1. Introduction and Philosophy

Airdrops have become a powerful tool for blockchain projects to engage communities, rewarding users while fostering network participation. Additionally, airdrops effectively make liquidity available to the general public, ensuring that tokens are in circulation for wider use.

However, community sentiment around airdrops can vary significantly, influenced by perceived value, timing, and whether they are seen as gifts or rewards. This article explores these perceptions, delving into airdrops’ psychological, philosophical, and historical aspects to understand the nuances behind their reception and impact.

Introduction

Airdrops, at their core, were initially designed for projects to distribute tokens widely, ensuring a more decentralized ecosystem by reaching the largest number of users. However, as is widely recognized today, the principal motive behind airdrops has evolved; they now serve as powerful tools for catalyzing network activity. This surge in activity provides valuable metrics for projects, helping them attract potential investors and support funding rounds, both before and after the TGE.

Yet, limiting the purpose of airdrops to an injection of capital overlooks their broader potential. Airdrops have become a crucial marketing method for bootstrapping user bases by bringing in new participants and incentivizing them to engage with a project. These initial interactions are pivotal, but retention becomes essential to sustain the benefits that airdrops offer. Users must see the value in holding and engaging with their rewards, not just claiming and liquidating them for short-term gains. This is where mindshare—the collective awareness and emotional connection within a community—plays a fundamental role.

Imagine an explorer stumbling upon an uncharted path filled with hidden treasures yet to be valued. The explorer ventures forward, but soon realizes that uncovering all the riches requires more hands and sharper eyes. They call upon friends to join the search, sparking a wave of exploration that attracts more and more participants. As this bustling activity grows, the surrounding markets take notice. Although these treasures have not yet been priced, the sheer attention and anticipation signal that, once revealed, their value will be immense.

This collective interest sets the stage for a high initial valuation when the treasures do reach the market, creating a network effect that elevates the product’s reputation and ensures substantial future gains for all involved. But what happens with mindshare if all this hard journey has been in vain and the treasures weren’t what they expected? What would the reflection be for the treasure hunters?

Mindshare is key to this process, acting as the glue that keeps users engaged beyond the initial excitement. When recipients feel a genuine connection to the project, they are more likely to view their tokens as part of a greater opportunity rather than just a quick profit. This sentiment is vital to prevent immediate sell-offs that can suppress token value. Projects that build strong mindshare foster a sense of belonging and purpose among users, encouraging them to participate in governance, share feedback, and promote the project within their networks. This deepened commitment helps convert passive recipients into active contributors, securing the project’s long-term growth and stability.

Introduction to Community Sentiment and Mindshare

Community sentiment, or “mindshare”, is a crucial metric in assessing a project’s standing within the cryptocurrency ecosystem. Mindshare reflects the collective awareness, perception, and emotional connection that a community has toward a project.

This sentiment becomes especially important in the context of airdrops, which are more effective when recipients feel a sustained attachment to the project⁷. To maximize the impact of airdrops, projects must understand the drivers behind positive mindshare and the factors that contribute to lasting community sentiment⁷.

A foundational perspective on community attachment identifies four essential elements for fostering a sense of belonging within a community: membership, influence, integration and fulfillment of needs, and shared emotional connection¹. These elements create a bond that, when aligned with project goals, can make recipients feel they are integral to the project’s success. Airdrops designed to reflect these principles—by granting recipients meaningful roles or creating shared milestones—can shift participants’ perspectives from passive receivers to active community members¹.

Importance of Community Sentiment in Airdrops

Given that airdrops often introduce new users to a project, their initial impression can be vital. Studies suggest that attachment to a community depends on its potential for future growth and the quality of social engagement it offers². In airdrops, offering real utility or clear paths for involvement can give users a sense of purpose, inspiring long-term loyalty. This research into community attachment demonstrates that projects can deepen user engagement by fostering optimism about the project’s future and cultivating social opportunities, both of which encourage lasting bonds beyond the initial airdrop².

Further, the economic perspective on gifts underscores the importance of intent in shaping perceptions. Gifts, and by extension airdrops, are often valued based on whether they appear genuine or merely transactional. If recipients perceive a gift as strategic, it may feel more like a marketing tactic than a gesture of goodwill, which can erode trust⁴. Similarly, airdrops designed with clear, value-adding intent—whether in the form of meaningful governance roles or exclusive access—are more likely to inspire positive sentiment and increased engagement⁴.

Psychology and Sociology of Gift Perception

Gift perception, shaped by psychological and social contexts, is a critical factor in determining whether an airdrop is seen as a “gift” or merely a “reward.” Research on gift-giving describes it as a cycle of giving, receiving, and reciprocating, where the act of giving strengthens social bonds³. When airdrops come unexpectedly, they can evoke a strong positive response, similar to how surprise bonuses enhance loyalty and trust in employment contexts. Studies show that bonuses are most effective when unexpected, generating goodwill and enhancing motivation⁵. Applying this insight to airdrops, unexpected distributions can foster a sense of appreciation and encourage recipients to reciprocate through greater engagement³ ⁵.

Moreover, the perception of an airdrop can shift depending on whether it’s seen as an entitlement or a true gift. Studies show that incentives regarded as contractual lose motivational impact⁵. In airdrop contexts, announced distributions may fall short of driving sentiment if they are perceived as routine. Conversely, unanticipated airdrops can elevate the experience, as recipients may feel genuinely valued and more inclined to stay loyal to the project. Crafting surprise airdrops, therefore, can help projects maintain positive sentiment without recipients developing expectations of regular distributions⁵.

