NewsFlash Articles Data Fundraising BlockBeats Pro

How does ARB inspire future project teams to conduct airdrops?

Read this article in 12 Minutes

Targeted token distribution strategy design.

Original Title: "How does ARB inspire future project airdrops?"

Source: Odaily Star Daily

The launch of ARB is an important moment for the cryptocurrency and Ethereum industry, as well as a huge milestone for the airdrop community. How will the project team incentivize early adopters with tokens after ARB? Today, let's delve into the future of airdrops.

How did airdrops evolve?

Airdrops remain the preferred mode of rewarding the community and decentralizing protocol ownership. However, Uniswap-style retroactive airdrops are a thing of the past. A simple transaction or LP position will no longer qualify you for an airdrop. Even the most basic airdrop methods now consider grading criteria and anti-whale attack mechanisms.

Although Arbitrum is undoubtedly the hottest airdrop of 2023 (so far), there are still shortcomings in its airdrop method from the perspective of technical performance and token distribution. In this article, we will analyze some pitfalls of the ARB airdrop and explore how other star protocols have iterated on past airdrops while coordinating with the community, attracting liquidity, and minimizing network disruption.

ARB Airdrop Analysis

On March 23rd, over 1.16 billion ARB tokens were airdropped to 625,000 independent active wallets, with distribution amounts ranging from 625 to 10,250 tokens per address. Most of the claiming activities were done in advance, with 52% of the distribution being claimed within the first four hours. On the day of ARB's release, Arbitrum saw a high level of on-chain activity, setting a historical record of 612,000 active addresses and 2.7 million transactions, which is 145% and 32% higher than Ethereum, respectively.

ARB 如何启示未来的项目方空投？ Sorry, I am unable to translate the given content as it does not contain any Chinese characters. Please provide me with the Chinese content that needs to be translated.

A large amount of traffic caused the Arbitrum sequencer to crash, resulting in RPC endpoint failures between public providers. Although Arbitrum's technology is currently at the forefront of the industry, providing higher throughput and call data compression through Nitro, the limitations of blockchain technology began to be exposed in the hours following the ARB airdrop.

Arbitrum's Web2 infrastructure also couldn't handle the load. Within hours of the release of ARB, the recommended claiming portal website, arbitrum.foundation, and the blockchain explorer, Arbiscan, both went down. Arbitrum users and airdrop claimants immediately expressed their dissatisfaction on Twitter.

空投的迭代

translates to

Airdrop Iteration

in English.

In 2022, the retrospective airdrops that were popularized are no longer keeping up with the industry's development speed, as well as the simple airdrop standards. The hottest protocols today recognize the potential of airdrops and are designing innovative distribution strategies to maximize their potential, rewarding users who have already interacted with the protocol or product.

Undeniably, airdrops are the biggest "cost" generated by many protocols. So how do they achieve maximum value?

任何空投的主要目标都应该是公平地奖励各种链上活动，致力于将代币分发给那些最不可能出售和最有可能参与治理的用户。有针对性的分发标准是实现这一追求的关键。

除了基本用途之外，协议已经开始越来越多地奖励多种类型的链上交互。

Translation:

In addition to its basic functions, the protocol has begun to increasingly reward various types of on-chain interactions.

Optimism has chosen to allocate the OP token to DAO voters, multisig signers, and Gitcoin L1 donors, ensuring that token holders are aligned with the direction of public product financing on the chain from day one.

Sudoswap specifically distributed SUDO to holders of "0x mon" NFTs designed for project teams, providing additional rewards for those who have already made economic commitments to the Sudoswap ecosystem.

Although Arbitrum provides DAOs with tokens that can be self-managed, its rollup missed the opportunity to directly reward good citizen behavior in the ecosystem, seemingly overlooking NFT holders who participated in the Odyssey event. While airdrops are not intended to completely replace industry standards of transactional value and token usage, additional methods can be used to incentivize desirable user behavior. For example, Arbitrum can include governance participation as a criterion for receiving airdrops.

Despite the collaboration with Nansen to combat witch attacks, there are obvious loopholes in Arbitrum's witch attack detection. An analysis conducted by X-explore found that the ARB airdrop included approximately 4,000 witch attack communities, controlling addresses eligible to claim 253 million tokens, which accounts for 21% of ARB user allocation. Three well-known witch attack communities claimed to have claimed over 4.2 million ARB tokens.

Anti-witch mechanism" is not a perfect solution, but lowering the standards and rewarding various behaviors with good on-chain user behavior characteristics can help limit the number of tokens distributed to "witch" attackers and farmers. Setting additional standards helps manage airdrop distribution and provides tokens to addresses that contribute to the ecosystem.

Improvements to Airdrops

Pull-style airdrop requires token recipients to claim the airdrop, which seems attractive to many projects. It avoids gas fees and provides an opportunity for protocols to promote governance by discouraging "sell-on-sight" holders, as in the case of Arbitrum's claiming process. However, considering the current limitations of blockchain technology, a network-wide pull-style airdrop may cause chaos on the chain, hinder the chain's ability to process transactions, and create a complex token claiming experience.

Optimism's second airdrop was distributed through a push method, smoothly allocating 55 million OP tokens to over 33,000 independent active addresses without causing a wider network interruption. While a pull-based airdrop may be feasible for protocols attempting to encourage governance participation in large initial airdrops, a push method is preferable for repeated airdrops to networks with a large number of wallets.

Which encryption application doesn't like to attract more TVL? Airdrops provide a convenient way to do this. NFT market Blur has innovated in tracing the airdrop model and chooses to actively announce the eligibility criteria for airdrops to attract users.

Since its launch, Blur has publicly announced its intention to airdrop tokens to various user categories, and most of the initial adoption in the NFT market came from users trying to maximize their eligibility for the airdrop. Currently, Blur handles 72% of weekly NFT trading volume, partly due to the pre-announcement of its second season airdrop.

Source: Dune Analytics

Despite the success of Blur's strategy, Arbitrum still insists on distributing tokens based solely on users' past participation, missing the opportunity to attract more users and TVL to the chain. As the incentive measures ultimately dry up, Blur's dominant position in the NFT trading field may gradually disappear, but the pre-announced airdrop helped Blur "stand firm" in competition with giants such as OpenSea.

Airdrop is a marketing expense that is directly targeted at consumers through retrospective distribution. Although the distribution of these tokens does not need to be large, granting tokens to users of competitive protocols can strengthen the relationship between the project party and users, and provide opportunities to capture new liquidity and users. Optimism and Sturdy Finance are both protocols that use this method, and each protocol allocates some tokens to users of competitive protocols.

Summary

The best airdrop practices are not set in stone. Protocols are constantly updating their token distribution methods, attempting to optimize user eligibility for airdrops, attract liquidity, and create a "smooth" user experience.

The encryption industry is constantly changing, but it is clear that the latest airdrop from Arbitrum is not the final form of airdrops. Other projects are further innovating the way airdrops are conducted, but the launch of Arbitrum tokens is an important inspiration for the industry.