- Machi Big Brother has lost $16 million in Friend.Tech (FRIEND) investment.
- The influencer spent 5,200 ETH to acquire 11.1 million FRIEND tokens.
- Friend.Tech’s decision to abandon smart contract control led to a significant token plunge.
- FRIEND token experienced an 80% decline on the weekly chart.
- Critics liken the situation to a rug pull due to venture capitalist backing.
The news often likes to “shill” altcoin success stories, but recent events highlight the “darker side” of high-risk cryptocurrency investments – or should I say gambling.
Pseudonymous cryptocurrency influencer Machi Big Brother has recently faced substantial financial losses following a significant investment in the SocialFi project, Friend.Tech (FRIEND).
According to analysis by Lookonchain, shared via an X post on September 9, the influencer has incurred losses amounting to $16 million.
The Investment
Machi Big Brother’s initial investment details remain undisclosed, but it is known that he invested approximately 5,200 ETH, equivalent to $16.7 million, to acquire 11.1 million FRIEND tokens.
Finbold reports that this is not the first instance of losses for the influencer in this token. Back in June, after starting his purchases in early May, Machi Big Brother had already faced losses of $7.9 million, having spent $15.6 million by June 8.
REALTED: Friend.Tech Faces Security Crisis: Recent SIM-Swap Attacks Raise Concerns
Friend.Tech’s Downfall
The FRIEND token’s sharp decline can be largely attributed to a series of controversial decisions made by the Friend.Tech team.
The most significant of these decisions was the transfer of the management’s smart contracts’ control to the Ethereum (ETH) null address. This action, taken on September 8, effectively marked the cessation of the platform’s operations within a year of its launch.
“The team chose to abandon its smart contract control, leading to a major loss in functionality, including bug fixes and feature improvements,” one analyst noted.
Launched to enable users to buy and sell shares of social media profiles, the platform’s abrupt halt in operations has severely impacted the token’s value.
As of the latest reports, $FRIEND was trading at a mere $0.0619, a 52% drop within a day and an alarming 80% decrease on the weekly chart.
RELATED: Another Friend.tech User Loses $34,958 in Phishing Scam, Raises Alarm on Cryptocurrency Security
Market Reactions
The losses incurred by Machi Big Brother underscore the extreme volatility present in the cryptocurrency market. They also highlight the importance of conducting thorough research before making investments.
In this case, the centralized decision-making approach of Friend.Tech appears to be a significant factor contributing to its downfall. The lack of a community-driven narrative and oversight has left many investors feeling abandoned and disenchanted.
Some market commentators have suggested that the situation might be akin to a “rug pull,” especially considering that the project was backed by venture capitalists. This term is used to describe a scam in the cryptocurrency world where developers abandon a project and run away with investors’ funds.
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Broader Implications
The Friend.Tech debacle also reflects broader issues within the Ethereum ecosystem. Critics argue that venture capitalists (VCs) have exploited Layer 2 (L2) and restaking applications through inflated valuations and questionable airdrop practices. This has resulted in a community that increasingly feels disconnected and unenthusiastic.
Critics point out that this is not just an Ethereum-specific issue. VCs and influencer groups have become pervasive in almost every major decentralized application (dApp) launch across various blockchain platforms.
The crypto world never ceases to amaze, and the latest twist in the saga of our high-stakes gambler, Machi Big Brother, is no exception.
After burning through $16 million in a failed bet on Friend.Tech, he’s now pivoting to launch his own DeFi memecoin, aptly named $MACHI.
With a post on September 7th on his X account proclaiming, “When $MACHI launches it will be the most advanced cutting edge DeFi memecoin. Make DeFi great again,” it seems that he is trying to recoup his losses with a fresh roll of the dice.
Whether this new venture will soar or flop remains to be seen, but one thing is certain: Machi Big Brother is nothing if not persistent.
The losses experienced by Machi Big Brother serve as a cautionary tale for cryptocurrency investors. While the allure of high returns is ever-present, the risks are equally significant.
The Friend.Tech case demonstrates the potential pitfalls of centralized decision-making and the dangers posed by the influence of VCs in the blockchain space.
Investors and enthusiasts alike are reminded of their own roles in these scenarios, having “aped” into various tokens without sufficient due diligence.
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