Friend Tech Grapples with Sniper Bot Issue, Influencing Share Prices
Friend Tech (FT), the web3 social token platform, has recently faced a resurgence in user activity. However, the platform has also encountered a growing problem in the form of "sniper bots" that are causing significant fluctuations in share prices, raising concerns about the fairness of the platform.
A detailed analysis conducted by @unexployed_ of Castle Capital shed light on these sniper bots. These bots, beyond their typical functionality, employ a technique known as 'sniping' to gain control over high-value profile shares. An example of this behavior occurred when DappRadar registered on FT, and share prices skyrocketed to an unusually high point of 0.26 ETH. This surge wasn't initiated by a registered account but appeared to result from a sniping address directly interacting with the platform's smart contracts, demonstrating the influence of these bots on market dynamics.
Further investigation on basescan.org allowed @unexployed_ to trace the chronological order of buyers and sellers. Within the first four blocks, 65 shares were already on the market, and DappRadar was not the only entity affected. Other profiles like Moonshilla and Rektdiomedes experienced similar situations, where snipers quickly gained control over their FT supply.
The primary sniper, identified as 0x081…951, executed over 20,000 transactions to acquire these shares. Initially, the first 46 transactions failed due to the error "Insufficient payment" and were subsequently reverted, as reported by Basescan. A CryptoSlate analysis revealed that this account attempted to purchase shares before the account owner had bought the first share, a requirement set by FT. The transaction log indicated the error, "Only the shares' subject can buy the first share."
This spamming behavior had already emerged during FT's initial week, with spamming the chain and mempool leaks being contributing factors, according to Bert Miller from Flashbots. The sniper's extensive control over the supply allowed them to profit 1.84 ETH by selling their acquired shares. However, this activity led to a significant reduction in supply, resulting in another sniper incurring a loss of 0.5 ETH, highlighting the competitive nature of these bots.
As revelations about these sniper bots surface, concerns are mounting regarding the platform's fairness, particularly for individual users and high-value profiles. @unexployed_ suggests that FT should explore potential solutions, such as allowing creators to purchase more of their shares upon registration, to mitigate the bots' impact.
Despite the challenges posed by sniper bots, FT has shown significant progress and a resurgence in user activity. The platform's revenue surged to $5.6 million on September 9th, marking a 30-day high for the blockchain-based social network. This revenue boost was driven by consistent growth in usage over the past two weeks, despite the initial hype waning after its launch.
FT achieved a daily active user count of 9,000, with 2,000 new sign-ups recorded on September 9th. On the same day, the platform witnessed a trading volume of $12.3 million, making it the third-highest trading day since its inception. Additionally, FT collected fees amounting to $1.23 million, solidifying its position as one of the highest fee-generating dApps in the crypto market.
However, the rise in sniper bots continues to impact share prices, with the full extent of this influence yet to be determined. FT initially made waves with its beta version on Coinbase's layer-2 Base in August, but it now faces the challenge of addressing the growing presence of bots on its platform. How FT responds to this bot activity remains to be seen.