The restrictive qualifications for claiming rewards in the ongoing airdrop conducted by Ethereum restaking protocol EigenLayer have sparked controversy and drawn criticism from project founders and users in the crypto community. Leandro Schlottchauer, co-founder and CEO of smart contract developer Kuyen Labs, stated that the era of life-changing airdrops is likely over and no airdrop can satisfy all community members. Mohak Agarwal, CEO and founder of liquid-staking protocol Claystack, criticized EigenLayer’s surprise announcement approach, noting that it often leads to disappointment and is not sustainable in the long run.
EigenLayer, the second-largest decentralized finance protocol with $15.67 billion in total value locked, unveiled its airdrop plans in a surprise blog post on April 29. The announcement revealed that only 5% of the initial token supply would be allocated to early users who participated in Season One, with the rest distributed in subsequent seasons. Additionally, users from 30 countries, including the United States, Canada, China, and Russia, would not be eligible to claim EIGEN tokens.
This announcement received widespread condemnation from the community, with users expressing dissatisfaction over excluding certain countries. In response to the feedback, EigenLayer announced on May 3 that they would airdrop an additional 28 million EIGEN to 280,000 wallets.
Recent airdrops in the crypto ecosystem have failed to maintain their initial traction. For example, Wormhole, a cross-chain messaging platform, transferred $800 million worth of its W tokens to select users, resulting in a post-airdrop valuation of $22 billion. However, the token’s value has since dropped by more than 50%. Similarly, the native token of Ethereum layer-2 scaling solution Starknet, STRK, has lost 43% of its value since its February airdrop, which was marred by airdrop farmers creating duplicate developers’ accounts on GitHub.
Airdrops have become targets for farm accounts and Sybil accounts, leading to the allocation of tokens to unqualified accounts instead of genuine ecosystem users. This practice damages a project’s reputation, inflates token supply, and may result in price manipulation due to excessive dumping by airdrop farmers.
In conclusion, EigenLayer’s restrictive airdrop qualifications have sparked controversy, highlighting the challenges and shortcomings of airdrops in the crypto ecosystem.