Network migration causes token to plummet 22%

The Friend.tech platform became a cause for concern recently when its monetization strategy began to attract negative attention from regulators.

The situation worsened with the news of the migration of the Base Layer 2 (L2) blockchain in collaboration with Conduit, which the community did not receive well. Immediately after the announcement, the protocol’s native token, FRIEND, fell 22% to $0.6862, a drop of 22.95% in the last 24 hours.

Launched almost a year ago on Base, an Ethereum layer 2 network powered by Coinbase, Friend.tech quickly rose to prominence for its unique approach to social interaction and monetization.

However, the project’s monetization strategy has raised concerns about possible negative attention from regulators, leading the protocol to seek alternatives to the Base blockchain.

On June 9, Friend.tech announced a collaboration with crypto infrastructure startup Conduit, beginning the migration to a new blockchain called Friendchain.

Users were invited to secure a spot on the Friendchain testnet, which would qualify them for a FRIEND airdrop. Despite the promises, the migration generated discontent among community members.

Friend.tech performs migration

Many cryptocurrency enthusiasts questioned Friend.tech’s move to Friendchain. The Giver, an influential X user, highlighted that it was too early for the project to consider such a migration.

Another user, Dr. Kojipup, questioned the value proposition of a socially focused network, while the commenter known as “ox0” questioned the need for a new blockchain. Pop Punk, co-founder of gas auditing firm Gaslite, also expressed skepticism, asking “why”.

These issues reflect significant community dissatisfaction with migration. And this resulted in a sharp drop in the price of the FRIEND token.

At one point on Sunday, the token saw a brief spike to $1.29. However, the increase was not sustained. And this resulted in a sharp drop. At the current level, the FRIEND price is 60% below the value recorded in May. Furthermore, it is just 1.8% above its historic low.