Vitalik Buterin Highlights Potential of Airdrops as an Initial Use Case for Zero-Knowledge (ZK) and Blockchain-Based Identity

Cryptocurrency projects heavily focus on incentivization to generate interest in their brand and products. Airdrops serve as a dual-purpose strategy

Cryptocurrency projects often rely heavily on different methods of incentivization to generate interest in their brand and products. One technique that serves a dual purpose is airdrops, which both introduce users to the project and reward them. This approach functions effectively as a combined marketing and reward system.

There have been a significant number of airdrops this year. Notably, Ethereum co-founder Vitalik Buterin has highlighted the potential of airdrops as an initial use case for Zero-Knowledge (ZK) and blockchain-based identity, credential, and attestation frameworks.

On August 28th, Buterin posted on X, outlining the core goals of airdrops. He highlighted the importance of targeting community members, rewarding contributions, and maintaining a balance between egalitarian distribution and resistance to exploitative farming tactics.

In his post, Buterin argued that these objectives align closely with the properties that identity and credential frameworks aim to achieve. He suggests that using token issuance for airdrops presents an ideal opportunity to beta-test and refine these frameworks in a challenging environment, as detailed in his recent post on “plurality” principles.

Buterin further expanded on the idea that giving tokens away for free is not the only effective approach. He suggests that discounted sales, where the reduced level is based on the degree of membership or contribution one can demonstrate, could be an equally viable method.

This approach not only helps distribute the token supply more broadly but also rewards non-financial contributors while ensuring participants have “skin in the game.” Buterin also pointed out that techniques used for airdrops can be applied to these discounted sales.

He also referenced a related concept proposed by CT and Idena Network, which involves subsidizing savings rates for smaller accounts as an alternative to Universal Basic Income (UBI). This concept draws parallels with Singapore’s Central Provident Fund (CPF) system, which implements a similar strategy.

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