Ultra Sound Responsibility - The Daily Gwei #380
Are you feeling responsible, punk?
There’s been a new meme circulating around crypto twitter lately that’s based on a tweet that Brantly (ENS team member) put out the other day which said “you weren’t just airdropped money; you were airdropped responsibility”. Now obviously this is in reference to the recent ENS token airdrop and it’s easy to see why this became a meme. Though, outside of the humor, I think the meme tries to convey a deeper message that I wanted to explore today.
I’m sure it’s obvious to all of us that many people will simply sell their airdropped tokens within a very short time of receiving them - and why wouldn’t they? The value of these airdrops can range from a few thousand dollars all the way up to 6 figures (and sometimes even into the millions)! These airdrops are life-changing for many people because some of them end up being worth more money than many people make in a year. So looking at it from this point of view, no one should ever be shamed for selling an airdrop - if the project didn’t want recipients to sell it then there are mechanisms that can be put in place to prevent selling (vesting is an obvious one).
I still believe airdrops (when done properly) are one of the best and fairest ways to distribute tokens to a wide set of people. Yes, a very high percentage of these people will end up selling within a short period of time, but those who hold onto their tokens are the true believers of the project and now have real agency in its direction without having to buy the tokens themselves (while still having skin in the game). These airdropped tokens are also normally given to the early supporters of a project which increases the likelihood of them holding the tokens versus if a project was to distribute tokens via an extremely speculative token sale.
Another factor to consider is that most people will simply not participate in governance no matter what a project does - they will either delegate their vote to someone or just speculate on the token. This is the reality that all DAOs need to be designing for and I’ve actually been encouraged lately to see DAOs strongly embracing the delegate model instead of just letting governance turn into a disorganized mess. Though, in saying that, the delegate model is not a perfect system - it is simply the least worst one we currently have - so DAOs should remain acutely aware of this else they risk becoming captured by special interests.
I do hope that projects/DAOs keep experimenting with different token distribution and governance models because we haven’t even scratched the surface of what is possible. To do this, there really does need to be a sense of responsibility by at least some token holders to steward the DAO or it is basically guaranteed to turn into something governed by a cartel (who will most likely just loot the treasury). So let’s all take some responsibility and make sure that we keep experimenting - it is the lifeblood of Ethereum after all.
Have a great day everyone,
Anthony Sassano
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All information presented above is for educational purposes only and should not be taken as investment advice.