Airdrop Feast: The market always favors explorers

On April 22, the algorithmic stablecoin project Ampleforth announced the issuance of the governance token FORTH and an airdrop. Any address that has interacted with the AMPL smart contract can apply for the FORTH token airdrop. More than 75,000 addresses are eligible to receive it. Based on today's price, each address can receive an average of approximately US$5,000 in airdrops.

At the same time, various stories of getting rich spread in major crypto communities. Some users received airdrops worth tens of thousands of dollars with only 0.001 AMPL left in their wallets, and some users received airdrops worth tens of thousands of dollars because they had recharged AMPL to exchange addresses. All early users of AMPL received generous financial returns.

Previously, early users of projects such as Uniswap and 1inch had received generous airdrops from the projects. Now, under the leadership of these representative projects, more and more DeFi projects have begun to airdrop to early users. So far, at least hundreds of projects have airdropped tokens to users in different forms, allowing early users to share in the growth dividends without investing. This is a true practice of the open and shared spirit of blockchain.

01Airdrop Feast

Judging from the actual situation in the crypto industry, airdrops of various projects can be divided into two types in a broad and narrow sense, and point to different airdrop purposes.

In a narrow sense, airdrops can refer to crypto projects directly issuing tokens to users with a history of on-chain interactions. The value of airdrops has no direct relationship with the continuity of interactive behavior or the value of assets. Users’ expenditure costs are relatively fixed and market risks are relatively limited. The purpose of this type of airdrop is mainly to reward early users.

In a broad sense, airdrops can refer to crypto projects directly issuing tokens to users who meet specific conditions, and users can obtain them without paying any money. These may include conditions with high capital costs and price risks (such as token decline risks and impermanent losses), such as providing liquidity and holding other tokens, as well as extremely low-cost but relatively cumbersome conditions such as completing social media tasks.

The purpose of this type of airdrop includes incentivizing specific user behaviors, increasing token liquidity, improving marketing effectiveness, etc., which is also the method and purpose adopted by most projects.

Considering the purity of the purpose of airdrops, the following analysis in this article mainly refers to airdrops in a narrow sense, which are obviously more sincere and symbolic.

In order to gain a deeper understanding of the history of airdrops in the crypto industry, Chain Catcher has compiled relatively well-known airdrop projects and their specific airdrop data since September 2020, and the table is as follows:

Note: Price statistics are as of 16:00 on April 27

In addition to the above statistical projects, many projects such as Tokenlon, OpenOcean, Sifchain, Deversifi, Opium, Force DAO, ShardingDAO, Chainswap, Smoothy Finance, etc. have announced token airdrops to early users. Due to the length limit of the table, they are no longer listed in full.

According to Chain Catcher statistics, since September last year, at least 30 DeFi projects have airdropped tokens to their early users. Based on the average number of airdropped tokens (some are the minimum number of airdrops) and today's prices, if a heavy DeFi user conducts an interactive test in the early stages of these projects and keeps these airdropped tokens until now, he can get at least $160,000 in returns, and the interaction cost will not exceed $1,000 at most.

Calculated based on the number of airdropped tokens as a percentage of the total issuance, projects such as Ampleforth, Uniswap, Badger DAO, PoolTogether, and Secretswap ranked in the top 5, all above 10%. Among them, the algorithmic stablecoin project Ampleforth has an airdrop ratio of more than 67%, making it the most generous project in the history of DeFi airdrops.

According to the number of airdrop addresses, Uniswap, Ampleforth, 1inch, Badger DAO, Secretswap and other projects ranked in the top 5 respectively. Among them, the number of airdrop addresses of Uniswap almost exceeded the total of all other projects, which shows the influence of Uniswap among the crypto user group.

Calculated by the average airdrop value, Inverse Finance, Uniswap, Reflexer, 1INCH, Tornado.Cash, EPNS, Ampleforth and other projects ranked in the top 7, and the airdrop value was all above US$5,000. The stablecoin yield protocol Inverse Finance ranked first with an airdrop value of US$55,000, but the number of its airdrop addresses is estimated to be no more than three digits.

Judging from the time of airdrops, the number of airdrop projects has increased significantly since January this year. More than half of the airdrops within the statistical scope have occurred in the past two months, reflecting that airdrops as a form of user feedback have been recognized by more and more project parties.

02The market always favors explorers

In the Internet industry, this phenomenon is unimaginable. Companies such as Facebook, Alibaba, and Tencent have reaped huge revenues and profits from traffic dividends and have become Internet giants with global influence, but their early users were just spectators in the process and did not gain any actual benefits from it.

Zhihu set a precedent among a number of domestic Internet companies this year. After its listing in the United States in March, it gave equity rights equivalent to 100 American depositary shares to early V users who reached a certain level. However, the value was only a few hundred US dollars, which was negligible compared to the market value of billions of dollars.

The crypto market is a completely different picture. Many mainstream DeFI projects are competing to "send money" to early users, ranging from hundreds of dollars to tens of thousands of dollars. Today, most DeFi users have had the experience of receiving airdrops.

The truth reflected by these airdrops is that the market will always favor those explorers who dare to try, are curious and have a strong desire for knowledge, especially in the DeFi market. If you have participated in the governance voting of DeFi projects such as Yearn Finance and Aave, if you have donated $20 to several early high-quality projects through Gitcoin, and if you have used several mainstream on-chain DEXs in the first half of last year, you can still get airdrops worth tens of thousands of dollars.

For early projects, every interaction of users is equivalent to product testing, which can help the project party optimize its code logic, while improving its product data performance and gaining more attention. For these early seed users who help the project grow, the project party should give certain rewards and further improve the stickiness of seed users.

This is also the true embodiment of blockchain technology and its spirit. Every user can become a sharer of product dividends and a governance participant. Users and development teams become a unified interest group through tokens and jointly promote product optimization and market expansion.

Of course, the huge wealth effect also brings more and more speculators, who will try to register multiple addresses to interact with the project smart contracts to get more airdrop opportunities. A typical case is the ninth round of Gitcoin donations in March this year. Since the donation threshold is only a few dollars, many users registered accounts in batches to donate to the project in the hope of obtaining airdrops from certain projects in the future.

For this reason, Ethereum founder Vitalik wrote a special article about this matter, believing that airdrop-driven donations have subverted the ideals of Gitcoin and is considering launching a Gitcoin donation plan that does not support airdrop traceability. In addition, many projects now have requirements for the number of user interactions and the value of interaction. In the future, the airdrop threshold of DeFi projects may be further increased to further screen out early users who truly contribute to the project.

It can be said that the airdrop feast in the crypto market is still in its early stages, more and more high-quality DeFi projects are emerging, and the market penetration of DeFi products is still accelerating. This is the golden age of the DeFi industry and the golden age of every DeFi explorer.

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