Eigenlayer Stakedrop Faces Criticism Over Token Restrictions and Geographic Barriers
Summary:
Eigenlayer, the second-largest protocol with a total value locked (TVL) of $15.67 billion, comes under fire from users over non-transferable tokens, stringent geographical restrictions, and short snapshot period linked to their recent stakedrop. Despite the criticism, some defend Eigenlayer's approach, considering the user token allocation as "generous" and the linear stakedrop as the "fairest way" to conduct it.
The recent Eigenlayer stakedrop has come under fire as users pointed to several issues including non-transferable tokens, stringent geographical restrictions, and a short snapshot period. Eigenlayer, which is the second largest protocol boasting a total value locked (TVL) of $15.67 billion, revealed the details of their much-anticipated stakedrop on April 29. While no airdrop had been officially disclosed until Monday, speculators added a whopping $15.7 billion to the protocol since its launch, in hopes of benefitting from a future airdrop. According to Eigen Foundation, a 15% echelon of EIGEN's total 1.67 billion tokens supply would be earmarked for the community with 5% specifically for early Season One participants. The remainder would be doled out during future 'seasons'. Some users bemoaned the relatively small allocation and criticised the obscure allocation documents. Frustration was majorly directed at the inability to transfer or sell their tokens until an unspecified date, starting March 10. The Foundation clarified that this regulation was to ensure essential features like payments and slashing parameters were firmly in place before making EIGEN transferable. Furthermore, EIGEN's linear distribution model, which ties the amount of EIGEN tokens users can claim to the number of points they earn, was said to give undue advantage to large restakers. However, other protocols like Kamino Finance and Parcl have also used the same model. Stringent geographic restrictions also elicited criticism, wherein users from countries like the US, Canada, China, and Russia are not allowed to claim tokens. Eigenlayer's harsh geoblocking efforts were criticised by users who were unable to bypass the restrictions even with VPNs. Despite the outrage, Henrik Andersson, the chief investment officer of Apollo Capital, defended Eigenlayer claiming that critics were searching for reasons to be disgruntled. Andersson praised Eigenlayer's 15% user allocation as "generous" and attributed some of the confusion to misconceptions about allocations to certain DeFi protocol users. He lauded the linear stakedrop as the "fairest way" to conduct it and appreciated the fact users do not need to connect their wallet or sign anything to check their stakedrop.
Published At
4/30/2024 6:00:55 AM
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