Uniswap introduced a new concept – retroactive airdrops. Since then it has become a trend which almost all DeFi protocols now use to broaden token distribution. Airdrops serve as a distribution mechanism generally used to launch a new token and bootstrap the network effect. All of this sounds great, after all, what could go wrong?
BTC and El Salvador
One of the biggest pieces of news this year was when the Legislative Assembly of El Salvador passed the Bitcoin Law on June 8, 2021, making the cryptocurrency bitcoin legal cash in El Salvador after September 7, 2021. President Nayib Bukele had proposed it. While this is certainly a win for the bitcoin community, the BTC redemption via Chivo wallet wasn't that smooth. People who discovered their wallets had been activated without their knowledge have swamped the Chivo wallet helpline. Scammers had already gotten their hands on the $30 bitcoin sign-up incentive. But, more crucially, this creates a security concern for future bitcoin wallet use. Due to the fact that each citizen may only activate one wallet, they are effectively stuck with the wallets that the scammers have already gained access to. Putting money in these wallets is a big risk since scammers may quickly get into them and take whatever money the user has in their Chivo wallet. Tatiana Marroquin, an El Salvadorian economist, downloaded the wallet for the first time only to discover that it had already been activated by someone else. Marroquin said on Twitter that she had never downloaded the wallet before but had been motivated to do so after seeing multiple citizen complaints about their wallets being activated by crooks. According to social media complaints, a big portion of the estimated 52% of registered customers were scammers who impersonated consumers' details in order to collect the $30 bitcoin incentive.
Ribbon and Divergence Ventures
Then there’s the drama around Ribbon and Divergence Ventures. Divergence Ventures admitted on October 9th that they had crossed a line by sybil-ing the $RBN airdrop. Divergence team further explained: "We are TINY investors in Ribbon - $25k in a round from January. We had NO insider information. We simply guessed there would be an airdrop." Still, everyone can observe from the public ledger that there was an attempt to private farm and dump on retail. Despite the fact that the VC fund returned 702 ETH to Ribbon DAO, the intention was to sybil a retroactive airdrop into a portfolio firm. This particular incident demonstrates that some of their wallets are discovered, but what about the others are not called out? The end outcome is always the same, and it is still driven by money. Overall, this was an unpleasant circumstance for all parties involved – a lesson in ethics and responsible disclosure for subsequent crypto startups and investors.
If only there was a way to program "one person, one allocation" into the system, everyone involved in the project would be treated fairly.
Humanode allows investors to be identified without having to share any raw biometric information in order to create a unique human identity. In other words, crypto projects can be assured that each wallet account belongs to a unique holder. The Humanode protocol employs a search-and-match algorithm to demonstrate the participants' humanity and uniqueness. With the application of cutting-edge liveness detection, validated participants can be proven to be distinct and human. Based on the “one human, one allocation” premise, Humanode will ensure a fair distribution of tokens to everybody eligible for the retroactive airdrop campaign.