Factors Influencing Community Sentiment in Airdrops

Several factors shape how an airdrop is perceived and the level of mindshare it generates. Timing and distribution methods are key, as studies observe that airdrops aligning with community values and providing clear utility encourage stronger loyalty and participation⁷. Additionally, research highlights the influence of historical performance on expectations. If previous airdrops were profitable, recipients may anticipate high returns, yet repeated disappointments can lead to disenchantment⁶. Managing these expectations by designing each airdrop with unique attributes can help projects retain community trust while avoiding predictable patterns⁶.

Another crucial factor is transparency around the airdrop’s purpose. Research suggests that projects need clear, well-communicated goals to mitigate the tendency of recipients to immediately sell tokens⁷. When recipients understand the airdrop’s intent—whether it is to encourage governance participation or build an engaged user base—they are more likely to feel a sense of purpose and value, increasing the likelihood of positive sentiment and longer-term loyalty⁷.

In summary, understanding and enhancing community sentiment is pivotal in designing successful airdrops. By applying principles from community psychology and gift-giving studies, projects can build stronger community bonds, foster trust, and inspire sustained engagement. Airdrops, when strategically implemented, can go beyond mere token distribution to become a meaningful expression of appreciation and community value.

The following points summarize, based on the studies seen, the critical aspects to consider when designing airdrop strategies that build strong, lasting connections with users:

• Mindshare as a Driver for Loyalty: Studies show that strong community sentiment (mindshare) enhances airdrop effectiveness by ensuring recipients feel connected to the project, fostering loyalty and long-term retention⁷.
• Turning Recipients into Active Members: Research on community attachment emphasizes that incorporating elements of membership and shared milestones can transform users from passive recipients to engaged participants¹.
• Impact of Initial Engagement: Community psychology underscores that airdrops offering utility and involvement create a strong first impression, inspiring continued participation and loyalty².
• Genuine vs. Strategic Perception: Economic studies on gifts reveal that when airdrops are perceived as authentic and not purely transactional, they build trust and positive sentiment, driving deeper engagement⁴.
• The Power of Unexpected Rewards: Psychological insights indicate that unexpected rewards, such as surprise airdrops, enhance user motivation and loyalty, while transparent communication prevents token sell-offs and supports sustained engagement³ ⁷.

2. Context

Once we understand how human behavior works in context, along with some psychological terms regarding users—both individually and collectively—we can empirically assess how different airdrops have played out and what behavior the users have adopted. We can identify which ones have had the best outcomes, which ones haven’t, and what they have in common. This involves gathering various metrics of interest and observing the market context at the time of each launch.

Over the past few years, numerous airdrops have been conducted, each with unique characteristics and varying outcomes. To understand their impact, it’s essential to examine notable airdrops across different sectors.

As part of our research, we analyzed airdrop strategies across three key categories: L2 networks, perpetual trading protocols, and Liquid Restaking protocols. These categories represent essential building blocks of the blockchain ecosystem, and their airdrop campaigns provide insight into how projects bootstrap growth, attract users, and foster long-term engagement.

Layer 2 Solutions based on Ethereum

L2 projects play a vital role in scaling the crypto ecosystem by alleviating congestion and reducing transaction costs on Layer 1 networks like Ethereum. These solutions enhance throughput while maintaining the security and decentralization of the base layer. Due to their scalability potential and ability to drive broader adoption, L2s often attract significant VC investments. One key characteristic of L2s is their high Fully Diluted Valuations (FDVs), reflecting their potential to replicate the growth of established L1s while providing essential infrastructure for decentralized applications.

The four projects analyzed in this study are:

Arbitrum

Arbitrum’s (ARB) airdrop was designed to reward users who actively engaged with its Layer 2 network. Eligibility focused on users who bridged funds to@Arbitrum""> @Arbitrum and conducted transactions in its ecosystem. Unlike other projects, Arbitrum emphasized a broad distribution to ensure widespread participation. Its unique focus on early adopters fostered community loyalty and engagement, creating a strong foundation for governance. By rewarding activity across a diverse range of applications within its ecosystem, the airdrop stood out for its inclusivity and its aim to incentivize adoption at scale.

Starknet

@Starknet"">@Starknet airdrop focused on rewarding users who engaged with its zk-rollup technology, prioritizing activity on its testnet and mainnet applications. Eligibility criteria were tied to interaction with dApps and early experimentation with its innovative scaling solutions. What sets Starknet apart is its emphasis on technical adoption, rewarding users who tested the protocol and contributed feedback during its developmental phase. This airdrop not only incentivized participation but also fostered a technically engaged community aligned with its zk-rollup vision.

zkSync

@zkSync"">@zkSync airdrop emphasized early engagement with its zk-rollup-based Layer 2 solution. Eligibility criteria focused on users who bridged assets to zkSync interacted with its ecosystem of dApps, and explored features enabled by zero-knowledge proofs. By incentivizing a broad range of network activities, the airdrop aimed to foster a community deeply invested in the protocol’s advancements and long-term vision.

