The Path of Least Resistance

Crypto is a VERY unique industry - it’s the only one in the world where giving away “free" money is normalized and an obligation that founders feel pressured to pursue.

Like my old boss, Charlie Rogers, used to tell me,

“There is nothing harder in crypto than giving away free money, it will never be enough.”

I will say, the use of the words “free money” is up for debate. Effort comes in all shapes and sizes and tends to be subjective.

Every airdrop is different - some reward purely based on social signals, some reward purely based on onchain signals, but all of them are an attempt to align expectations with happiness.

The equation, Expectations - Reality = Happiness, is the definitive way to measure the success of an airdrop. How much effort was traded for a certain $$$ of tokens? Did it align with the expectations of your farmers?

Did you ask your community to post a tweet every single day to earn points and turn around and give them nothing? Expectations exceeded reality, you lose.

Did you ask your community to deposit thousands of dollars into your protocol for months, not make the expectations clear about your airdrop criteria, then turn around and give those users $5 worth of tokens because they weren’t active on socials? Again, expectations exceeded reality, you lose.

I want to make something VERY clear here, there has been a long winded debate sparked by a tweet I made that I am “against farmers”. This couldn’t be further from the truth.

I am against bad incentives, and the consequences they create.
Translation: I don’t hate the player, I hate the game.

Airdrop farming is human nature. It’s a task fueled by the combination of incentives, crowd mentality, and culture.

We can draw a lot of comparisons to airdrop farming from desired paths:

The path of least resistance.

It’s Billy Bob’s first day as the GTM lead for a new, exciting prediction market crypto app.

He’s nervous, but he’s done plenty of work in the Web2 world growing sports betting apps, so he’s confident in his abilities.

Being a crypto app, of course they’re going to have a token.

From the outside looking in - tokens are great marketing tools, incentives for hiring, and a way to get people excited for the project pre-TGE.

His core KPIs?

Sitting at his desk for the first time, Billy does research into automated ways he can drive engagement and signups. After all - if he can offload most of his job to automation, he can spend less time working!

He comes across a couple of tools that provide guaranteed results, Galxe, Zealy, questing platforms that have a proven track record of driving numbers.

Billy knows if he is able to knock these KPIs out of the park, he can not only keep his job but climb the ranks, using these numbers as proof.

Instead of taking the path of Web2 growth: talking to real customers, running real incentive programs, finding real product-market-fit, he takes the desired path of automation and pumping the numbers.

He pays a questing platform $10k a month to spin up automated quests - some having users follow their X account, some having users join the Discord, and some even having users make an account and do some trades on Billy’s platform.

To Billy’s surprise - within a week, he has hit his KPI’s for the next 6 months. Wow!

Billy continues to use quests and points to drive engagement, using it as the sole growth mechanism for his project. Everyone is happy.

What Billy doesn’t know is that he has created a monster.

On the other side of Billy’s impressive numbers, an army of speculative airdrop farmers are completing quests daily, some users even spawning entire bot/sybil armies to farm points on Billy’s Galxe page.

After all, why shouldn’t they?

Questing platforms are solely for the purpose of farming airdrops, if a user can go to the quests, complete a couple daily, and get a paycheck later down the line, why wouldn’t they do this?

And everyone in crypto knows that points = airdrops.

Unfortunately for Billy, the monster he created only gets bigger day by day. The longer these bad incentives continue to fuel his “growth”, the more damage is going to be done to his TGE, his brand, and his legacy.

Tl;DR: TGE comes around, airdrop gets distributed and diluted across millions of wallets, token goes to zero, trading revenue goes to zero, project gets fudded into the ground, Billy now lives under a bridge.

It’s the fault of the path of least resistance.

Billy chose to take shortcuts, farmers did what any human would do and took advantage of those shortcuts, Billy paid the price when payday came around for the farmers.

He created a bad incentive, and everyone suffered.

Bad incentives are a consequence of the path of least resistance.

Like I said earlier in this article, crypto is a unique industry. It has one other massive problem that founders try to solve with bad incentives:

Lack of demand.

The truth is, most crypto products don’t have product-market-fit.

So what does a project with no product-market-fit do to get users?

Take the path of least resistance with bad incentives to purchase engagement to create a false sense of “hype” for their generic Aave fork on a ghostchain.

Airdrop farmers are the victims.

Farmers, real users, and everyone else under the sun are subject to whatever incentives and promises are presented to them.

They want to make money → a project presents them with a way to make money → they do the thing → they may or may not get money, it’s the game.

Which would be totally fine if it was a simple exchange, but I’ve seen quests and point systems go on for YEARS on end.

Projects leading on their communities, making false promises, juicing every last bit of engagement they can out of the people that trust them.

It’s a terrible system for both parties, nobody benefits other than the founders that will likely cash out at TGE, leaving their teams and communities holding the bag.

All of this to say - project founders: instead of yelling at farmers, sybils, etc on X dot com, look inwards at your incentive system and make better designs.

Contrary to popular belief, you CAN grow a project without lame, terrible incentives. You just need to be creative.

Do more than the path of least resistance. (also stop building random stuff that doesn’t have PMF thanks bye)