Ethereum L2 EigenLayer is the last of the ‘life-changing airdrops’, experts say
EigenLayer, an ongoing, highly inflated airdrop run by Ethereum's restaking protocol, continues to stir controversy over the threshold criteria for claiming rewards. Project founders and users from across the crypto ecosystem are clamoring for this.
“The reality is, in all likelihood, the era of life-changing airdrops is behind us,” said Leandro Schlotchauer, founder and CEO of smart contract developer Queen Labs. “It should be clear by now that no amount of airdrops or similar incentives can satisfy all members of the community,” he continued.
“Community members are divided by the master team's plan, including the amount passed on to previous contributors and the limited number of permissions users can claim.”
Meanwhile, Mohak Agarwal, co-founder of liquid-scale protocol Clystack, says that Eigenlayer's decision to announce its airdrop in a dramatic fashion is not a viable model in the long run. Agarwal says, “While the secretive approach may initially create excitement, it often leads to frustration later on.” “This pattern suggests that projects may offer small airdrops initially in anticipation of user frustration, and then offer more tokens to appease them – a short-term fix that is unsustainable in the long run.
In a surprise blog post on April 29, the second largest decentralized financial protocol, with a total value of $15.67 billion locked in, announced its airdrop plans, among other things, only 5% of the initial token supply will be allocated to early adopters who participated in Phase One. The remaining allocation will be distributed to beneficiaries in the following “Periods”. Additionally, users from 30 countries – including the US, Canada, China and Russia – cannot claim EIGEN tokens.
The ad quickly drew public condemnation. “It is not right to accept and reward shares from those countries. wrote one user on social media platform X in response to the protocol's geoblocking efforts. In response to community feedback, EigenLayer announced in a follow-up post on May 3 that an additional 28 million EIGEN will be downloaded to 280,000 wallets.
Despite increasing development activity in the crypto ecosystem, recent airdrops have often failed to track their initial traction.
On April 4, the cross-chain messaging platform wormhole transferred $800 million worth of W tokens to select users, with the post-airport valuation increasing to $22 billion with a fully diluted market capitalization. Since then, however, the token has lost more than 50% of its value and was trading at $0.6457 at press time.
Similarly, STRK, the native token of Ethereum layer-2 scaling solution Starknet, has lost 43% of its value since its February airdrop. At the time, it said, 701,544 eligible wallets were controlled by climate farmers who claimed STRK tokens by creating duplicate developer accounts on GitHub.
Cointelegraph previously reported that due to their popularity, airdrops were frequently targeted at farm accounts and Sybil accounts, thereby allocating large amounts of tokens to ineligible accounts rather than genuine ecosystem users. “As a result, the reputation of the project is damaged, the token supply may be inflated and the price may be inflated after the event is over due to over-disposal by farmers,” Gamik headquarters researchers commented on the incident.
Related: EigenLayer users rave about limited airdrops, others say it's ‘generous'
