EigenLayer’s Airdrop Rules Face Community Backlash

The team behind the restaking protocol EigenLayer has unveiled details regarding the launch and distribution of the EIGEN token. However, market participants have reacted negatively to the information about the lengthy vesting period and regional restrictions.

According to the tokenomics, 45% of the 1.67 billion coins will be allocated to the community. One-third of this amount is earmarked for an airdrop to staking participants.

The main criticism pertains to the holding period of the coins—after claiming, EIGEN cannot be moved, and the monthly unlock rate is a mere 5%.

So EigenLayer team and investors are getting 55% but stakers are getting only 5% and even that will not be transferable at the beginning.

The amount of greed crypto developers and VCs are exhibiting just keeps suprising me every time..

— CoinMamba (@coinmamba) April 29, 2024

“Thus, the EigenLayer team and investors receive 55%, but stakeholders only 5%, and even without the right to move them initially. The level of greed among crypto developers and venture capitalists surprises me every time,” wrote trader CoinMamba.

The project’s regional policy also raised concerns. The platform’s team decided to exclude users from the US, Canada, Russia, China, and several other countries from the distribution, and warned of blocks for using VPN services.

They let people from all over the world to deposit ETH but blocked them from claiming rewards. WTH!

— MichaelBarreto.ETH ? ? $MON ? $LOL (@mykelbarreto) April 30, 2024

“They allowed people from all over the world to deposit ETH but prohibited them from claiming rewards. What the hell?” trader Michael Barreto fumed.

Apewood described the technical document, which outlines a “universal intersubjective token” and concepts like “intersubjective branching,” as overly complex for the average user.

Kind of poetic how people were writing threads how memes are bad for crypto etc etc

Then boom eigenlayer launches with a whitepaper the average person can’t understand, tokenomics heavily skewed towards VC away from community, blocking VPN…

This is why people flock to memes

— apewood (@apewoodx) April 29, 2024

“It’s somewhat poetic that people were writing about the harm of meme tokens for the crypto market and so on. Then EigenLayer launches with a technical document that the average person can’t understand, and tokenomics heavily skewed towards venture capital, away from the community. This is why people flock to memes,” he stated.

There was also confusion regarding Pendle users’ eligibility for the distribution. Ultimately, EigenLayer representatives clarified that users depositing coins through this platform would indeed receive a portion of the airdrop.

Amid the negative reaction, there was a significant surge in asset withdrawals from the restaking service. According to the Dune dashboard, over 7,000 withdrawal requests were initiated within a day.

Back in April, the project team launched the main restaking platform and the beta version of the EigenDA data availability layer on the Ethereum mainnet.

Despite the service’s high popularity, DEX developer 3Jane, known as Chudnov, warned of a potential yield crisis for EigenLayer.