The essence of airdrops: scams, gifts, or donations?

Author: Wenser, Odaily Planet Daily

The airdrops of ZK (ZKsync) and ZRO (LayerZero) tokens have come to an end amidst a chorus of criticism and dissatisfaction. The airdrop of Blast, which claims to be the "number one in high-yield savings for L2 networks," is also on the way. The existential question of "what exactly is an airdrop" has once again sparked widespread market discussion. Odaily Planet Daily will summarize and analyze past industry opinions and recent statements from key figures in this article for readers' reference.

Jupiter Co-founder: Airdrops are Gifts, Not Rewards, Loyalty Programs, or Growth Strategies

During the heated discussions about whether ZK and ZRO are the "Endgame of Airdrops," Jupiter co-founder Meow posted on social media today stating: "Airdrops are gifts. They are not rewards, not a loyalty program, and not a growth strategy. They are simply a gift. It's that simple. If you ask what you can get from it, it is no longer a gift, losing its meaning and betraying the original sincerity. Goodbye. (Spanish)"

Interestingly, in a subsequent version, Meow deleted the last word "Adios (goodbye in Spanish)," perhaps feeling that the wording was inappropriate or that the expression of "saying goodbye to users" was too decisive.

However, it is clear that he views airdrops as a medium for friendly interaction between the project and users—much like a "gift" that a friend brings when visiting your home. It is nice to receive one, but the absence of such a gift should not lead to resentment towards the project.

LayerZero CEO: Pioneering the Concept of Donating Before Claiming Airdrops

As a leading cross-chain interoperability protocol, LayerZero was previously highly anticipated by the market. Its token airdrop was once expected to be on par with ZK (ZKsync), one of the "four kings of L2." However, the attitude of project CEO Bryan Pellegrino (hereinafter referred to as Bryan) towards token airdrops is clearly different from the ZKsync official account, which directly stated that "there will be no large-scale witch hunts." Previously, perhaps to "ensure that real users receive their rightful airdrops," LayerZero launched a nearly two-month-long "witch hunt" campaign on the X platform. Many users were on edge, but the final results of single accounts receiving single or double-digit airdrops left many disappointed—"I thought something big was coming, but it turned out to be big in a different way, as expected from the stinky penguin (the username suffix of Bryan on X)."

Moreover, as the CEO of LayerZero, Bryan clearly has his own views on token airdrops.

On June 20, regarding the requirement to donate 0.1 USD worth of tokens for each ZRO token before claiming the LayerZero airdrop, Bryan responded, "There is no mandatory donation; if you don't want to donate, don't claim the tokens. They are not yours; they are provided by others." Combined with previous actions and statements, Bryan seems to view token airdrops more as "a form of 'charity' or even 'bribery' from the project to users. Therefore, to some extent, users have both the necessity and obligation to contribute to the project's subsequent development through donations."

It must be said that as token airdrops enter a "mature development phase," the unspoken rules of "collusion" between projects and users regarding token airdrops have failed at LayerZero and with Bryan. The two parties are no longer "comrades" jointly supporting the project's valuation and market cap but have become "enemies" of each other.

Regarding LayerZero's mandatory donations, Yearn core developer banteg commented that such forced donations resemble a beautified ICO. He also called for an end to bulk funding for Protocol Guild, as it has already successfully attracted funding and should seek to support other smaller initiatives.

Uniswap Founder: "Don't Be Stingy with Token Distribution"

As a pioneer in the "token airdrop" space that began in September 2020, Uniswap founder Hayden Adams (referred to as Hayden) holds views on token airdrops that may align more closely with the expectations of most in the cryptocurrency market. More importantly, he indeed practices what he preaches—

• The previous Uniswap airdrop received unanimous praise from the market;
• Within three hours of the UNI token's launch, it attracted 13,000 active users, with gas fees reaching $650,000;
• The threshold was clear and relatively low, mainly "distributed based on the snapshot from September 1, 2020, to 'historical liquidity providers, interactive users, and SOCKS redeemers/holders,' etc.";
• A single user address could claim 400 UNI, which was worth $1,344 at the time, and just a few months later, the value of this airdrop peaked at nearly $12,000, truly a "big gift."

