You touch on something quite interesting, which is how to measure the return on spending if you are paying out native tokens that were "created out of thin air"?
On Web2, return on ad spending is quite straightforward, which is just dollars (or any other currency) spent by the user against ad costs (again, in dollars). But protocols are akin to Central Banks, as they print the currency their economy is based on and give out those tokens as rewards. Return on ad-spending get much wackier here and there's no standardised way of calculating it (yet).
I'd recommend you take a look at the guys over at https://blog.spindl.xyz/, they have some very interesting articles on the matter.
They did and I actually think that Optimism had a very well thought out airdrop. But token incentives can only get you so far, and for one reason or another Arbitrum has been the clear winner thus far among the optimistic rollups.
If Blur had run a similar incentives program but their product had been subpar, they would not have had the same success.
It is, but if as a protocol you get users to do something useful for you, wether they are sybilling becomes less important.
Plus, in the case of Blur, those farming are taking risk, as their bids can be hit and they can be stuck with inventory that they didn't necessarily want. Haven't run the numbers (maybe we do in the future) but it would not surprise me if quite a few users trying to farm Blur actually lost money in the end because the rewards didn't compensate for the ETH they "lost" when their bids got hit.
Well yeah, that's true that some of them, especially those who don't read guides from other sybillers, lose some money. But almost all work here is done by bots.
I, personally, like the HFT way more. Where you farmed with size and got tokens proportionally. So those who really help with liquidity are getting rewarded.
Do we know if the cost of some suggested strategies is lower/ the same as doing a one time drop?
You touch on something quite interesting, which is how to measure the return on spending if you are paying out native tokens that were "created out of thin air"?
On Web2, return on ad spending is quite straightforward, which is just dollars (or any other currency) spent by the user against ad costs (again, in dollars). But protocols are akin to Central Banks, as they print the currency their economy is based on and give out those tokens as rewards. Return on ad-spending get much wackier here and there's no standardised way of calculating it (yet).
I'd recommend you take a look at the guys over at https://blog.spindl.xyz/, they have some very interesting articles on the matter.
Optimism implemented continued airdrop for users, and seems as better examples than Blur
They did and I actually think that Optimism had a very well thought out airdrop. But token incentives can only get you so far, and for one reason or another Arbitrum has been the clear winner thus far among the optimistic rollups.
If Blur had run a similar incentives program but their product had been subpar, they would not have had the same success.
but blur is being sybilled anyway
It is, but if as a protocol you get users to do something useful for you, wether they are sybilling becomes less important.
Plus, in the case of Blur, those farming are taking risk, as their bids can be hit and they can be stuck with inventory that they didn't necessarily want. Haven't run the numbers (maybe we do in the future) but it would not surprise me if quite a few users trying to farm Blur actually lost money in the end because the rewards didn't compensate for the ETH they "lost" when their bids got hit.
Well yeah, that's true that some of them, especially those who don't read guides from other sybillers, lose some money. But almost all work here is done by bots.
I, personally, like the HFT way more. Where you farmed with size and got tokens proportionally. So those who really help with liquidity are getting rewarded.