The next is a sponsored visitor article from Sergey Shashev, the founder of Broxus.
From Group Rewards to the Hunt for “Free Money”
The group has been a driving power behind the growth of Web3 purposes and blockchains. Nonetheless, fostering and interesting a group is difficult, particularly for brand new initiatives. To deal with this, builders have applied numerous financial mechanisms, similar to ICOs and staking.
Airdrops, typically missed, current one other vital incentive for the group. This software has grown into a substantial area of interest. In response to CoinGecko, the three largest airdrops thus far—Uniswap, ApeCoin, and dYdX—collectively account for almost $12 billion. Over the previous three years, the whole worth of airdrops has reportedly surpassed $26 billion.
Initially designed to reward lively group members, airdrops have turn into so profitable that they’ve turn into a pasture for skilled opportunists who exploit them for private achieve. These opportunists create a number of accounts to finish duties set by organizers, both robotically or with low cost labor.
Their rigged exercise ranges from posting fundamental content material on social media and transferring small quantities of cryptocurrencies to spamming a protocol’s supply code with ineffective commits, all in pursuit of what they finally see as “free money.”
How Sybil Assaults Faucet Airdrops Dry
So, airdrop hunters have emerged as a brand new, actually malicious actor, disrupting the financial exercise inside Web3 and harming its future by diverting worth from real customers. In March 2023, Lookonchain reported on X (Twitter) about two “super airdrop hunters” who exploited the Arbitrum airdrop, gathering greater than $3 million value of ARB tokens from round 1500 addresses.
This incident is just not remoted. Most main airdrops in the final three years, together with these from Optimism, Uniswap, 1inch, and lots of others, have been equally targeted by hunters and their bot farms. An nameless raider claimed to The Block’s reporter, “Blur gave us something like $300,000, Arbitrum gave us around $180,000, Aptos gave us $125,000, and Optimism, $120,000.”
Not like true group members, airdrop hunters shortly dump their rewards, inflicting speedy worth drops, and transfer on to the subsequent goal. Starknet, a extremely anticipated Layer 2 blockchain constructed on Ethereum, skilled this firsthand. Researchers discovered that the community was infiltrated by airdrop hunters months earlier than the launch of its native cryptocurrency in February 2024. The outcome? STRK plummeted 50% in its first two days of circulation, jeopardizing Starknet’s future. The hunters’ actions even drew the consideration of the Chinese language police, who arrested an individual on costs of stealing STRK tokens by way of id scams.
Different initiatives, similar to Linea, EtherFi, and Connext Community, have additionally been drained by way of airdrops, experiencing what’s now termed a “Sybil attack,” a phenomenon in cybersecurity the place an attacker creates a number of pretend identities to realize affect or management in a pc community. If these perpetrators don’t get what they need, they typically publish defamatory statements about the venture on social media, spreading FUD. That is primarily a public extortion. We at Everscale have noticed such a marketing campaign against our accomplice blockchain community Venom, launched just a few months in the past.
Ongoing Seek for the Final Safety Against Sybil Assaults
Regardless of acknowledging the drawback, the trade has but to search out an efficient resolution. One strategy is to lift the eligibility standards for claiming airdrops. Nonetheless, even refined airdrop applications like Arbitrum’s didn’t stand up to the Sybil assault.
Some initiatives try and compromise, like LayerZero’s recent proposal to allocate smaller airdrops to looking accounts in the event that they self-identify as such. In any other case, their addresses risked being utterly excluded from an airdrop. Nonetheless, distinguishing pretend accounts from actual ones stays a problem, to not point out the precedent of recognizing wrongdoers as eligible recipients of group rewards.
Different options embrace implementing rigorous id verification for all airdrop members. Tasks like Worldcoin’s iris verification or Humanity Protocol’s palm recognition provide potential options, however such procedures might compromise consumer privateness, a core worth of Web3. Apart from, skilled drop hunters have already discovered workarounds for all types of “digital passports,” making a marketplace for shopping for and “pumping” digital identities in bulk. This measure solely raises the prices for fraudsters with out fixing the drawback.
One other resolution proposed by Vitalik Buterin is the Soulbound Token (SBT), an NFT completely sure to an actual individual (“soul”) that serves as a “proof of person” and identifier with out disclosing private particulars. Thus, SBTs might confirm a consumer’s fame in a decentralized method: if an SBT’s document reveals a optimistic fame rating, its proprietor features entry to airdrops, incentivizing benign habits. Nonetheless, SBTs are nonetheless extra of an idea and want broader adoption.
These and different choices are presently on the desk. My article requires wider dialogue and motion amongst all conscientious actors in the Web3 trade. We must tackle the concern of airdrop raiders earlier than much more Web3 initiatives and their conscionable supporters fall sufferer to new Sybil assaults. By understanding a common strategy and set of requirements collectively, we’d get an opportunity to as soon as once more make the most of airdrops for his or her root mission: compensating vivid communities for his or her loyalty and dedication.
About Everscale
Everscale is a TVM blockchain powered by an infinite sharding mechanism, flexibly adapting to any workload in order that the dimension of the load doesn’t have an effect on transaction instances or community charges.
This makes Everscale an optimum blockchain for internet hosting high-scale and load-intensive decentralized purposes. Over the previous years, Everscale has developed a thriving group and strong ecosystem of DeFi, GameFi, NFT, and different web3 initiatives.
