The crypto community was abuzz with excitement as EigenLayer, a pioneering restaking protocol, announced its native token’s imminent airdrop. The team has scheduled the airdrop for May.
However, the details of this distribution have sparked widespread disappointment, highlighting a recurring issue with allocation strategies in blockchain initiatives.
Distribution of EIGEN Token Airdrop
Since its launch in June last year, EigenLayer has allowed users to deposit and restake Ethereum from various liquid staking tokens. Eventually, it became the second-largest DeFi protocol, with $15.952 billion in total value locked, according to data from DefiLlama.
The team introduced the native token, totaling 1.67 billion, to enhance the EigenLayer ecosystem. The independent non-profit Eigen Foundation allocated 45% of these tokens to community-related activities. These include stakedrops, community initiatives, and ecosystem development.
Read more: What Is EigenLayer?
The community’s initial enthusiasm diminished when they realized that only 15% of the tokens would be distributed through what EigenLayer called a “stakedrop.” Specifically, in the first distribution season, just 5% of the total token supply will be awarded to users based on a snapshot of their staking activities as of March 15, 2024.
Moreover, of this allocation, 90% won’t be claimable until May 10 and will not be immediately transferable, which compounded the frustration.
This allocation starkly contrasts the 55% of tokens designated for the project’s investors and early contributors. This disparity has sparked vocal criticism from within the crypto community, reflecting a broader debate over fairness in token distributions.
Crypto investor CoinMamba voiced their concern, pointing out the uneven allocation.
“So the EigenLayer team and investors are getting 55%, but stakers are getting only 5%, and even that will not be transferable at the beginning. The amount of greed crypto developers and VCs are exhibiting just keeps surprising me every time,” CoinMamba said.
This sentiment is widely shared, including by analyst – CryptoTelugu, who advocated for a more equitable airdrop:
“I think rewarding eligible users with a decent amount of tokens will make it a fair drop, at least 100 tokens. Let’s hope they hear us,” CryptoTelugu said.
Read more: Ethereum Restaking: What Is It And How Does It Work?
In light of the backlash, the Eigen Foundation may need to reevaluate its strategy to sustain goodwill and community support.
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