Coinbase & Friendtech: A Warning for Retail Investors

The recent activities surrounding Coinbase and the launch of a viral social dapp, Friendtech, have raised concerns over transparency and fairness. Here’s the story that is now unfolding and what it means for the everyday investor.

Coinbase and The Co-Founder’s Smart Trade

Coinbase insiders, including the co-founder who also founded Paradigm, reportedly dumped hundreds of millions of dollars worth of $COIN, with some of it near the top, over $250 per share. This same co-founder then bought back near the all-time low. It’s a smart trade, but what does it mean for retail investors?

Friendtech’s Buggy Launch and Paradigm’s Involvement

Five days after the sell-off, Coinbase announced the launch of “the first viral social app on Base.” It was a move that drove massive traffic to its new Base protocol. Two days later, Paradigm revealed its involvement as backers of the app, boosting activity and seemingly legitimizing the platform.

Friendtech, under the guise of being a private chat for influencers, has its issues: buggy, and intriguing, but set up in a way that could ultimately spell disaster for retail.

Influencers and Manipulations: The Profit Game

Influencers on Friendtech are profiting by manipulating individual share prices, buying their tokens and burning them into the bonding curve. Some have made over six figures in just a few days, while the platform rakes in millions from its 10% fee on every transaction.

Friendtech’s share prices are volatile, rising and falling rapidly. Influencers, Paradigm, and Coinbase stand to profit, but what happens to retail? It’s an unsustainable Ponzi scheme. Some retail traders may win if they’re early, but most will be left holding the bag.

Bots and Front Running

The situation is further complicated by bots and front-running, where retail is even further disadvantaged, being front-run by bots while the sellers of these bots front-run their own customers. Coinbase, Paradigm, influencers—they all stand to win, but retail loses. It’s not an indictment of these players, as much as a warning to the average investor. This time is not different, and the end may be ugly for those unaware of what they’re getting into.

The tale of Coinbase, Friendtech, and the hidden intricacies of a well-played game serves as a stark illustration of an age-old truth in investing: If you’re not cautious, you might just become the exit liquidity.

This is not about slamming Coinbase or its insiders. It’s a heads-up to you, the hardworking people trying to make a buck and maybe get ahead. Know the game, and know the players. Remember, in the world of cryptocurrencies, if you’re not at the table, you might just be on the menu.