Perpetual Decentralized Exchanges (PerpDEX)

The perpetual trading market is emerging as one of the most dynamic and promising areas in DeFi, offering immense untapped potential compared to the staggering volumes currently handled by centralized exchanges. As decentralized finance continues to grow, perpetual protocols are carving out a niche by introducing innovative solutions that decentralize and democratize perpetual futures trading. These protocols are leveraging airdrops as a strategic tool to attract traders, liquidity providers, and early adopters, effectively positioning themselves as strong and viable alternatives to centralized platforms. In this study, we have analyzed three standout projects to better understand their approaches and impact:

Aevo (ex: Ribbon Finance)

Previously known as @RibbonFinance (where they already did an airdrop), @Aevoxyz underwent a rebranding and token migration process, introducing a new protocol focused on having a derivatives trading platform, particularly options. As part of this transition, Aevo decided to distribute a portion of its treasury as an airdrop to incentivize users to adopt the new platform. The airdrop prioritized early adopters who demonstrated consistent activity, including placing and executing trades. What differentiates Aevo is its emphasis on options trading, a niche within the DeFi space, allowing the project to target a specific segment of traders.

Drift Protocol

Drift’s airdrop targeted users who actively traded on its decentralized perpetual exchange. The eligibility criteria focused on trading volume and frequency, ensuring rewards were allocated to committed traders who contributed to the platform’s liquidity and activity. @DriftProtocol stood out by emphasizing professional-grade trading tools within a decentralized framework, making it particularly appealing to advanced traders. Its airdrop aimed to solidify its user base by rewarding loyalty and encouraging continued participation in the derivatives trading ecosystem.

Jupiter Exchange

Jupiter’s airdrop aimed to reward users who utilized its aggregator platform on Solana to find the best trading routes and liquidity options. Eligibility criteria included interaction with the platform’s routing tools and active engagement in swapping tokens through Jupiter. Unlike Drift and Aevo, which cater to derivatives traders, @JupiterExchange focused on ease of use and liquidity aggregation, appealing to everyday DeFi users. The airdrop incentivized continued usage and reinforced its position as a go-to tool for token swaps on Solana.

Liquid Restaking

Liquid Restaking protocols represent a new and rapidly evolving category within DeFi, born out of the restaking model introduced by EigenLayer. These protocols were initially designed to enhance the utility of staked assets by allowing them to secure multiple networks, effectively unlocking additional value from otherwise idle capital.

However, these protocols are now expanding their scope, exploring new functionalities that enhance the value of both the protocol and its associated token. Initially relying on EigenLayer as a platform for re-staking Ethereum already securing the Layer 1, Liquid Restaking Token (LRT) protocols are gradually shifting toward building independent ecosystems. By developing unique use cases and broadening their applications, they aim to reduce their dependency on EigenLayer and establish themselves as versatile and self-sustaining solutions.

All LRTs projects benefited from EigenLayer incentives. As users sought to farm EigenLayer rewards, LRTs attracted them by offering additional points or tokens on top of EigenLayer rewards. This effectively amplified the rewards for users. Had these users staked directly on EigenLayer without engaging with LRTs, they would have missed out on these extra tokens.

This analysis focuses on three standout projects:

Ether.fi

Etherfi’s airdrop was designed to promote its decentralized Ethereum staking protocol, targeting users who actively staked ETH or participated in governance. Unlike other protocols, @Ether_fi highlighted user sovereignty, allowing stakers to maintain full custody of their assets through LRTs while participating in the network. The eligibility for the airdrop focused on staking activity and governance contributions, prioritizing users who were already aligned with the protocol’s mission of decentralization and active participation.

Puffer Finance

Puffer’s airdrop focused on making liquid restaking more accessible, leveraging integration with Eigenlayer to attract users. Eligibility was based on interaction with Eigenlayer’s restaking infrastructure, broadening the scope to include both new users and advanced stakers experimenting with modular staking solutions. Unlike Etherfi or Renzo, @Puffer_finance emphasized simplicity, lowering entry barriers while maximizing rewards through advanced restaking mechanisms. This approach positioned it as an entry point for users exploring Ethereum staking for the first time or seeking innovative ways to enhance their staking returns.

Renzo Protocol

Renzo’s airdrop targeted users engaged in liquid restaking through its platform, with eligibility criteria focusing on those who restaked their assets and contributed to liquidity pools. This ensured the rewards reached participants who actively supported the ecosystem’s liquidity and security. @RenzoProtocol differentiator lies in its focus on capital efficiency, enabling stakers to simultaneously earn rewards and use their staked assets across DeFi applications. This dual utility made Renzo particularly appealing to users looking for optimized returns while participating in a flexible staking environment.

Community Mindshare

Analyzing community mindshare is a complex endeavor. It involves not just tracking visible indicators like social media activity but also accounting for intangible factors like personal conversations and nuanced sentiment. While some tools attempt to measure sentiment by aggregating posts and interactions, their accuracy is often limited by the presence of bots and insufficient historical data. Given these limitations, we propose an alternative approach to evaluate mindshare.

Our method integrates quantitative and qualitative analyses. Quantitative data focuses oCollateral Airdropsn activity metrics that reflect engagement within the community, while qualitative data examines the sentiment and perception surrounding each airdrop’s execution. By comparing pre- and post-TGE (Token Generation Event) metrics, we aim to uncover patterns that reveal how airdrops influence mindshare and user behavior.

Quantitative Metrics

These metrics provide a quantitative view of user engagement, economic activity, and platform performance, offering insights into how airdrops influence participation and adoption:

Layer 2 Solutions:

Daily Active Users (DAU)

DAU tracks the number of unique users interacting with the protocol daily. For L2 solutions, this metric reflects the ability of the network to scale and attract users by offering lower fees, faster transactions, and seamless dApp integration. DAU spikes, especially before airdrops, show heightened user interest, but sustained activity afterward signifies deeper trust in the ecosystem and the acceptance of its real utility.

