Why Is EigenLayer Airdrop Receiving Backlash From Crypto Community?

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Key takeaways:

  • The EigenLayer token details were unveiled recently, including a 15% airdrop allocation for ecosystem participants. 
  • Criticism has emerged regarding the token’s lack of transferability and its restrictive measures 

The recent unveiling of the EigenLayer airdrop details has stirred a blend of reactions within the cryptocurrency community, ranging from applause to intense scrutiny. 

With plans to distribute 45% of its 1.67 billion tokens to the community, EigenLayer’s airdrop strategy includes an initial allocation of 5% for protocol stakeholders. 

However, the decision to impose restrictions on token transferability has raised widespread concern and debate.

Airdrops have been under heightened scrutiny by both authorities and the crypto community at large, with many instances of fraudulent activities being uncovered. 

 Just days ago, the DeFi Education Fund (DEF) took legal action against the U.S. Securities and Exchange Commission (SEC) over its stance on Beba, a Texas-based apparel company, challenging the SEC’s interpretation of Beba’s distribution of free BEBA crypto tokens.

Critics have particularly highlighted concerns over EigenLayer’s decision to initially make its tokens non-transferable, effectively preventing holders from selling or trading them until a future date. 

Additionally, EigenLayer has faced criticism for excluding users from seven major jurisdictions, including the United States and Canada, from participating in the airdrop, and for its linear allocation of tokens.

According to Eigen Foundation’s announcement, 15% of Eigen’s token supply is designated for its community, with 5% allocated to points holders from the first season of the airdrop campaign. 

Why Is Eigenlayer Airdrop Receiving Backlash From Crypto Community?

                                    ((source: eigenfoundation))

What distinguishes EigenLayer’s airdrop is its stakedrop nature, wherein the EIGEN tokens cannot be transferred initially, limiting their liquidity until integration with EigenLayer’s proof-of-concept/proof-of-value data availability service, EigenDA.

Despite being founded by Sreeram Kannan, a former data science professor at the University of Washington, and boasting a total value locked at $15.7 billion, EigenLayer’s airdrop plan has faced significant backlash. 

Concerns over the exclusion of certain jurisdictions, short vesting schedules, and linear distributions favoring well-capitalized stakeholders have fueled the debate.

Furthermore, the decision to exclude users from the U.S., Canada, and China, among others, from the airdrop has drawn sharp criticism for its perceived unfairness. 

While EigenLayer’s growth has been propelled by the promise of an airdrop aligned with its points program, the recent controversies have highlighted broader issues within the crypto industry regarding transparency, inclusivity, and regulatory compliance.

As EigenLayer navigates these challenges, the crypto community awaits further developments, with stakeholders and observers closely monitoring how the project addresses the concerns raised and maintains trust and credibility in its operations.

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Aadrika Sharma
Aadrika Sharma

I enjoy writing and try to learn new things every passing day!

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