Crypto Platform Faces Rug Pull Claims After Smart Contract Control Is Lost

Friend.tech, a Web3 social media platform, is under scrutiny following allegations of a rug pull.

The controversy erupted after the platform’s team relinquished control of the project’s smart contracts on September 8, setting the admin parameters to Ethereum’s null address to prevent future alterations to fees or functions. This move led to a 26% drop in the value of the Friend.tech (FRIEND) token within 24 hours.

Crypto analyst Waleswoosh criticized Friend.tech on X, accusing it of being a “Ponzi scheme” that shifted from a social finance app to complex trading.

The analyst claimed that during its peak, the platform’s creators made grand promises to key holders, and the team collected over $60 million in fees.

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According to Lookonchain, the team sold 19,477 ETH, approximately $52 million, between December 2023 and June 2024, and the token’s value has plummeted by 95% since launch.

Despite these issues, Friend.tech’s team announced on September 10 that they will continue operating the app and clarified that their recent changes only prevent future fee adjustments on the Base layer-2 platform, not affecting the app’s current functionality.

Alexander Stefanov

With over 8 years of experience in the cryptocurrency and blockchain industry, Alexander is a seasoned content creator and market analyst dedicated to making digital assets more accessible and understandable. He specializes in breaking down complex crypto trends, analyzing market movements, and producing insightful content aimed at educating both newcomers and seasoned investors. Alexander has built a reputation for delivering timely and accurate analysis, while keeping a close eye on regulatory developments, emerging technologies, and macroeconomic trends that shape the future of digital finance. His work is rooted in a passion for innovation and a firm belief that widespread education is key to accelerating global crypto adoption.