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Why the EigenLayer (EIGEN) Airdrop disappointed the crypto community
The crypto community was abuzz when EigenLayer, a pioneering retaking protocol, announced the upcoming airdrop of its native token. The team has scheduled the launch for May.
However, the details of this distribution have sparked widespread disappointment, highlighting a recurring problem with allocation strategies in blockchain initiatives.
EIGEN Token Airdrop Distribution
Since its launch in June last year, EigenLayer allowed users to deposit and buy back Ethereum from various liquid staking tokens. Eventually, it became the the second largest DeFi protocolwith a total value locked of $15.952 billion, second data by DefilLama.
The team introduced the native token, totaling 1.67 billion, to power the EigenLayer ecosystem. The independent, non-profit Eigen Foundation assigned 45% of these tokens are earmarked for community-related activities. These include stakedrops, community initiatives and ecosystem development.
To know more: What is EigenLayer?
The community’s initial enthusiasm waned when they realized that only 15% of the tokens would be distributed through what EigenLayer called a “stakedrop.” Specifically, in the first distribution season, only 5% of the total token supply will be allocated to users based on a snapshot of their betting activities starting March 15, 2024.
Furthermore, of this endowment, 90% will not be claimable until May 10 and will not be immediately transferable, which has added to the frustration.
This allocation contrasts sharply with the 55% of tokens going to project investors and early contributors. This disparity has sparked criticism within the crypto community, reflecting a broader debate about fairness in token distribution.
Cryptocurrency investor CoinMamba expressed his concern, highlighting the uneven allocation.
“So the EigenLayer team and the investors get 55%, but the stakeholders only get 5%, and even that will not be transferable at first. The amount of greed demonstrated by cryptocurrency developers and VCs continues to amaze me every time,” CoinMamba She said.
This sentiment is widely shared, including by CryptoTelugu analyst, who argued for a fairer airdrop:
“I think rewarding eligible users with a decent amount of tokens will mean a good drop, at least 100 tokens. Let’s hope they listen to us,” CryptoTelugu She said.
To know more: Ethereum restaging: what is it and how does it work?
In light of the negative reaction, the Eigen Foundation may need to reevaluate its strategy to sustain goodwill and community support.
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