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After declining to participate in Friend.tech due to regulatory issues, DJ 3LAU raises a stir.

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3LAU, known as Justin Blau, has acknowledged the inherent risks, emphasizing his “responsibility” to steer clear of regulatory gray areas. The celebrated DJ and cryptocurrency investor has sparked a frenzy within the crypto community by abruptly parting ways with the decentralized social media platform, Friend.tech. In elucidating his decision, the DJ voiced concerns about the regulatory uncertainties that could potentially plague the platform.

In a Twitter thread dated September 15th, 3LAU divulged his departure from Friend.tech, citing a newfound understanding of the associated risks. He praised the platform as an outstanding product but considered it slightly too precarious for his involvement. In a generous gesture, he pledged to donate approximately 8 ETH to a music-oriented charity dear to his heart, the Paid In Full Foundation.

3LAU’s primary apprehension revolved around the automated market maker (AMM) facilitating the trading of user keys, previously known as shares, on the platform. He contended that such a feature on a social media platform treads in the perilous waters of regulatory ambiguity, potentially leading to complications down the road. He clarified that he didn’t perceive the risks as excessively high, but he recognized his responsibility to abstain from engaging in less transparent regulatory realms. He emphasized his commitment to maintaining his brand’s integrity, steering clear of any associations with AMMs in this context.

This move triggered a significant response on Twitter, with the #3LAU hashtag inundated with a barrage of tweets expressing support and criticism alike. Some accused him of offloading his shares onto his followers or leveraging them as “exit liquidity.” However, 3LAU subsequently announced his intention to reimburse anyone who had purchased his keys.

Friend.tech made its debut in mid-August, offering users the ability to tokenize their social presence by purchasing keys from others or selling their own. Given that these keys carry financial implications, as they involve monetary transactions and fluctuate in value due to various factors, 3LAU’s departure underscores the complexities faced by users disenchanted with this type of social media platform.

In a follow-up post, 3LAU clarified his plan to compensate affected key holders, acknowledging the excessive drama surrounding his initial announcement. He outlined his intention to create a split contract, returning all the ETH to 3LAU Friend.tech key holders pro-rata, based on the block at which he sold the first key. Additionally, he reaffirmed his commitment to donating the full value of all his keys to charity, seeking reconciliation and understanding within the community.

Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Crypto is not a legal tender and is subject to market risks. Readers are advised to seek expert advice and read offer document(s) along with related important literature on the subject carefully before making any kind of investment whatsoever. Crypto market predictions are speculative and any investment made shall be at the sole cost and risk of the readers.