Things I don't like about airdrop fundraising strategy in EOS

in airdrop •  6 years ago 

In Airdrops, often big exchanges are getting huge share of the tokens. This give them absurd influence. They have a lot of money so they can use that to hype up a project and when it reaches ATH, they can mercilessly dump their coins. And this could be used to hurt the legitimacy/reputation of other exchanges.

For example, lets say XT token was airdropped and it was listed only on bittrex. The coin gets very popular and is backed by a great project. There is a lot of volume on it and it is giving lots of profits to bittrex. Seeing this, Binance decides to take it down.

So, they buy a lot of it to up the price 25%. Then due to hype, the price goes up 75%. Now, Binance dumps lots of coins to crush it down 85%. The coins reputation will be severely hurt. People will start trashing the devs and bittrex. EOS will also receive criticism.

Things that airdrops could do to improve this:

  1. Find exchange wallets and exclude them.
  2. Airdrop a smaller amount of total supply (10% - 30%). This will have a lesser effect but it has its downside (founders holding too many tokens).
  3. Require users to register to be included in the whitelist. This will ensure that only people interested in it will take part. And the argument, "muh only shit projects request registration" is a weak argument. If the project is good, it doesn't matter how they did their airdrop. Many great projects allowed only whitelisted users in their ico (example, 0x ico).

Crosspost from Reddit.

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Airdrops are free money. People who receive free have less incentive to stay with it.

And are more likely to cashout their airdropped amount when it goes up. This leads to high volatility.

Very good points and I totally agree!

  ·  6 years ago Reveal Comment