Insights: Gitcoin Airdrop Analysis
A deep dive into the Gitcoin airdrop (+ detailed statistics & charts)!
Gitcoin is a platform where contributors can earn bounties posted by open source projects. In addition, users can post about the project they’re working on and receive grants through individuals and organisations that would like to fund open source.
As the Gitcoin platform matured, they decided to an airdrop in order to decentralize and transition to a DAO structure. The Gitcoin DAO emitted over 10.5 million $GTC tokens during it’s month-long airdrop running between 24/05/2021 - 23/06/2021.
Summary Statistics & Findings
The $GTC airdrop was successfully claimed by 14,562 addresses. Out of these 14,562 addresses, 67.5% of addresses went on to subsequently dump all of their tokens and receive a resulting score of 0. This distribution is inline with other previous airdrop scores we’ve explored such as our Ribbon Airdrop Score and ParaSwap Airdrop Score.
The distribution of the claimed amounts is shown below. Claim amounts followed a standard power law distribution, with the top 10 addresses claiming more than 11% of the total $GTC claimed during the airdrop. The median claim price was $686.
Distribution of $GTC claim amounts in USD.
Even with such a large number of token holders dumping immediately after claiming their airdrop, $GTC has been highly resilient to these effects. Besides an initial crash immediately after the airdrop, it appears that the skeptism of Gitcoin by the airdrop claimers is not supported by general market sentiment.
Most surprisingly, not all $GTC tokens were claimed during the airdrop event. Out of the 15M tokens allocated, only 10.5M were actually claimed by eligible recipients. Sadly those who missed out still regularly attempt to claim their previously-entitled to tokens with no success.
Distributor contract: https://etherscan.io/address/0xde3e5a990bce7fc60a6f017e7c4a95fc4939299e
Insights From The Gitcoin Airdrop
What’s most interesting of all from this airdrop is the explicit mention that the token has no economic value. This is quite rare - most protocols wish to imply that a token has more utility than it actually does.
Hence any economic value derived from the token must be purely from it’s importance in governing the DAO. Surely, those who held on to the token then must be more interested in decentralised governance? We’ve subsequently constructed the following hypothesis - addresses with a non-zero Gitcoin Airdrop Score are more likely to be involved in governance on Snapshot and believe in its utility compared to those with a Gitcoin Airdrop Score of zero.
We can validate this hypothesis using a fairly standard experimental procedure. By collecting governance data about both airdrop recipients and a representative sample, we can compare and contrast differences in behaviours. We’d assume that our findings show that those who held the airdropped tokens vote more than dumpers and the representative sample.
From our initial list of 14.5k airdrop recipients, only around 8.7k ultimately went on to vote in any proposals on Snapshot. These voters are on average more active than the casual snapshot voter found in our representative sample. This is most easily seen in the following histogram.
This finding is supported by looking at the median number of votes cast per address. The airdrop recipients voted in 66% more votes compared to our control group.
However, this aggregated view of airdrop recipients obfuscates the true reality of the participants. As mentioned prior, there are over 67.5% of addresses who dumped their entire token holdings as soon as claiming the airdrop! We should instead consider this cohort of users in three distinct categories:
Dumpers - these are addresses who effectively sold most-to-all of their airdrop. They are addresses who received a score between 1 - 9.
HODLers - these are addresses who claimed and never sold. They are addresses who received a score of 90 - 100.
Believers - this final category of addresses are those who sold some of their airdrop, but decided to still retain a portion of the claim for whatever reason. They have scores between 10 - 89.
Given these three groups - who votes more now? Again, we can assume that non-dumpers will be far more active in snapshot governance compared to both dumpers and the control group. To adjust for addresses who have governance tokens in multiple projects, we can instead look at turnout rates in Gitcoin proposals to understand each groups behaviours.
Generally, airdrop recipients are a significant but non-majority representation in proposals. They on average represent 43% of all votes cast. Note that this does not consider the weights of those votes. Rather, we only care about the behaviours of these addresses more so than the importance of these addresses.
When we split this cohort into the aforementioned groups, the turnout trends become much more obvious to distinguish.
Dumpers are the least likely to be participating in governance. This makes total sense. If you sell all your tokens, you are no longer eligible to vote in governance proposals. They do, however, still turn out to a lot of proposals.
Given that the Gitcoin DAO were toting that their token had no economic value, and was primarily used to influence governance decisions on Snapshot, the DAO should have relied more on public data sources such as Snapshot to help qualify their recipients.
At ARCx, we score individual addresses on a range of historical behaviours you can use to build your airdrop filtering logic. Scores such as the Index Coop Governance Score allow you to get a measure of governance participation, and scores such as the Ribbon Airdrop Score or ParaSwap Airdrop Score allow you to understand the propensity that your addresses will dump your tokens immediately after claiming.
If you’d like to understand your community’s on-chain behaviour for an upcoming airdrop, please reach out to us!