Key Takeaways
- EigeLayer announced an airdrop of 15% of its total supply of 1.67 billion EIGEN tokens;
- The airdrop’s amount, documentation, non-transferability, linear distribution model, and geographical restrictions have sparked dissatisfaction among the community;
- In contrast, some experts defend the strategy as generous and effective against fraud.
The recent announcement of the EigenLayer airdrop has stirred mixed reactions among users.
EigenLayer, the second-largest restaking protocol with $15.67 billion in total value locked (TVL), detailed its airdrop plan in a blog post on April 29.
Did you know?
Want to get smarter & wealthier with crypto?
Subscribe – We publish new crypto explainer videos every week!
Since its launch, many users have been contributing their staked Ether (ETH) to the protocol in hopes of future rewards.
The foundation announced that 15% of EIGEN’s total supply — 1.67 billion tokens — would be distributed to the community. The initial phase awards 5% to early participants of Season One, with the remainder scheduled for future seasons.
This allocation strategy, however, has not sat well with everyone. Some community members find the share of tokens inadequate and the documentation confusing.
Users criticized the airdrop’s structure, which renders the tokens non-transferable until an unspecified future date. The Eigen Foundation, however, stated that this measure ensures the protocol’s key features, like payment systems and slashing parameters, are stable before enabling token transfers.
Moreover, additional controversy was sparked by the airdrop’s linear distribution model, as it favors larger stakeholders. One user said:
Honestly, the linear approach is stupid. Basically makes 1000-2000 Eigen stakers happy at the expense of 100k who will get peanuts. Reality is, those Eigen whales don’t care about loyalty either, they’ll leave as soon as a better opportunity presents. [REDACTED]
The discontent extends to geographical restrictions as well, since users from 30 countries, including the US, Canada, China, and Russia, are ineligible to claim their EIGEN tokens. Adding to the frustration, EigenLayer enforced these restrictions with measures like blocking VPNs.
In contrast, some industry experts believe the criticism may be overstated. Henrik Andersson, chief investment officer at Apollo Capital, argues that the 15% token allocation to the community is actually generous.
He also highlights that the linear distribution model is “clearly the fairest way and eliminates Sybil attacks.”
Despite mixed reactions to the airdrop strategy, the detailed planning reflects a balance between rewarding restakers and maintaining protocol stability.
In related news, Chudnov from the 3Jane crypto-native derivatives protocol has recently posted a thread suggesting that EigenLayer’s quick growth could lead to a yield crisis.
Having completed a Master’s degree in Economics, Politics, and Cultures of the East Asia region, Aaron has written scientific papers analyzing the differences between Western and Collective forms of capitalism in the post-World War II era.
With close to a decade of experience in the FinTech industry, Aaron understands all of the biggest issues and struggles that crypto enthusiasts face. He’s a passionate analyst who is concerned with data-driven and fact-based content, as well as that which speaks to both Web3 natives and industry newcomers.
Aaron is the go-to person for everything and anything related to digital currencies. With a huge passion for blockchain & Web3 education, Aaron strives to transform the space as we know it, and make it more approachable to complete beginners.
Aaron has been quoted by multiple established outlets, and is a published author himself. Even during his free time, he enjoys researching the market trends, and looking for the next supernova.
Register at Binance