Over the weekend, the total trading volume on Friend.tech exceeded $10 million, the highest for several weeks.
However, industry analyst Colin Wu said, “This may be exit behavior.”
Ethereum is being withdrawn from the platform as keys are being redeemed at a faster rate than they are being minted, according to Dune Analytics.
More than 5,000 ETH was withdrawn from the platform in the two days over the weekend. It is the largest withdrawal since October 24, when 4,380 ETH was taken off in a single day.
Moreover, Friend.tech total value locked fell 21% over the weekend to 17,100 ETH, or $33.6 million.
It is the lowest TVL on the SocialFi platform since mid-September.
Since its peak of around $50 million in early October, Friend.tech TVL has tanked by around 34%.
Additionally, there has been virtually no increase in the number of new users since late October. According to Dune, the platform has a total cumulative user figure of 839,190, but activity has fallen back overall.
Moreover, the platform has been plagued with scams as malicious actors target its users through phishing and SIM-swap attacks.
Over the weekend, the team reported that they had identified and removed 600,000 accounts identified as bots. However, it appears that genuine users have also been locked out.
Prominent crypto influencers are now reporting being locked out of the platform. One said they lost more than 10 ETH, which the platform will not help them recover. “These social finance apps are all incompetent, and I regret joining them,” said “SalsaTekila.”
Meanwhile, analyst Alex Krüger said the Friend.tech team “locked me out with an upgrade, then refused to help,” adding:
“These people are absolute scum. Founders have a fiduciary duty towards holders who put their money in.”
It appears that the Friend.tech hype could be waning as users become disgruntled with the platform and start withdrawing their assets (if they can).