Monitoring DAU in L2 solutions helps evaluate whether airdrops translate into long-term user retention or just airdrop farmers. This is critical for fostering a sense of belonging and sustained network activity after the TGE.

Daily Netflows

Inflows measure the assets bridged from Ethereum to the Layer 2 network. Pre-airdrop inflows represent users moving funds to qualify for rewards, while sustained inflows post-airdrops show ongoing adoption and network confidence.

Sustained post-airdrop inflows highlight whether the airdrop succeeded in driving real ecosystem growth. Research on “expectations and behavior in rewards” suggests that predictable incentives (like airdrops) may lead users to explore the ecosystem, but the utility offered post-reward is what sustains engagement.

Total Value Locked (TVL)

TVL measures the assets locked within a protocol and reflects users’ economic trust. Pre-airdrop TVL often grows as users prepare to meet eligibility criteria. Still, post-airdrop changes show whether users view the protocol as a long-term financial investment or farmed for the reward.

A gradual increase in TVL after an airdrop highlights trust and confidence in the ecosystem. Papers on reward predictability emphasize that users commit funds long-term only if they perceive the protocol as delivering ongoing utility and reliability, as well as innovation and opportunity from the developers of the dApps on the chain, which is possible with some rewards like grants.

Perpetual Decentralized Exchanges (PerpDEX):

Trading Volume

Trading volume tracks the total value of trades executed on a PerpDEX, reflecting the platform’s activity level and liquidity. Pre-airdrop spikes often indicate speculative trading as users aim to meet eligibility criteria, while sustained trading volume post-airdrop suggests the platform has successfully retained active traders and attracted new participants.

The high post-airdrop trading volume demonstrates the protocol’s ability to maintain interest and liquidity in its ecosystem. Studies on trading behavior suggest that users’ willingness to continue trading after the airdrop reflects confidence in the platform’s usability and its long-term viability as a trading venue.

Open Interest (OI)

Open Interest measures the number of outstanding contracts on a PerpDEX, providing insights into the engagement and participation of active traders. Pre-airdrop OI increases as speculative users enter the market to qualify for rewards. Post-airdrop OI stability or growth indicates a committed user base engaging with the platform’s derivative products.

Stable or growing OI post-airdrop shows the protocol’s success in retaining its core trader base. Research on financial incentives highlights that consistent engagement in trading platforms correlates with user trust and satisfaction, key factors in building a sustainable trading ecosystem.

Active Daily Users

DAU for PerpDEXs tracks trading activity and the number of unique traders interacting with the platform. Pre-airdrop spikes typically indicate speculative trading volume, while consistent post-airdrop activity suggests trust in the protocol’s trading environment.

Regular trading activity demonstrates whether airdrop recipients remain engaged or simply exit after claiming their rewards. Behavioral finance research highlights that consistent DAU indicates a trader’s belief in the platform’s sustainability, and above all, a functional and comfortable platform to meet the needs of users.

Liquid Restaking Tokens (LRT):

Total Value Locked (TVL)

TVL for LRT protocols reflects the value staked and restaked within the platform. Pre-airdrop growth indicates user positioning for eligibility, while post-airdrop TVL reveals trust in staking mechanisms and confidence in the protocol’s ability to deliver other rewards.

Post-airdrop TVL stability is critical in LRT projects to assess whether airdrops incentivize long-term staking behavior. Studies on the economic perception of gifts indicate that when rewards feel genuine, users are more likely to continue investing in the ecosystem. This ties directly to the concept of community belonging through healthy economic engagement.

Number of Users

For LRT protocols, DAU measures the engagement of stakers and restakers within the protocol. The pre-airdrop activity reflects speculative interest, but post-airdrop DAU stability reveals long-term trust in staking mechanisms and rewards.

DAU helps evaluate whether airdrop recipients transition from passive participants to active members, a key metric for community attachment. A study on “reciprocity in incentives” highlights that protocols sustaining engagement post-airdrop are likely fostering a deeper emotional connection and incentivizing further interaction, essential for building community loyalty, in this case, related to governance.

Qualitative Metrics

To evaluate the effectiveness and impact of various airdrops, we consider a range of characteristics that shed light on their design and reception. Each factor provides insights into user behavior, distribution fairness, and the broader implications for the project and its community. Below are the key characteristics with brief explanations.

Airdrop % of Total Supply

The percentage of the project’s total token supply allocated to the airdrop. This metric reflects the project’s commitment to decentralization and user rewards.

Total Airdrop ($)

The monetary value of the airdrop at distribution time. This indicates the financial significance of the airdrop and its potential impact on user sentiment.

Airdrop Recipients Number

The total number of unique addresses receiving the airdrop. A larger number may suggest efforts to reach a broader community, while a smaller number could imply exclusivity.

Was the Airdrop Well Distributed Among Users?

Evaluates the fairness of the distribution, considering whether a small percentage of recipients controlled a disproportionate share of the tokens.

Was it the First Airdrop of Its Kind?

Determines whether this was the inaugural airdrop for the project or category, potentially increasing excitement and anticipation among participants.

Did People Farm the Airdrop on Purpose or Just Use the Product Because They Needed It?

