faced harsh criticism for its decision to penalize users who choose to use forks or imitations of its tokenized social media platform.
In a tweet on Aug. 28, the official Friend.tech X account stated, “To ensure loyal users are justly rewarded during our beta, users transitioning to forks and copies will automatically be excluded from earning Points and will lose existing points.” Although Friend.tech did not reference any particular rivals, several X users in the replies highlighted a new DeSo or “SocialFi” app named Shares, set to launch its public beta on Aug. 31. Friend.tech has been distributing “reward points” to its beta testers weekly, amounting to a total of 100 million points over six months. The team has not yet disclosed the ultimate purpose of the points, only hinting on Aug. 15 that it “will serve a special purpose when the app is officially released.” Some speculate that it may convert to tokens for friend.tech governance, while others think it may hold monetary value for users. Others anticipate a friend.tech native token airdrop in the future due to the seed investment from Paradigm.
The announcement was not well-received by the crypto community.
Within an hour of posting the announcement, it garnered hundreds of negative comments and reposts condemning the app for its anti-competitive stance. CryptoKaleo, a pseudonymous trader, responded to the announcement, stating, “Threatening/penalizing users for testing other platforms is entirely against the principles of this industry.”
Another comment read, “This is a textbook example of how not to address competition in Web3 lol — looking forward to the apology in a few hours.”
Following the severe backlash, Friend.tech‘s pseudonymous founder “Racer” retracted the previous decision in an apology statement released from the official X account of the social media app on Aug. 29.
Racer reversed the decision, admitting it was a “foolish statement” made out of fear of potential competition for the Friend.tech app. This announcement came less than three weeks after its public launch on Aug. 11. Meanwhile, Friend.tech experienced a decline in key metrics such as activity, inflows, and volume in the recent days.
As of the time of publication, transactions on Friend.tech have plummeted over 90% from its peak of nearly 525,000 transactions on Aug. 21, to less than 50,000 cumulative transactions on Aug. 28, as per data from Dune Analytics.