DeFi
Decrypting DeFi is Decrypt’s DeFi email newsletter. (art: Grant Kempster)
Sybil farming ahead of alleged airdrops has become commonplace in crypto.
At the first whiff of a new token, hordes of wallet addresses get to work randomly interacting with a new project in hopes of generating loyalty signals and raking in the yet-to-be-launched cryptocurrency.
Airdrops typically retroactively reward a community’s “most loyal users.” Loyalty, though, can mean a lot of different things.
Is it measured by the number of transactions you make using a protocol? Is it the dollar amount you move? Or is it something completely different?
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Such attacks, called Sybil farming, are great for folks who make off with five-figure sums for clicking a few buttons, but it’s terrible for crypto projects attempting to build a real community.
It’s one of the more cynical aspects of crypto, and there have been few good solutions.
Hop Protocol is, however, taking a crack at solving the problem.
When the cross-chain bridging protocol announced that it’d be launching its native HOP token last year, it took painstaking measures to weed out any suspicious addresses. It took two key steps to do so.
First, it identified funding accounts that distribute to other, smaller accounts to farm an airdrop. Second on the chopping block were so-called chained accounts, in which accounts move from one airdrop to the next, picking up new tokens along the way.
This reportedly ousted more than 10,000 addresses from being eligible.
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They then took it a step further, inviting the community to take a stab at hunting down even more unloyal airdrop farmers.
The rules were simple: To join the ranks of the Sybil Hunters, users needed to submit at least 20 Sybil addresses, those addresses must be easy to verify, and the submissions should have a low chance of accidentally ousting a loyal community member.
If all checked out, those hunters were to be rewarded 25% of all HOP tokens with a one-year lockup.
Now, that lockup has ended, and, boy, were some of these hunters busy.
Per a Snapshot vote confirming the execution of this promise, we can see how several users managed to rake in more than 100,000 HOP tokens for their services.
That’s more than $8,000 at today’s prices.
Maybe there’s hope for airdrops after all.
Decrypting DeFi is our DeFi newsletter, led by this essay. Subscribers to our emails get to read the essay before it goes on the site. Subscribe here.