Distinguish between users engaging solely to qualify for the airdrop and those who used the product out of genuine necessity, highlighting the organic vs. incentivized user base.

How Much Time Elapsed Since the Beginning of the Farming?

Tracks the duration between when farming activities began (e.g., the announcement of criteria or mainnet launch) and the airdrop, providing insights into user commitment over time.

Did It Require to Spend Much Time?

Assesses whether the farming process was time-intensive, potentially deterring casual users or attracting more dedicated participants.

Did It Require to Spend Much Money?

Evaluate the financial cost of qualifying for the airdrop, including transaction fees or necessary investments, which could influence participation accessibility.

Was It Practically Necessary to Maintain Liquidity for at Least 1 Month

Analyzes whether participants had to provide and sustain liquidity for an extended period, encouraging long-term engagement and reducing speculative behavior.

Did the Project Achieve PMF Before the Airdrop Was Distributed

Determines whether the project had demonstrated product-market fit (PMF) before the airdrop, ensuring the airdrop supplemented an already viable ecosystem.

Did the Users Like the Project? (The dApp, the Chain, etc.)

Explores user satisfaction with the project’s core offering, providing qualitative insights into its adoption potential beyond the airdrop.

Previous Released Related Airdrops (Same Category)

Considers whether the project or similar initiatives in the same category had conducted prior airdrops, influencing user expectations and behavior.

Collateral Airdrops

Examines whether participants could qualify for additional airdrops while farming the main one, potentially amplifying user interest and engagement.

To address some of the more subjective aspects of airdrop dynamics, we conducted a survey involving over 150 airdrop farmers across Telegram and X. This approach allowed us to gather insights grounded in the real sentiment of participants, helping us better understand the following key questions:

• Was the airdrop well distributed among users?
• Did you farm the airdrop on purpose, or did you use the product because you needed it?
• Did you like the product/project?

By analyzing these metrics, we can conclude the effectiveness of airdrops in fostering positive mindshare and community engagement.

3. Data presentation

In this section, we present the collected data, organized into two categories: quantitative and qualitative. This dataset serves as the foundation for our analysis, showcasing measurable metrics that reflect platform activity and user behavior alongside insights into community sentiment and perceptions. By laying out the raw figures and observations, this section provides a clear view of the underlying trends and patterns that will inform our conclusions.

Quantitative Metrics

To extract relevant data, we have created custom charts for each metric in each category. These charts present the airdrop date as the central anchor on the X-axis, extending three months before and three months after the event. This design allows us to observe the behavior and trends surrounding each airdrop, both in the pre and post-TGE periods.

Layer 2 Solutions:

Active Daily Users: addresses that interacted at least 1 time that day. The data shown is relative to the DAU on the airdrop day.

Before the airdrop, DAU trends were steady or slightly increasing as users interacted with the network. On the airdrop day, all networks experience significant spikes in DAU, indicating heightened activity and user engagement.

Post-airdrop, user engagement drops significantly, especially for StarkNet followed by zkSync, reflecting a decline in activity once the incentive diminishes. Arbitrum experiences less volatility, suggesting more consistent user retention or engagement compared to the other projects.

Before the airdrop, Arbitrum was the only one maintaining an upward trend due to mere airdrop speculations, but the team didn’t announce it until one week before the claim, resulting in significant growth on the chart. The other two chains, however, were well-known to be launching an airdrop. Both had been in the farming process for about a year, and users farmed the airdrops for a long time but eventually got tired of waiting, abandoning the network and creating a spike in the claim to migrate their allocations to other chains.

This chart shows how, pre-TGE, the TVL of the projects remains relatively stable with slight increases, reflecting steady participation. Post-TGE, Starknet shows a sharp increase in TVL as users deposit funds into the network; Arbitrum also had an increase in TVL although much lower than Starknet. In contrast, zkSync has experienced a decline in TVL following its airdrop, maintaining a downward trend. These differences highlight the varying levels of capital inflow across the networks during this period.

As shown in the chart, Starknet’s TVL has experienced a significant surge. To understand this outcome, we analyzed on-chain data and found that the increase was driven by the rapid growth of Starknet’s leading protocol, Nostra. Following its TGE, Nostra’s TVL skyrocketed from $15M to $220M at its ATH just one month later, representing 68% of the network’s total TVL at that time. This growth was fueled by significant deposits from whales and the launch of DeFi markets for STRK, the token airdropped to protocols and users.

In Nostra, the top 30 wallets in the ETH market (currently holding $95M) control 68% of the supply, alongside other lending markets like STRK and USDC. This indicates that much of the TVL originated from a few large deposits, which drove aggressive growth post-TGE. These contributions have since helped stabilize the protocol and solidify its position as a key player in Starknet’s ecosystem.

Pre-TGE, netflows for Arbitrum and zkSync show fluctuations with notable inflow spikes, likely reflecting users preparing for the event, while Starknet remains relatively stable with smaller variations. Post-TGE, Arbitrum exhibits significant spikes in netflows, suggesting increased capital activity, whereas zkSync and Starknet display more consistent trends, indicating a steadier capital flow dynamic across these networks.

Perpetual Decentralized Exchanges (PerpDEX):

Open Interest (OI): daily open interest relative to the airdrop day.

Pre-airdrop, open interest trends show steady growth for Drift and Aevo, reflecting increased user positioning, while Jupiter exhibits moderate fluctuations. Post-airdrop, Drift maintains high open interest levels, indicating sustained market engagement, while Aevo shows a decline.

