Welcome to Paul’s unique discussion, today I want to talk to you about why I support witch hunts.

1. What is an airdrop?

Airdrop, in English, means 'falling from the sky.' In practical terms, it refers to the rewards given to users by the project party for various purposes (mostly marketing strategies). The behavior model is to directly distribute tokens to suitable user accounts or allow eligible users to claim tokens themselves.

The earliest airdrops can be traced back to the early days of Bitcoin, when anyone could receive an airdrop by spreading the word about or introducing Bitcoin on social media. Nowadays, although a few project parties still reward participants in similar ways, more project parties set more conditions to filter users. The more mainstream method is for users to prove their potential value through staking, interaction, etc., to subsequently receive airdrops from the project party.

2. So why issue airdrops?

Airdrops may seem like a windfall for users, while project parties do not incur too many actual costs, which is clearly a profit-sharing behavior. The logic behind this is not hard to understand: distributing tokens for free for promotion releases very positive signals for public reputation and subsequent token usage. This is a long-term benefit for ecosystems or projects.

In the blockchain world, 'airdrop' was originally a way for project parties to express sincerity. It rewards early users or attracts new users by distributing tokens, usually without additional conditions, low cost, and high efficiency, quickly becoming a golden strategy in 'cold starts'.

3. UNI kicked off the year of airdrops


📅 Time: September 2020

Uniswap airdropped 400 UNI tokens to all wallets that had made at least one transaction on the platform.

  • 💰 At that time worth about $1,200, later reaching a maximum value of over $15,000.

  • 🏆 Considered the first airdrop that combines 'governance rights + financial incentives'

This airdrop established the paradigm of 'rewarding users with tokens' for subsequent DeFi projects, encouraging thousands of users to start trying on-chain operations. However, it is also from here that 'airdrop farming' became an industry chain, and 'Sybil attacks' gradually emerged.


4. Sybil Attack

In the cryptocurrency field, 'Sybil Attack' originally means one person disguising as multiple identities to participate in a decentralized system for the purpose of gaining rewards.

In airdrops, 'Sybil Attack' typically refers to:

🧙‍♀️ A person creates a large number of addresses to simulate real user behavior in order to cheat multiple airdrop shares.

Through the witch method, many studios have sprung up like mushrooms after rain, further plundering rewards that should belong to the project party for real users. In order to attract more genuine users, project parties have also begun to combat witches.

5. Anti-witch technology upgrades

Now more attempts are being made with Gitcoin Passport (combining off-chain verification and social accounts), Soulbound Token (SBT) (non-transferable identity), and zkProof human proof (zero-knowledge proof that you are 'one person') to conduct witch hunts.

6. So why do I support witch hunts?

I am not against using multiple accounts for airdrops, but I oppose unfair cheating. Witch hunts are to protect us genuine participants who interact seriously.

I have a few thoughts:

  1. Earlier we mentioned that airdrops are meant to reward real participating users. If you only have one account, interact seriously, try to experience the project, and provide feedback on bugs, then you deserve to be rewarded. However, witch accounts use automated scripts to perform low-quality interactions. If witches are not checked, and products have bugs with no feedback, that would be the biggest risk for the project party.

  2. Generally, when setting the project's economic model, the proportion of the community is considered. Therefore, airdrops are like dividing a cake; the cake is only so big. For example, in some projects, witches directly take 30%-50% of the rewards, which means that the cake available for genuine users becomes relatively smaller.

  3. If it is acceptable that witches have taken the cake, the situation becomes worse when witches sell their airdrops immediately after receiving them, not participating in the ecosystem or governance. This further reduces the cake's benefits for retail investors, while project parties intended to use airdrops to launch projects and get more people involved, only to face sell-offs. Therefore, project parties checking for witches is also a responsibility to themselves and retail investors.

  4. Currently, many projects have also opened appeals because, during the investigation, it is inevitable to mistakenly harm some real users. Therefore, project parties also provide appeal channels and secondary verification to better protect users.