EigenLayer airdrop draws criticism amidst transferability concerns, allocations

The details of the EigenLayer airdrop were finally unveiled, drawing both applause and significant scrutiny.

The launch plan includes allocating 45% of the 1.67 billion tokens to the community, with a third of this portion distributed through an airdrop spanning multiple seasons. The initial season will distribute 5% of the tokens in two segments, specifically rewarding those staked with the protocol.

A primary concern is the restriction on token transferability upon release.

“When the token is launched, it will be non-transferable for months,” EigenLayer explained, aiming to allow time for decentralization and build consensus on its utility and governance.

However, this limitation and the allocation of the tokens have sparked discontent, particularly among recipients of the airdrop.

“A total supply of 15% committed towards community airdrops is a full 50% above industry standard – so I don’t think ‘they’re not thinking of the community’ criticism is valid,” David Hoffman, Co-Owner at Bankless, said on X, highlighting the disparity.

The issue mirrors the controversy surrounding the Starknet airdrop in February. Tokens for investors and core contributors were initially set to be unlocked shortly after trading commenced, following a year-long vesting period that had elapsed in the background. Starknet postponed these unlocks after facing backlash.

Further criticism arose from the airdrop’s exclusion of certain countries, including the U.S. and Canada, and its block on VPN users, ostensibly due to regulatory concerns. This selective eligibility has frustrated some users, who noted inconsistencies in platform access versus airdrop participation.

Additionally, the complexity of the airdrop’s structure and its underlying concepts, such as intersubjective forking described in the whitepaper as part of the Universal Intersubjective Work Token, have been disputed.

Confusion also surfaced regarding the eligibility of Pendle users, who were initially thought to be excluded from the airdrop. The Eigen Foundation later clarified the inclusion, although Pendle’s market response remained lukewarm, with an 18% drop since the announcement, according to CoinGecko.

Many believe that the EigenLayer criticism is why Ethereum (ETH) is in the red today. The platform has experienced a significant surge in withdrawals, with around 150,000 ETH; the equivalent of $457 million has been removed, as reported by Dune Analytics and DefiLlama.