How does Friend.tech make socialization the new online luxury item?

How has Friend.tech revolutionized socialization into the ultimate luxury commodity of the digital age?

Author: Hill

Translation: Qianwen, ChainCatcher

This article is not intended to praise Friend.tech, as the author does not believe that its current form can reach the level of replacing Twitter (perhaps that was not its original intention). However, it does provide a boost to social media with luxury features and has the potential to inspire the development of a new generation of online luxury experiences.

What is Friend.tech?

There are already many explanations of how Friend.tech works, but this article will only focus on some common misconceptions seen in the community.

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Misconception 1: Friend.tech is an exclusive content platform – it may appear so, but it is not the best use case in this regard. Apart from ongoing subscription revenue, it is challenging to sustain exclusive content through other means. Long-term development requires constant production of high-quality content. To minimize information arbitrage, maintaining a uniform user cost is essential. Friend.tech does not provide creators with ongoing subscription revenue; on the contrary, it only allows income through transaction fees.

Misconception 2: Friend.tech is a platform for creators to gain popularity – yes, creators can appear on the “popular” or “trending” lists. However, as the price of keys rises, the number of users who can afford them decreases, resulting in fewer users who can access the creators’ content, thus limiting user expansion.

To understand what Friend.tech really is, let’s start with the main difference between Friend.tech users and regular social media users. It is worth noting that Friend.tech users consider the funds spent on purchasing keys as an investment rather than an expense. When they invest their money, they feel like they are fully supporting the creators with the entire investment amount, not just the 5% transaction fee.

Therefore, I believe that Friend.tech is a social platform with luxury attributes, where users can have the opportunity to engage deeply with creators through their investment.

Luxury Attributes

The definition of luxury varies, and some people define it from the perspective of luxury products: the demand for luxury products increases as their prices rise. Others refer to it as “Veblen goods,” which are similar to luxury products and also affect the social status associated with owning/using the item. One interesting phenomenon we see in luxury products is that users pay a price far exceeding the pure utility of the product. Designer bags and regular bags can both carry a lot of things, but the premium of the former goes beyond its utility, as it represents a certain identity. Friend.tech exemplifies this well. The cost of buying a key is high, and as the price of a person’s key increases, there are more buyers chasing profits. It becomes a symbol of identity. Creators compare the prices of their keys, and higher-priced keys have more show-off capital. People feel like they are buying the key at the full price, but in reality, they only pay a 5% fee, which is much lower than the total investment amount for purchasing a key.

Social Attributes

Friend.tech is an interesting social platform. Only when users hold the creator’s key can the creator and user communicate with each other. Users cannot directly communicate with other users. Creators can talk to all users. The status between users and creators is not equal. On the contrary, creators are at the top and can access all information, while users can only access limited information published by creators.

Investment Attributes

Users don’t invest X dollars once/month, but invest 100 times X dollars. This amount is much larger, and the user’s interest is closely related to the content they invest in. This symbolizes trust, and if the investment makes money, users can also reduce the actual cost of using the platform.

Opportunities for in-depth communication with creators

It is not difficult to establish contact with creators. Users can message creators on Twitter or leave comments under their tweets. However, it is challenging to establish a deep connection with creators. Because it cannot be guaranteed 100% that when users send messages to creators, the creators will see and reply to them.

Friend.tech has created such a platform. This is not the first platform that “pays for the creator’s time”. If users want to attract the attention of creators, LianGuaitreon and OnlyFans are good platforms. However, LianGuaitreon and OnlyFans are not a market, and creators do not have an easy way to set “appropriate” entry barriers for users. They usually price arbitrarily, which cannot attract the right audience. Friend.tech sets the entry barrier based on the price of the key. The priority of users is judged by the price of the key, which measures the intensity of their intention to talk to creators. Ownership of the key represents an exchangeable item that grants the right to have a conversation with the creator.

In conclusion, we can see the first example of creating a market based on personal social relationships. The key that represents this social relationship is a luxury item and an investable tool.

Inspiration for social applications

Some content in the social field can be invested in.

