It is said that 2024 is the year of airdrops, and two months have passed. We have indeed witnessed many projects taking this step. However, the "pow-style airdrops" are becoming less and less, thanks to TIA's promotion of "stake to earn". The days of struggling with interaction seem to be getting further away. In addition, this method has allowed many projects to handle the selling pressure after the token airdrop and stabilize the price at a level recognized by the market after listing.

It used to be a common practice to dump airdropped tokens after they were listed, but now people consider the possibility of both eating and holding the airdropped tokens. With more and more projects offering airdrops as a marketing strategy for staking, this seems to have become a new trend.

Starting with TIA, the "airdrop Lego"

This change in mindset seems to start with TIA.

On October 31, 2023, Celestia, a modular blockchain built using Cosmos SDK, went live on its mainnet, and its native token TIA was also listed on major CEXs. At that time, most people in the community were not yet aware of the power of the word "modular", including those who received TIA airdrops. As a result, most people sold their airdropped tokens after TIA began trading, and as of early November, the price of TIA remained stable in the $2 range.

Later, the price of TIA rose from $2 to $8 and then to $12, with each quote from the cryptocurrency media being a new historical high. The community became restless and began to wonder what kind of magic a purely technical project like this had to keep the coin price from falling back after the airdrop was launched. As a result, the "stake to earn" model returned to the spotlight.

Since December last year, "pledging TIA has become the best profit strategy for the new bull market" has been widely accepted by more and more people. What really made TIA stand out and discover its great value were the airdrop rules of the modular settlement layer project Dymension and the Cosmos ecological scalability protocol Saga. By pledging one TIA before the snapshot, you can get the DYM airdrop, while pledging 23 TIA can get the Saga airdrop.

From then on, the price of TIA was unstoppable, and a new round of "never-ending rise" was initiated.

It is no longer important whether the technological value behind Celestia, the first modular blockchain, is recognized by the community. Staking TIA and receiving airdrops from other projects has become a legitimate reason for everyone to acknowledge TIA. "The price of TIA is not important, because receiving airdrops from other projects can make up for it," which has created a (3,3) model for the staking mechanism. Everyone stakes, everyone profits.

Profit models under the pledge, holding, and selling modes of the prisoner's dilemma theory deconstruction; image source network

The previously mentioned DYM airdrop had already reached a price of 4 US dollars and a market capitalization of 4 billion FDV before the market opened. After being listed, the price stabilized at 5 US dollars and did not experience significant airdrop selling pressure. The reason behind this is still pledging. Many people in the community have the mentality of "prepare to not sell, buy more as it falls, and make up for TIA's losses from DYM". With the launch of the Dymension pledging website, popular projects with airdrop expectations such as Wormhole and Avail are rumored to be giving airdrops to DYM pledgers, and the price of DYM has risen to a high of 8.7 US dollars.

It has to be said that the TIA and DYM's staking mechanism has inspired many projects with new ideas. Through "stake to earn", users' airdrop expectations make them less sensitive to token prices, which forms a delicate balance with the project's lock-up purpose, and is a win-win situation to some extent. Compared to encouraging users to participate in ecological construction by offering activities before the airdrop is launched, this operation with greater imagination space can better stimulate users' expectation management and autonomy.

Empowering Pledges, A Good Show of Marketing?

Except for TIA and DYM, the oracle projects Pyth Network and the Ethereum sidechain Ronin have also attracted a large number of participants due to staking rewards. In order to sustain this Lego-style airdrop gameplay, there needs to be enough new projects forming network effects to give users sufficient psychological expectations. Therefore, many new projects have also realized that they can use this psychology in reverse to bring exposure to their projects, achieving a win-win situation for all parties involved.

For example, do you know what Nabla Finance, Synonym Finance, and Scallop are for? These three projects are respectively an automated market maker, a cross-chain lending protocol, and a lending protocol for the Sui ecosystem. If you are not a cryptocurrency enthusiast, you probably won't pay special attention to these Dapps. However, if you are a PYTH staker, these projects will naturally appear in your timeline because they have all integrated Pyth's oracle service, which will provide PYTH stakers with certain incentives or airdrops.

Returning to the modular ecology, we can also find that many new projects will interact with the community, either openly or secretly, before launching their test network or point tasks, claiming that they will airdrop tokens to those who stake xx tokens. This will attract a wave of stakers who have already passively locked their tokens, as well as a group of potential users who are skeptical about whether staking can really bring more airdrops. This kind of staking empowerment is a very elegant marketing technique.

It can be observed that the tokens that can be used for pledging are all infrastructure projects or underlying ecological projects. Celestia is a modular DA layer, Dymension is a modular settlement layer, Pyth is an oracle, and Ronin is a test chain that undertakes the game ecology. Even Ethereum can be seen as a modular blockchain in a broad sense. It seems natural to receive airdrops of new projects within the ecology by pledging tokens of these projects.

But is this approach sustainable? From the perspective of ordinary users, staking tokens is only for the purpose of receiving expected airdrops. If this expectation is not met, perhaps the selling pressure will only be delayed and not disappear. For basic protocol layer token projects, users' expectation gaps can also have a certain impact on network stability. The Dapp project that gives airdrops to these stakers also needs to carefully consider the incentive settings for staking levels and the sustainability of the project's popularity after the airdrop distribution.

For ordinary users, there is also a risk that cannot be ignored, which is the lock-up period of the pledged tokens. Generally, it is 21 days, and some projects have specific requirements. For example, Dymension requires waiting for 3 weeks after canceling the pledge before selling the tokens. If there are extreme market conditions or token unlocking events, ordinary users may not be able to withdraw liquidity in time, resulting in asset losses.

Speaking of airdrops, Pixels, a game on the Ronin ecosystem, launched its token yesterday, and users who staked RON were happy to receive rewards. Earlier, Layer3 Xai, a game on the Arbitrum ecosystem, hinted at launching a staking mode, and the price of XAI increased by 20% in 24 hours. Considering the upcoming airdrop from Blast or the upcoming staking mining from Metis, incentivizing stakers seems to be the trend in the market. For example, tonight, Starknet's native token will be launched. After a year of hard work, will you choose to stake or sell?

Zero-sum games are destined to be short-lived, but how long can a game with three wins last?

Welcome to join the official BlockBeats community:

Telegram Subscription Group: https://t.me/theblockbeats

Telegram Discussion Group: https://t.me/BlockBeats_App

Official Twitter Account: https://twitter.com/BlockBeatsAsia