• 19 June, 2024
Market News

Friend.tech Elevates Security with Complete Transition to Multisig Treasury

Friend.tech, the decentralized social application operating on Coinbase’s Base blockchain, has made notable shifts in its treasury management and security measures, reflecting broader trends in blockchain and cryptocurrency management. Analyst Tom Wan recently highlighted that in December, the platform moved all earned fees from an externally owned account (EOA) address to a multi-signature (multisig) address. Additionally, it transferred half of its earned revenue, amounting to 7,800 ETH (approximately $16.6 million), to Coinbase.

The move to a multisig address is a significant step in enhancing the security and governance of Friend.tech‘s funds. Multisig addresses require multiple signatures to execute transactions, thus reducing the risk of unauthorized withdrawals. This shift also followed an unsettling event in October when Friend.tech users became victims of SIM-swapping attacks, resulting in a theft of about $400,000 within a day. Furthermore, in November, another sophisticated phishing attack targeted Friend.tech users, emphasizing the growing need for robust security measures.

The platform’s total value locked (TVL) has witnessed fluctuations, currently standing at approximately 15,000 ETH ($33 million), down 50% from its peak. This decrease in TVL coincides with a downturn in daily key-minting activities and a significant drop in active user engagement on the platform.

To respond to these challenges and to bolster security, Friend.tech transitioned the ownership of its smart contract and funds to a combination of multisig and professional custody. The platform articulated that these changes are instrumental in enhancing long-term security and meeting tax obligations.

Despite these adjustments, the broader SocialFi app market, of which Friend.tech is a part, has experienced mixed fortunes. While some apps like New Bitcoin City have seen growth and net inflows, others, including Friend.tech, have faced downward trends. Notably, Friend.tech’s most valuable creator, known as ‘Vombatus,’ significantly impacted the platform’s dynamics by selling 176 of their keys, leading to a substantial decrease in their key price and triggered notable outflows from the platform.

Polygon's MATIC Poised for a Surge: Charts Signal Optimism Read Previous

Polygon's MATIC Poised for a Surge: Charts Signal Optimism

Chainlink Gains Momentum: Integrations and Market Movements Signal Growth Read Next

Chainlink Gains Momentum: Integrations and Market Movements Signal Growth