Although you do not need to seal Friendly Plastic to make it waterproof, it is recommended that you seal the surface of the Friendly Plastic to protect the foils from tarnishing or scratching.
Now - I know you're asking "What kind of sealer should I use on Friendly Plastic"? Great question! There are a variety of sealers out on the market today and the good thing is that just about anything will work.
(Update: I've written a more comprehensive post February 2013 - see more information here)
I have sealed Friendly Plastic with Aleene's Decoupage Medium or Mod Podge(R) to provide a protective layer between a stamped image and alcohol ink that I'm about to apply. I've also used Diamond Glaze, Glossy Accents and clear fingernail polish all with good results.
To get the glass like finish that you see on Friendly Plastic, the best sealer is a 2 part resin called Envirotex Light. It can be found at most craft and hobby stores. Locally my Ace Hardware carries it. It takes 24 hours for it to cure, but the finish is beyond compare and it helps to prevent your Friendly Plastic from melting and distorting if it ever comes in contact with heat.
As with using any chemical product, be sure to check the label for any precautions and use in well ventilated areas if directed to do so.
Linda Peterson is compensated and endorsed by AMACO. The guests features may or may not have any affiliation with AMACO.