UNI Token Distribution Chart

It is worth noting that the issuance of the Uniswap token airdrop had complex internal and external reasons: internally, community members were continuously urging for token issuance, while externally, they faced fierce competition—most directly influenced by competitors like SushiSwap launching a "vampire attack" through token issuance. According to media reports at the time, from September 7 to 9, 2020, Uniswap's TVL dropped from $1.72 billion to $518 million within 48 hours; although it briefly rose above $1 billion on September 10, quickly regaining market leadership, competition remained intense.

At that time, Ethereum co-founder Vitalik Buterin also commented on the SushiSwap incident in a tweet, expressing his views. He believed that Uniswap founder Hayden Adams was an excellent industry participant, and the team had put in years of effort to make honest decisions—while others rushed to ICO as quickly as possible, Uniswap was not in a hurry to issue tokens, but it was attacked for it in the past two weeks. He noted that Uniswap had been developing since its launch, and saying that Uniswap was irresponsible to the community was not accurate. He openly supported and stood by them.

In May of this year, when "points systems dominated many crypto projects," Hayden also expressed his views on token distribution. Besides clearly stating "tokens, not points," the most important point he made was, "Don't be stingy with token distribution." His exact words were: "Don't be stingy—generously give out a lot. If project founders believe the community does not deserve a lot, then don't release tokens."

Additionally, he mentioned: do not blindly pursue the number of farmers; ensure real liquidity from day one; do not provide excessive token supply to biased farmers; do not promote token prices; keep it simple; invest genuine thought and care into token decisions.

As early as July 2023, Hayden stated that he hoped to see more projects utilize the "superpower" of crypto to disrupt mainstream Web2 apps and discover new use cases, rather than making marginal improvements around existing Web3 use cases (AMM, lending, etc.). He emphasized the need to launch vampire attacks on Web2 instead of continuously forking Uniswap.

In the author's view, Hayden sees airdrops as a means to respond to market competition, a bond that can create more connections with the community, a medium that can involve genuine thought and care, and a "superpower" that can launch vampire attacks on Web2, rather than a stingy "variant of points."

Conclusion: The Essence of Airdrops—An Alternative Investment in Marketing Costs

From the perspective of users who have interacted countless times without receiving airdrops or whose airdrop returns fall short, airdrops are often seen as a scam—"What I value is their token airdrop; what they value is my principal and transaction fees."

From the viewpoint of VCs, funds, and investors who have invested in numerous crypto projects, airdrops are a natural "return on investment"—"I invested so much money, time, and effort upfront; now receiving some token returns is quite reasonable, right?"

For some founders and team members who believe that "the project's success mainly relies on the project team itself," airdrops are gifts to "users who actively cooperate," a "gift you should cherish," and while they may not express overwhelming gratitude, they should at least feel thankful, right?

However, in the author's view, just as the main product in the Web3 field or the cryptocurrency industry is Token, airdrops are essentially an alternative investment for "seed user accumulation, external promotion, and product brand marketing."

Project teams should neither be overly generous, distributing most tokens to "farmers," "big spenders," or "cluster witches," nor should they be extremely stingy, causing loyal users who have accompanied the project from 0 to 1 or even 100 to feel disheartened or even "turn against each other."

A qualified token airdrop should resemble a Marketing Campaign, based on clear goals and serving the overall development of the project, executed through meticulous thought and detailed planning, ultimately achieving a certain degree of "decentralized distribution" of token chips and successfully shaping the project's market reputation and brand image.

Therefore, future project teams should reach a consensus: token airdrops are a subtopic of marketing, and airdrops with negative effects are better off not being issued.