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Only Allocate 5% to Deposit Users? Renzo Airdrop Triggers Community Backlash, ezETH Temporarily Sees Severe Depegging

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The opportunity window is very short, only available to the prepared. As of the time of publication, the ezETH peg situation has significantly improved, almost back to peg.

Original Title: "Renzo Airdrop Allocation Sparks Community Dissatisfaction, ezETH Suffers Severe Depegging"

Original Source: Followin

On April 24, the popular liquidity restaking project Renzo officially announced detailed token distribution rules, triggering dissatisfaction among many in the community. Renzo's ETH deposit token ezETH experienced a severe depegging, plummeting to a low of around $1600.

Early ezETH Sale Resets Points

According to the official rules, Renzo Season 1 incentives were set to end on April 26, and users who sold their ezETH holdings before this date may not be eligible for the airdrop. Users can claim REZ on May 2 through the official redemption website.

Whale Lockup at 50%, Bullish for Retail

Notably, large depositors on Renzo may be most affected, as the official plan involves a linear distribution of 500 million REZ (5% of the total supply) based on users' accumulated ezPoints, with the top 5% of addresses receiving 50% of the tokens unlocked at TGE and the remainder released linearly over 6 months. While this move displeased whales, it favored small retail participants, reducing selling pressure by avoiding whale dumping.

Only 5% Allocated, Depositors Feel "Let Down"

Undoubtedly, the most controversial part of Renzo's token distribution is the percentage of tokens allocated to protocol depositors.

The official allocation chart provided looked like this:

But in reality, it might be this:

Or more likely, this:

Crypto KOL @0xCaptainLevi stated that the Renzo protocol airdrop is a joke. Their whole business is built on depositors, yet they only give customers 5%, half of which is locked up, resulting in an actual airdrop of only 2.5%. It is absolutely clear that over the past six months, the 250,000 users who deposited $35 billion worth of ETH into Renzo will ultimately only receive a 2.5% airdrop, the same amount allocated for Binance Coin mining, while the team and investors receive 65% of the token distribution. Moreover, those who sell ezETH prematurely (Renzo's ETH deposit token, pegged 1:1 with ETH) will not qualify for the airdrop. Users risked putting funds into your protocol, yet the community did not receive a fair reward.

Perhaps the above view is not entirely accurate, but the community's dissatisfaction does exist. Coupled with the low liquidity pool of the ezETH token on Uniswap, the ezETH price has just experienced a significant deviation from its peg, with a sharp drop of up to 50%, reaching about $1600.

Deviation: A Buying Opportunity?

The sharp deviation was short-lived, but many people took advantage of this opportunity to buy the dip. According to on-chain analyst @ai_9684xtpa's monitoring, a whale bought 2499 ezETH with 2400 ETH during the ezETH deviation, worth $6.98 million, making a net profit of 99 ETH.

Many others have also shared their successful dip-buying results.

The window of opportunity was very brief, only for the prepared. At the time of writing, the ezETH peg situation has significantly improved, almost back to normal.