In contrast, Jupiter experiences a noticeable increase in open interest after the airdrop, reflecting growing user participation and confidence.

The sharp decline in Open Interest for Aevo observed after the airdrop is linked to the project’s decision to nerf its trading rewards campaign. Following the TGE, Aevo launched a 16-week rewards program, paying out incentives in AEVO tokens. This campaign led to significant wash trading, inflating both trading volumes and OI.

In response, Aevo nerfed the rewards structure to curb wash trading, which resulted in a noticeable drop in trading activity and, consequently, a sharp reduction in OI. While this adjustment aimed to address the unsustainable volume caused by excessive incentives, it had an immediate impact on engagement metrics and market participation.

Pre-airdrop, trading volumes for Drift display significant fluctuations with sharp spikes, suggesting speculative activity as users prepare for the airdrop. Aevo and Jupiter show more stable but gradually increasing trends.

Post-airdrop, Drift maintains heightened trading volumes with periods of volatility, while Jupiter demonstrates a sustained increase, highlighting ongoing activity. Aevo, however, stabilizes at lower levels, indicating reduced trading engagement.

Liquid Restaking Projects:

Total Value Locked (TVL): total value amount held in the chain excluding the native token value. The data shown is relative to the TVL on the airdrop day.

Pre-airdrop, both Etherfi and Renzo display notable uptrends in TVL as users allocate funds in anticipation of the event. Renzo’s increase reflects growing user interest alongside Etherfi’s more pronounced growth, while Puffer shows a slower and steadier rise in locked assets.

Post-airdrop, Etherfi maintains significant growth in TVL, driven by continued inflows. Renzo initially stabilizes with a slight uptrend before experiencing a decline over time. In contrast, Puffer sees a drop in TVL shortly after the TGE, indicating reduced user engagement or capital withdrawal.

Pre-airdrop, Etherfi shows significant volatility and growth in DAU, reflecting active user engagement leading up to the event. Renzo and Puffer maintain more stable and steady DAU trends with less fluctuation, indicating consistent but lower user interaction levels compared to Etherfi.

Post-airdrop, Puffer experiences a surge in attention with a sharp increase in DAU immediately after the event. However, this spike is short-lived, and DAU quickly declines to levels lower than before the airdrop.

Renzo, on the other hand, although it maintains a more stable trajectory with minimal fluctuations, shows lower activity post-airdrop compared to pre-airdrop levels, with some increase only appearing after about two months. Etherfi sees continued periodic spikes in DAU, though the intensity diminishes as time progresses.

Qualitative Metrics:

The following table summarizes the qualitative data collected from on-chain and off-chain data.

4. Conclusions

Using the quantitative and qualitative data, we can identify patterns and conclude the common characteristics of successful and unsuccessful airdrops within each vertical. These insights offer valuable lessons for future airdrop design and execution.

4.1. Layer 2 Solutions (L2)

Successful Airdrops: Arbitrum

Quantitative Insights:

DAU, TVL, and Netflows remained relatively stable or showed positive post-airdrop trajectories, indicating sustained user engagement and trust.

Qualitative Insights:

• First Airdrop of its Kind? No—Arbitrum was not the first airdrop of its kind but it was the second one after Optimism, meaning users had only some expectations and a baseline understanding of what to expect. Despite not being a novelty, the airdrop still succeeded due to other strong fundamentals.
• Airdrop Distribution: Well-distributed, ensuring users did not perceive it as heavily skewed.
• Costs and Complexity: Farming required neither significant time nor money, lowering participation barriers.
• PMF Achieved Pre-Airdrop: Yes—having product-market fit before distribution instilled confidence and made the airdrop feel like a genuine reward rather than an experimental gimmick.
• User Sentiment: Users genuinely liked the chain and its dApps, encouraging natural adoption rather than purely incentive-driven activity.

Conclusion:

Arbitrum’s success suggests that fair distribution, easy accessibility, prior PMF, and positive user sentiment can outweigh the novelty factor. Even as a non-first mover, Arbitrum leveraged an engaged community and strong fundamentals to ensure its airdrop led to sustained participation.

The strong investment of Arbitrum in grants led to the development of innovative products within its ecosystem, causing users to choose to stay on the network because there was real utility in the chain’s native products.

Less Successful Airdrops: Starknet and zkSync

Quantitative Insights:

zkSync and Starknet experienced a significant drop in DAU post-airdrop, but Starknet had an initial TVL spike followed by stagnation, indicating a lack of sustained engagement. As mentioned earlier, this TVL spike was mainly due to the incentives campaign ruled by Nostra Finance, which constituted 68% of the network’s total TVL and was led by new whale depositors.

Netflows remained steady but showed less significant spikes compared to Arbitrum.

Qualitative Insights:

• Airdrop Distribution: Poorly distributed, leaving users feeling that rewards were not fairly allocated.
• Farming Behavior: Users purposefully farmed the airdrop, often to qualify for just the rewards rather than out of genuine interest.
• Time and Monetary Costs: Although not high, there was a requirement to maintain liquidity for at least one month, adding friction.
• PMF and Sentiment: These projects did not achieve PMF before the drop, and users expressed dissatisfaction with the offering.
• Multiple Airdrops and Expectations: Neither zkSync nor Starknet’s were the first L2 airdrops so participants had prior benchmarks and may have been more critical. Additionally, users could potentially farm other related L2 airdrops at the same time, making both L2 offerings less unique and diluting their impact.

