It’s been a while since I talked about airdrops. A few days ago, I saw some friends discussing Grass’s airdrop, but it seems that Grass’s airdrop did not bring any new hot spots to the market. Instead, most people complained that the number of airdrop tokens they found was too small.
According to information released by Grass, the total supply of GRASS tokens is 1 billion, of which 10% is for the first airdrop, including 1.5% for the Alpha test season, 7% for seasons 1-7, 0.5% for the reward season (currently in progress), and 1% to be announced. At present, the floor price of Grass points listed on the Whales Market is about $0.00015 per point. As shown in the figure below.
Probably influenced by a lot of negative comments, a few days after the announcement of the airdrop information, the Grass Foundation issued a message through X saying that they are fine-tuning the airdrop query system to reduce false positives, which means that the token amount displayed on the airdrop check page is not the final result. As shown in the figure below.
But this does not seem to stop people from continuing to complain. According to some analysts' estimates, the price of GRASS tokens after listing may be between 0.2 and 0.5 US dollars. According to some feedback from the Internet, most users' query results for airdrop tokens are concentrated between 10 and 100. Even if calculated at 0.5 US dollars, it is equivalent to an airdrop reward of 5 to 50 US dollars, which is a real pig's trotter meal.
In addition to the Grass airdrop mentioned above, I have also seen some friends in the group posting some related airdrop information based on the Fractal Bitcoin (FB) protocol in the past two days. This is a new protocol that was launched on the mainnet two days ago (September 9). Fractal Bitcoin, also known as fractal Bitcoin, is a Bitcoin-based expansion solution. The total supply of FB tokens is 210 million, of which 50% is allocated to PoW (ordinary users can also participate, and the main way to participate is through machine computing power mining or purchasing BitTera's NFT), and the rest is allocated to core contributors, ecosystem vaults, communities, consultants and pre-sales. As shown in the figure below.
Additional knowledge: What is a fractal? What is the difference between a fractal and Layer2?
Fractal refers to gradually expanding the Bitcoin blockchain by adding a fractal layer to the Bitcoin main chain, transforming it into a scalable computing system while maintaining full consistency with the Bitcoin main chain. The Fractal Bitcoin protocol we mentioned above expands the network by adding a fractal layer to the Bitcoin main chain. The fractal layer allows the Bitcoin network to process more transactions without changing the original code, maintaining compatibility and security with the main chain.
To give a simple example, if we compare Bitcoin to a big tree, then the trunk of the tree is the Bitcoin main chain, and the branches and leaves represent the fractal layer. Fractal Bitcoin adds these "branches" to the Bitcoin main chain, which can process transactions independently but remain closely connected to the trunk, allowing the entire system to expand faster and more efficiently.
In contrast, the traditional Layer2 is an independent network built on the Bitcoin main chain, like an additional channel. Although this can also speed up transactions, it is usually more complicated to use and may require cross-chain.
In other words, Fractals will not compete with the Bitcoin mainnet for liquidity.
Although Fractal Bitcoin has only been online for less than 3 days, it has already attracted some attention. In addition to the airdrop of FB tokens, some new projects based on the Fractal Bitcoin protocol have also announced related airdrops. For example, on the day when Fractal Bitcoin was launched, the FLUX protocol was launched. The cost of printing an inscription was 0.05 FB, and the total number of inscriptions was 21,000, which was sold out in half an hour. Then, today, Cat Protocol took over again...
Of course, we just briefly mentioned the airdrops of Grass and Fractal Bitcoin above. Today, we will not talk about too many specific projects. We mainly want to have some new thoughts on the airdrop!
Whenever airdrops are mentioned, many old investors may miss the early airdrop projects, because participating in airdrops seemed to be a relatively simple and effective thing at that time. But since Friendtech started using the points method in August last year, point airdrops seem to have become a main theme of airdrops, and then more and more projects have launched point systems (such as using XP or other synonyms for annotation). It seems that overnight, everyone has started to brush points for various projects. In the past year or so, there have indeed been many hot spots and concerns.
But the law of development of all things is actually the same. When people flock to a field, a bubble will inevitably form in that field, and then when the bubble reaches a certain level, it will burst. So we can also find that for a period of time, the airdrop field does seem to be dead.
But if we think from another perspective, the current deadlock may not be a bad thing. Because in my opinion, whether it is airdrops or transactions, the key to many things is actually the choice of timing.
How do you understand this?
The trading aspect should be relatively easy to understand. This is also the core idea we have always adopted. In simple terms, the best deal is definitely to buy when no one is interested and sell when there is a lot of noise. In comparison, our own execution strategy is to insist on regular buying in a bear market and wait until the bull market to sell in batches.
The same is true for airdrops. If airdrops are extremely popular and everyone is trying to get them, then the chances are relatively rare and competitive. If we can make the necessary preparations in advance when others are paying little attention, then the corresponding chances will definitely be greater.
So, how can we seize such an opportunity?
We believe that there are two core points to consider: one is to pay attention to changes in TVL, and the other is to think about the issue of friction costs.
1. Pay attention to changes in TVL
Let’s take a simple example here. Before December last year, Solana had not attracted everyone’s attention. As its TVL grew from around US$200 million at the beginning of the year to US$1 billion, projects such as JTO (airdrop in December 2023) and JUP (airdrop in January 2024) also carried out airdrops during that period and generated sustained popularity. Those users who participated in it relatively early should have made good gains at the time.
Subsequently, Solana's TVL further increased rapidly, and both token prices and ecological projects took off. However, as its TVL reached a high of US$49 billion, subsequent airdrop projects such as KMNO (airdrop in April 2024), PRCL (airdrop in April 2024), CLOUD (airdrop in July 2024), etc. did not seem to produce much wealth effect, and the limelight quickly passed.