The economic activities on social or content platforms have always been simple expenditures, such as paying for YouTube Premium, SuperLikes on WhatsApp, OnlyFans, or Tinder. They do not allow users to “invest” or “trade” certain rights or items. However, on Friend.tech, users can invest in social relationships and trade social relationships. This brings a market-based pricing mechanism that can more effectively discover prices.

Social relationships can also have luxury attributes.

Friend.tech’s product has high-quality characteristics at the social level, representing a high status. As the price increases, the attractiveness increases. Users feel that they are not only paying for pure utility but also paying a premium for social attributes. In essence, when users spend money on creators, it is an investment. Such expenditure on Web2 platforms like LianGuaitreon or OnlyFans is only a consumption behavior.

The trust between creators and users can be publicly displayed.

Comparing the Friend.tech experience with Twitter, the most important aspect of this luxury experience becoming financialized is that the social graph can now be priced on the open market. On Twitter, the social graphs of different users are the same. Creators don’t know which users are more enthusiastic than others. However, on Friend.tech, creators can easily see who the earliest (bought early at a low price), the “heaviest” (later bought at a high price), and the most loyal supporters (steadfast holders) are. This brings new trust between issuers and buyers/holders.

The buyer essentially deposits their funds into a highly influenced fund pool, which leads to the convergence of the interests of both parties. The deep level of trust is only manifested when there is an inherent connection of interests between creators and users. Pricing in an open market is even more exciting.

If you are building a social application in Web3, here’s what you can learn from Friend.tech from a product standpoint:

Trust is a scarce resource and is underestimated/nonexistent in Web2 social applications.

Luxury goods can elevate social status, thereby driving the adoption of high-value user groups.

Investment behavior is fundamentally suitable for the Web3 environment, thus necessitating operation in a decentralized and trustless environment.

For better understanding, here are a few examples:

If you are building a Web3 version of Spotify, a good approach to differentiate yourself from other service providers is to offer carefully curated and exclusive music. To achieve the best curation effect, as well as to make the platform more engaging and fun, you may need to incentivize members to help with curation and allow them to earn profits from it, thus optimizing individual and group incentive measures. To identify the best curators, you can track and reward specific behaviors on the platform that demonstrate a breadth and depth of knowledge.

Marine Snow allows members to participate in platform development using their monthly and annual packages, assisting the platform in curating the best music and musicians in the world and owning DCA of the platform itself. Spotify’s music curation used to be a consumption behavior: users spend time listening to music. Now, it is an investment behavior, as users pay monthly for songs and musicians.

If you are building a luxurious version of Bumble (an online dating app), the effect of paying $5 for more matching opportunities may not be ideal. Instead, a better choice is to require users to recharge based on the joint curve of lucky points, where the higher the points, the more matches and higher quality.

For example, Mercurius Club is establishing a new way of socializing with strangers, where every exchange of messages is monetized. Users receive rewards based on the ratio of received/sent messages and invest the rewards into social status projects. Essentially, users are not spending money to connect with other users; it is a consumption behavior. Instead, users invest their time and energy into meaningful conversations. As the conversation deepens, users can better invest their rewards into social status projects, thus gaining more “conversation investment opportunities”.

If you want to create a Web3 advertising platform that requires users to spend time watching an ad and wait for conversion rates, it will never surpass Twitter ads. Instead, giving users a meaningful expected return and having them invest time to watch the ad might be a unique Web3 approach to acquiring customers.

For example, Vessel is a platform that allows users to collect NFTs from any content on the platform brands. This includes minting coins from brand articles or events. Users’ “time-consuming actions” are no longer just spending time reading content, but becoming a “time investment” by investing their time in “collecting” content, and they may subsequently receive rewards in upgraded interactions with the brand. This makes watching ads truly meaningful.

All of these cases turn consumer behavior into investment behavior. This helps build trust through ownership and establish social status through owning luxury goods.

The achievements of Friend.tech have inspired us greatly, and we hope to see more innovative online/chain-based luxury experiences.

Note: Contributors to this article also include friends and key holders of the author on Friend.Tech, as well as Siddharth from Superscrypt, Hongyu from Mercurius Club, Tony from Marine Snow, and Steph from VESSEL.

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