Conclusion:

Poor distribution and lack of product-market fit undermined zkSync’s and Starknet’s airdrop. High barriers like liquidity requirements discouraged casual users, resulting in diminished post-TGE engagement.

4.2. Perpetual Decentralized Exchanges (PerpDEX)

Successful Airdrops: Jupiter

Quantitative Insights:

Jupiter maintained and slightly increased its DAU post-airdrop, showcasing sustained engagement. Both OI and volume showed steady growth after the airdrop, reflecting increased trading activity and user confidence.

Qualitative Insights:

• Airdrop Distribution: Well-distributed among users, minimizing the sense that a small number of addresses dominated.
• First of Its Kind?: Jupiter’s airdrop was not the first in its category, but it was one of the firsts (if not the first) of the big Solana eco airdrops.
• Farming Complexity: Although it required time and money to participate, the user base consisted largely of organic users who needed the product’s functionality. This implies a correlation between utility-driven usage and positive reception.
• User Sentiment and PMF: Users liked Jupiter’s aggregator platform and its established product-market fit. This solid foundation converted recipients into long-term participants.
• Collateral Airdrops: Jupiter users gained access to other airdrops while farming Jupiter, potentially enhancing the overall user experience. Rather than diluting interest, these collateral opportunities may have created a synergistic effect, encouraging users to stay active longer.

Conclusion:

Jupiter demonstrates that even if not the first of its kind, a project that users truly value can thrive. The presence of collateral airdrops may have reinforced the community’s engagement. The key was meaningful utility and a well-liked product.

The Jupiter airdrop was launched at a favorable market moment when the Solana ecosystem was starting to grow rapidly, which helped the network’s largest project to ensure its token had a good price action.

Less Successful Airdrops: Aevo and Drift

Quantitative Insights:

Both platforms experienced a decline in DAU and volume post-airdrop, indicating reduced engagement and trading activity. The OI for Drift remained steady but lacked significant growth, while Aevo saw a decline.

Qualitative Insights:

• Distribution and Cost: Both were poorly distributed (though there isn’t much consensus on this in the case of Drift) and required users to spend more time and money to qualify, discouraging casual engagement.
• PMF and User Satisfaction: Neither had achieved PMF, and user sentiment was negative. Without a desirable product, incentives alone could not foster loyalty.
• First Airdrop Status & Collateral Opportunities: Although Drift was not the first of its kind, the lack of uniqueness and positive differentiation from previous PerpDEX airdrops hurt its reception. Aevo’s airdrop was also preceded by other similar efforts, making it feel less special. There were no meaningful collateral airdrops that could add value or keep users around.
• Collateral Airdrops: Users didn’t get any other airdrop because of farming Aevo or Drift.

Conclusion:

High barriers to entry, poor sentiment, and the absence of PMF combined to yield poor outcomes. In a crowded environment where multiple airdrops coexist, protocols must offer a competitive advantage and fair terms; otherwise, they risk losing out to more appealing competitors.

4.3. Liquid Restaking Tokens (LRT)

Successful Airdrops: Etherfi

Quantitative Insights:

showed continued growth in TVL post-airdrop, driven by consistent inflows and user trust. Similarly, DAU displayed periodic spikes, reflecting sustained interest.@Etherfi"">@Etherfi

Qualitative Insights:

• First Airdrop of Its Kind?: Etherfi’s was the first of its category, creating excitement and novelty value. Being a pioneer provided a distinctive advantage, drawing attention and encouraging early adoption.
• Distribution: Well-distributed and accessible, though it required some monetary investment and at least one month of liquidity provision.
• User Sentiment and PMF: Achieved PMF before airdrop, and users liked the project. This strong foundational appeal likely amplified the benefits of being the first mover.
• Collateral Airdrops: Users could obtain other airdrops while farming Etherfi, potentially enhancing their overall experience and perceived value of participation. This scenario turned multi-airdrop farming from a zero-sum competition into a positive-sum ecosystem, where Etherfi’s unique position and PMF made it a central part of the user’s strategy.

Conclusion:

Etherfi’s first-mover advantage, combined with fairness, PMF, and favorable user sentiment, led to a well-received airdrop. The novelty factor here complemented, rather than replaced, the underlying fundamentals. Collateral airdrop opportunities added to the ecosystem’s appeal rather than detracting from Etherfi’s own.

Cash”. The integration of its LRT with the largest protocols like Aave and Pendle, being the first LRT, helped gain the trust of large depositors.At that time, Etherfi was already offering different products that the competition did not provide like “Ether.fi

Less Successful Airdrops: Puffer and Renzo

Quantitative Insights:

Renzo’s TVL stabilized briefly before declining, while Puffer experienced a sharp drop post-airdrop. Both projects saw reduced DAU, indicating diminished user interest and engagement.

Qualitative Insights:

• Distribution and Engagement: Poorly distributed and requiring monetary lock deterred participants. The obligation to maintain liquidity for at least one month also increased friction.
• User Sentiment & PMF: While they had PMF (at least formally), users did not like the projects enough to stay engaged after rewards were claimed.
• First Airdrop or Not?: Neither was the first of its kind, reducing novelty. Without uniqueness or a strong reputation, their airdrops struggled to stand out.
• Collateral Airdrops: Although participants could access other airdrops while farming, this did not positively influence user retention. Unlike Etherfi, Renzo and Puffer did not offer compelling reasons to remain beyond the initial claim. Multi-airdrop farming in this context likely made these projects feel like stepping stones to better opportunities elsewhere, rather than destinations in their own right.

