Tech
Collapse of SocialFi | Without banks
Network defects. SocialFi applications have managed to garner widespread enthusiasm among cryptocurrency natives at numerous points over the past year, but its more vibrant brands appear to be fading into obscurity. Will Cryptocurrencies Ever Have a Sustainable SocialFi Application?
The first big wave of enthusiasm for SocialFi this cycle was captured by friends.tech, an encryption-enabled private chat room on the Base L2Base is an L2 based OP Stack.See profile“ class=”stubHighlight”>Base Layer 2. Offering users a clear path to qualify for a future airdrop through one of the first implementations of a points program and directly incentivizing influencers to pay the platform via a token exchange fee of 5% paid in ETH, 
Unfortunately, the platform’s hype peaked in mid-September. Many metrics never reached the highs of this period again, and not even the arrival of the FRIEND airdrop or the V2 update managed to revive any semblance of momentum. Daily active users approached the lower limit and, on Monday, friends.tech registered 611 transactions, the lowest ever recorded and far from its all-time high of 540,000 daily transactions.
DAU technical friend up to 177 users
do you still think these are hyperfinancial social apps, anon? lol pic.twitter.com/bRsl0iKyHG
— Cheryl Douglass (@cherdougie) June 4, 2024
In late April, Blast’s crypto-native influencer trading card game “fantasy.top” rose to prominence in the Crypto Twitter lexicon after its mainnet launched to widespread acclaim from influencers who had cards on the platform.
Similar to friends.tech, fantasy.top directly incentivizes its influencers to promote the platform by offering them a 3% commission on all individual card sales and 10% of the revenue generated from initial card pack sales.
While the alignment between fantasy.top and its influencers has led to public support that has driven users to FOMO, as demonstrated with friends.tech, it can be difficult to sustain this long-term momentum as activity wanes.
Daily active users peaked on the first day of fantasy.top’s mainnet launch and have only trended downward ever since, causing the platform to produce just over a couple of ETH in revenue over the past week and drastically reducing the payments it can award to influencers.
Ironically, while activity has almost completely dissipated for the more speculative variety of SocialFi applications, usage metrics for decentralized social platforms for 
Crypto natives have demonstrated a clear demand for crypto-enabled social applications and the benefits they offer, such as easy access to on-chain interactions and robust resistance to censorship.
Financialized social applications have struggled to achieve the sustainable revenues needed to achieve long-term adoption; in the absence of this factor, each concept has faced declining usage and declining asset prices, pushing users to increasingly abandon these platforms.
While the continued adoption of Farcaster and Lens assets lends credence to the possibility that cryptocurrencies could receive a sustainable variation of a more gamified concept, the immense difficulties endured by early applications mean this will be a difficult balance to achieve.