Therefore, those who can really get good airdrop returns are often those who can participate in the early stage (lower TVL in the early stage, early airdrop projects). As TVL continues to rise (when it rises to a certain stage, outflows are bound to occur), the chances of making profits from subsequent airdrop projects will actually become smaller and smaller, because the money-making effect of the ecosystem (chain) has been overdrawn at this time.
So, is the airdrop really dead for now? Is there no chance anymore?
That's not necessarily the case.
It’s just that we may need to find some new alternatives or opportunities. For example, if we look at the current Bitcoin ecosystem from the perspective of development history, isn’t it very similar to the early Solana chain with a lower TVL? Although the Bitcoin ecosystem may not 100% usher in its own airdrop season in the future, it at least seems to have a certain chance.
2. Think about the issue of friction costs
The friction cost here refers not only to the time cost or money cost you pay for the airdrop project, but more to the thinking or learning cost, that is, the threshold cost for many new users.
For those who have participated in some Dapp airdrop interactions on the Ethereum or Solana chains, it should be easy to understand that participating in airdrop interactions on these chains is actually quite simple. For example, you can directly use bridge assets such as Orbiter and Debridge, and then use wallets such as MetaMask and Phantom to interact, trade, pledge, and other activities to obtain airdrop points.
But in the Bitcoin ecosystem (network), the friction cost seems to be higher for many new users. For example, you may first need to understand which wallet address you need to use, whether it is a P2PKH address starting with "1", a P2WPKH address starting with "bc1" or "tb1" (native segregated witness address), or a Taproot address or Lightning... Then link different wallets and understand UTXO transfers (for example, after understanding the UTXO model, you will understand why there is still BTC in the wallet but the balance is insufficient).
This is one of the reasons why relatively few people played when BRC-20 first appeared last year, because there was friction cost. When some BRC-20 tokens were listed on exchanges such as Binance, or could be purchased directly through wallets such as OKX, that is, when the friction cost became small enough, more people participated, but the wealth opportunities became smaller.
The same goes for airdrops. More friction costs mean fewer people participating, which means the opportunity to make money has not been completely diluted.
3. Let’s briefly talk about the opportunities of Bitcoin ecology
After understanding the above two points, it should not be difficult for us to understand the possible opportunities of the Bitcoin ecosystem mentioned above (of course, it can also be applied to other ecosystems for understanding).
As concepts such as inscriptions ignited the popularity of the Bitcoin ecosystem last year, many early users who participated in the ecosystem did get good opportunities. Although the popularity of the Bitcoin ecosystem is not as high as before, just like the airdrop concept, there are even many old investors who believe that Bitcoin does not need an ecosystem at all.
But if we only look at it from the perspective of project development, there are indeed many projects under construction in the Bitcoin ecosystem, and this is also one of the biggest narratives of this bull market so far. At least in the past two bull markets (2017 and 2021), I have not seen the Bitcoin ecosystem have so many supporting projects and relatively complete infrastructure as it does now. As shown in the figure below.
Therefore, from the perspective of airdrops, the current TVL of the Bitcoin ecosystem is not high, and there are still friction costs. Perhaps there are some possible new opportunities here.
For example, due to the price problem of BTC itself (including the Gas problem), you may even find that few people seem to participate in some LSD protocols, Bridge protocols, and unissued protocols that have received VC financing on the Bitcoin chain like Ethereum/Solana (or relatively few users participate), which is actually a kind of friction cost. Once the market can usher in a new turning point, such as a hot airdrop event or the market trend turns good again, some projects should soon usher in a round of reversal and attract more newcomers to start pouring in, and the corresponding friction cost will continue to decrease.
The same script may continue to be played on a different stage. It depends on how the director and the leading actors perform together. For example, the Solana craze mainly started with airdrops (JTO, JUP and other DeFi-based airdrops), and then slowly turned to the hype of MemeCoin with the growth of TVL. Such a story may continue to be played on other chains, and the Bitcoin ecosystem seems to be one of the good potential stages.
When most people are not paying attention, it is actually the best time for you to look for opportunities. No matter what, if you still hope to gain something from trading or airdrops, then without affecting your job and main energy, it is probably right to take a small part of your time to explore more opportunities in the Bitcoin ecosystem. Even if you decide to start studying the Bitcoin ecosystem now, it is not too late.
Of course, one of the major prerequisites for these things is that you must first have BTC. If you have heard from others in recent days that BTC will fall below 40,000 next, and you want to continue to wait, then you can continue to wait, this is your personal freedom. Otherwise, you can make necessary plans according to your own position situation, such as taking out a part of the position to buy a little BTC in batches, so that you can use it at any time to carry out some activities in the Bitcoin ecosystem (such as participating in liquidity mining or airdrops). Or, if you are not very interested in airdrops and are only interested in trading, you can also take out a little position to buy projects with better fundamentals and carry out some DCA buying operations.
But whether it is an airdrop or a trading activity, the security issues involved are actually a kind of friction cost. When conducting interactive activities such as liquidity mining/staking, try to avoid participating in low-security protocols to avoid the project owner running away or the wallet being stolen.
This is where we share the content for this issue. You can view more articles on the homepage of Hualihuawai.
Disclaimer: The above content is only a personal point of view and analysis, and is only used for learning records and communication, and does not constitute any investment advice. The encryption field is an extremely high-risk market. In addition to various forms of phishing attacks and pig-killing schemes, many projects also have the risk of returning to zero at any time. Please treat it rationally, do not touch it if you do not understand it, and be responsible for yourself.
