Continuous token distribution is an innovative approach where, instead of a single airdrop, multiple airdrops are scheduled over a period of time. This strategy aims to maintain user engagement and incentivize ongoing participation in the project's ecosystem. By distributing tokens in phases, projects can ensure that users remain active and committed, which helps sustain and grow the user base and overall project activity.
The primary expectation with continuous token distribution is that it encourages sustained user engagement. Users who receive tokens in phases are more likely to continue using the platform to qualify for subsequent airdrops. This approach can lead to higher Total Value Locked (TVL) and increased transaction volume, as users remain motivated to participate and contribute to the ecosystem.
1inch - an example of continuous token distribution
Consider the 1inch decentralized exchange aggregator, which has implemented multiple airdrops. By analyzing the changes in its user base and TVL, we can gain insights into the effectiveness of continuous token distribution.
First Airdrop (December 2020)
1inch launched its governance token, 1INCH, and distributed tokens to users who had interacted with the platform before December 24, 2020. This initial airdrop significantly increased 1inch’s user base and generated substantial interest in the platform.
Second Airdrop (February 2021)
Following the initial success, 1inch announced another airdrop targeting users of Mooniswap, Uniswap, and Sushiswap who had not yet interacted with 1inch. This airdrop attracted users from competing platforms, further increasing 1inch’s user base and liquidity.
Impact
As a result of these phased airdrops, 1inch experienced improved user retention rates and a steady increase in volume. Users kept trading within the ecosystem to qualify for future rewards, leading to sustained growth and activity on the platform.
Continuous Airdrops on Starknet
In Starknet, there are currently two noteable projects that have embraced the concept of continuous airdrops (Starknet itself and zkLend). Both projects have successfully completed Phase 1 of their airdrop campaigns and are preparing for Phase 2.
Starknet has announced that they will be running a series of airdrops to reward early users of the network. By conducting multiple airdrops, Starknet aims to sustain user engagement and grow its ecosystem. Phase 1 saw a significant increase in user participation and TVL, and Phase 2 is expected to build on this momentum. This approach helps in maintaining a robust and active community within the Starknet ecosystem. Additionally, the StarkNet DeFi Spring initiative distributed tokens to users, further incentivizing participation and contributing to the ecosystem's growth.
zkLend, a lending protocol on Starknet, is another example of continuous airdrops. zkLend completed its Phase 1 airdrop, generating substantial interest and engagement. Users who participated in the initial airdrop were incentivized to continue interacting with the platform in anticipation of Phase 2. This phased approach has helped maintain zkLend's TVL as users kept their assets in the platform to qualify for future airdrops. With multiple airdrops planned, zkLend continues to build a strong and active community.
As more projects on Starknet and other blockchain networks recognize the benefits of continuous token distribution, we can expect to see an increase in phased airdrop campaigns. This approach helps maintain user interest, encourages long-term commitment, and promotes a healthy and active ecosystem. By continually rewarding users, projects can achieve sustained growth and development.
Continuous token distribution is a powerful strategy for maintaining user engagement and fostering long-term participation in blockchain projects. By implementing phased airdrops, projects can incentivize users to stay active and contribute to the ecosystem, leading to increased user retention and higher TVL. As evidenced by ongoing campaigns on Starknet, such as those by zkLend, this approach can significantly benefit projects and their communities. As more projects adopt continuous token distribution, we can expect to see more robust and dynamic blockchain ecosystems.
Carmine Options serves as an automated market maker, offering the opportunity for anyone to buy and sell options on the Starknet network at a fair price.
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