For many, airdrops have proved profitable. However, projects are already abusing the process since they have realised how growth-hacking may be achieved and because "points" are a recent trend. The developers are aware that we are aware of their expertise, and they are aware that we are aware of their expertise. These days, points are essentially just gambling and are exploitative and lazy.

A Brief history of Incentivize Crypto Adoption

It's crucial to comprehend the history of concepts in order to comprehend them.

Compound was the first to pioneer liquidity mining, which sparked the 2020 "DeFi Summer." Compound tokens were used as incentives for lending and borrowing. Twelve projects soon followed, each with a unique variation on the incentives. One of them, Sushiswap, used its own token, SUSHI, to reward liquidity provisioning (LP) positions in an attempt to "vampire attack" Uniswap, which had not yet introduced a governance token. This put pressure on Uniswap to introduce UNI, which it did with an airdrop for early adopters that was retroactive. (As it was larger than a COVID stimulus check, others quipped that it was the "stimulus for Ethereum.")

Decentralised finance was greatly aided by the UNI airdrop's broad reach, which attracted a large number of new customers. Since then, numerous protocols on numerous chains have duplicated this similar airdropping of tokens, albeit with differing degrees of uniqueness.

Then, in 2022, Blur emerged as the points pioneer. By trading non-fungible tokens (NFTs) on its marketplace, users might accrue points. Real consumption could be prioritised over farming by maintaining the ambiguity of the income criteria. Blur's phenomenal popularity meant that soon every project had a points system in place.

There is a widespread misperception that DeFi points are an advancement over loyalty points that are offered by hotels, airlines, and cafés. It does not follow that "points" are the same thing in DeFi initiatives and cafés. They belong to different taxonomies because of their significant historical and usage variances. A low-risk loyalty programme is one; the other purposefully uses hype to inflate metrics and generate fees.

Points for today

Predatory is the current point meta. There is no set time limit, no prize, and modifications are subject to alter at any time. Some refer to rewards as "forever points" because they can never be redeemed for valuable tokens, or they could have no worth at all. It is always possible to shift the goalposts back. Users who pay actual fees and opportunity costs bear the cost of all of this.

Projects are running wild with false advertising, promoting black boxes in a world where transparency should be paramount. And they're pushing things beyond what the pioneers did. Blur launched their token within five months, but there are projects now that have been milking their users for over a year now.

Way ahead

Moving forward with points necessitates a dedication to openness and equity. Projects that are upfront can fulfil the promise of transparent, decentralised finance instead of creating the very mechanisms that we were initially critical of. We can turn points from a speculative wager into a practical tool for engagement, retention, and incentives by placing an emphasis on ethics. as it ought to be.