What problems currently exist in airdrop designs?

In the past year, how has community sentiment regarding some popular airdrops changed?

(1) Hyperliquid might be one of the largest and most well-received airdrops in the past six months, considered a typical example among projects without publicly available financing information.

Currently, the market's judgment on whether a project [is worth early interaction] carries a significant weight of financing information.

Because high financing often means endorsement from more professional institutions.

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Earning income through airdrops has become one of the most common user acquisition and community building strategies in Web3.

2) On the other side of public financing, the details of high financing Nillion airdrop were announced, leading to considerable controversy.

The design of airdrops runs through the entire lifecycle of Web3 project development and has become part of the on-chain "financial game."

A series of scaled industries derived from airdrops (scientists, studios, etc.) have also become a double-edged sword in the project construction process.

1. Most projects' airdrop designs can be broadly categorized into two types: retrospective and points-based.

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1.1 Retrospective

(1) There are two types of designs; a significant portion of retrospective projects do not have clear market airdrop expectations.

For example, earlier Uniswap, Arbitrum, and Opensea also announced future airdrop plans to be retrospective.

Retrospective airdrops often yield results that exceed market expectations, and a characteristic of these protocols is that most genuinely address market demand, not relying on airdrop expectations for community growth and cold starts.

For example, Uniswap and Opensea have a very singular business model of charging "bridge fees," but at that time, there was a significant gap in the market, a blue ocean of competition, and user interaction could hardly avoid them.

Up until now, in the fiercely competitive landscape of the DEX sector, unless there are special customer attraction methods like unique wealth codes for the platform or disruptive technological innovations, one cannot rely on the expectation of airdrops.

(1) For example, the chain abstraction DEX @UseUniversalX built on @ParticleNtwrk has interaction logic that differs from over 99% of DEXs in the market (currently there are thousands of DEXs).

(2) Its revolutionary on-chain interaction model has a strong demand in the current Meme trend, especially under the situation of multi-chain market rotation, further highlighting its necessity.

(3) Additionally, UX is built on a "coordination layer" independent of each chain, significantly reducing the chances of native trading tools on other chains crashing due to overheating on one chain.

In this context, users choosing UniversalX are not solely driven by airdrop expectations but are fully motivated by technological innovation, carving out space in a red ocean market.

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1.2 Points System

The points system, or the phased points activities introduced by the project party, if not linked to airdrops and conducted as long-term activities, would purely be a sham (not meant to insult Linea).

The points system must be linked to airdrops; otherwise, it's just a sham.

This points system is a relatively popular airdrop calculation method in this cycle, which not only helps the project team to tally individual contributions but also allows for a more transparent adjustment of points and airdrops during the TGE.

Using a points program, the classic examples are Pi Network, Kaito, and Grass, which are recent classic cases.

Of course, the points system has also been adopted by many projects after the TGE as a "proof of work" for the project's continuous issuance plan.

The deBridge platform I have mentioned several times @deBridgeFinance is a very typical example.

(1) Currently, deBridge is a cross-chain bridging protocol primarily adopted across various chains in the market.

(2) Its growth strategy not only involves innovative cross-chain methods but also long-term incentive plans to cultivate user habits among end-users.

(3) Through long-term points programs, incentivizing users and clients to prioritize adopting deBridge in the competitive red ocean of cross-chain protocols, and distributing future airdrop plans based on points.

(4) Currently, the points season has progressed to the second season, with the last points snapshot taken in July 2024, and the current second season has accumulated 700 million points.

In principle, the more you use deBridge, the more points you earn.

Therefore, the design of points is essentially a form of "proof of work," which can help some protocols with community cold starts and incentivize long-term user retention after the TGE, as well as further seize market share.

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2. What problems currently exist in the airdrop mechanism?

Some projects use studios to inflate data for financing, only to discard them later.

Some projects initially set very strict entry conditions, putting themselves in a difficult position.

This is the positive and negative aspect of the current airdrop game.

However, aside from this, some problems persist.

(1) The promised airdrop ratio was reduced before the TGE.

(2) Lack of transparency in obtaining airdrop qualifications (rat trading).

Since questions can be raised, the solutions to these problems are actually quite simple; the industry just lacks a general consensus to execute.

- To take the first point, the prior commitment from the project team's perspective mainly aims to stimulate market and community sentiment, encouraging users to contribute more data for potential financing activities.

However, this situation also changed with the entry of new investors, as project teams eventually calculated that the ratios could be balanced; in choosing between cutting investor interests and their own, most project teams opted to cut community interests.

"Valuing the community is just a compromise slogan for 90% of projects."

- The second point is more intuitive; regarding the situation of rat trading that I know of, besides the project party dumping their own goods, it is also used as one of the exit strategies promised to investors.

Not to mention some projects listed on top exchanges, especially those with compulsory lock-up rules, can only choose this route for faster exits and capital consolidation.

The image below shows some popular airdrop community sentiments compiled by the Binance Research team based on Twitter's Grok model.

The listed popular airdrop community sentiments from the past year reflect the two issues I mentioned above.

The projects listed in first and second place both adopted retrospective and points-based methods for airdrop distribution, achieving good community feedback.

All of this supports one point.

  • "There is no perfect airdrop design, only projects that value the community."

Finally, this post borrows viewpoints and frameworks from the Binance research team's report to present some of my opinions.