Conclusion:

Poor user sentiment, combined with high barriers to participation, lackluster engagement strategies and not being the first mover (as EtherFi was), hindered Renzo and Puffer’s success. Airdrops without strong community alignment or perceived value fail to achieve lasting impact. The airdrop-mania sentiment surrounding the LRTs and Eigenlayer seemed to have faded, and the delayed distribution of governance tokens from the projects led to poor price action. This decline in token prices post-TGE discouraged users from continuing to take allocation for future airdrops from both projects, with a clear winner emerging.

Key Takeaways Across Verticals

1. Novelty and First-Mover Advantage:Being the first airdrop of its kind (e.g., Etherfi) can create initial excitement, but without PMF and fair distribution, novelty alone does not guarantee lasting engagement. In established categories, novelty is less critical than strong fundamentals.
2. Multi-Airdrop Farming Dynamics:Offering or overlapping with additional airdrops can have mixed effects. When a project already enjoys strong user sentiment and PMF (like Etherfi or Jupiter), collateral airdrops can enhance the ecosystem’s attractiveness. However, in projects lacking these qualities (e.g., Starknet, Renzo, Puffer), multiple concurrent airdrops may simply compete for user attention, reducing loyalty and retention.
3. Fairness, Accessibility, and PMF Remain Core Drivers:Successful airdrops (Arbitrum, Jupiter, Etherfi) demonstrate fair token distribution, manageable participation requirements, and clear utility or PMF. These factors cultivate a sense of trust, keep users engaged long after the airdrop, and help the project stand out—even if they are not the first to launch a similar program.
4. User Sentiment and Engagement Patterns:When users like the project and perceive value (Jupiter, Etherfi), airdrops can catalyze sustained growth. When dissatisfaction or skepticism prevails (Drift, Aevo, Renzo, Puffer), airdrops become transient episodes of activity with no long-term benefits.

In conclusion, the success of an airdrop depends not only on the immediate incentive but also on the project’s broader ecosystem, fairness, user sentiment, and unique positioning. Whether or not a project is first-to-market or offers access to multiple simultaneous rewards is secondary to the fundamental drivers of long-term engagement: trust, perceived utility, and authentic community connection.

5. Final Reflections

Reflecting on the insights gained from both the quantitative and qualitative analyses, as well as the philosophical and psychological frameworks explored, it becomes clear that designing an effective airdrop strategy is not solely a matter of distributing tokens. Instead, it involves fostering a genuinely positive community sentiment (or “mindshare”) that endures long after the initial incentive has passed. As previous research suggests, the authenticity of the perceived “gift” (Pine, 2011; Reinstein, 2010), the unexpectedness of rewards (IZA World of Labor, 2022), and the sense of belonging and integration within the community (McMillan & Chavis, 1986) each play pivotal roles in shaping lasting user engagement and loyalty.

The projects that succeeded (be they L2 solutions, PerpDEXs, or Liquid Restaking protocols) demonstrated a clear pattern: they managed to align the airdrop’s intent with the community’s values, ensuring recipients felt valued rather than manipulated. In these instances, the airdrop served not just as a mechanism to attract capital, but also as an authentic gesture that deepened trust and strengthened the collective emotional connection. Whether it was Arbitrum’s community-friendly approach or Etherfi’s combination of novelty, product-market fit, and fair distribution, the unifying factor was the creation of a positive, sustainable mindshare around the project.

Such outcomes are consistent with the broader research on gift-giving and community psychology. Studies have shown that gifts perceived as genuine, rather than transactional, reinforce trust and encourage reciprocal engagement (Reinstein, 2010; Pine, 2011), mirroring the importance of aligning the airdrop’s purpose with user expectations. Similarly, a community’s shared emotional connection (McMillan & Chavis, 1986) and optimism about future growth (Messias, Yaish, & Livshits, 2023) can transform recipients from passive beneficiaries into active contributors, supporting long-term project resilience.

Yet, these findings lead us to a deeper and more philosophical question that underscores the delicate balance between sentiment and market realities: Is the price a reflection of the sentiment or is the sentiment a reflection of the price? In truth, the relationship between sentiment and price is cyclical and interdependent. Positive community sentiment can cultivate trust, spur utility-driven engagement, and thus contribute to strong market performance. At the same time, rising token prices can reinforce optimism and loyalty, feeding back into the community’s sense of purpose. This symbiotic loop suggests that neither price nor sentiment exists in isolation; each continually influences the other, shaping the trajectory of a project’s long-term success.

References

¹ McMillan, D. W., & Chavis, D. M. (1986).

² Messias, J., Yaish, A., & Livshits, B. (2023).

³ Pine, K. (2011).

⁴ Reinstein, D. (2010).

⁵ IZA World of Labor (2022).

⁶ Greenwood, R., & Shleifer, A. (2014).

⁷ Messias, J., Yaish, A., & Livshits, B. (2023).

Disclaimer:

1. This article is reprinted from [x]. All copyrights belong to the original author [@threesigmaxyz]. If there are objections to this reprint, please contact the Gate Learn team, and they will handle it promptly.
2. Liability Disclaimer: The views and opinions expressed in this article are solely those of the author and do not constitute investment advice.
3. The Gate Learn team translated the article into other languages. Copying, distributing, or plagiarizing the translated articles is prohibited unless mentioned.