Hayden Adams, founder of the Uniswap protocol, shared his thoughts on what characterizes a good distribution or launch of a token. In a recent post on the X platform, the prominent cryptocurrency figure highlighted the complexity surrounding cryptocurrency launches by listing 10 characteristics of a good token distribution.
Uniswap founder gives his opinion on good token distribution
Adams began his thoughts on good token distribution by saying that projects should allocate “tokens, not points” to the community. This phrase means that rather than receiving points, which may have limited utility, participants should receive actual tokens that hold value within a specific ecosystem or network.
Although not targeted at any specific project, I’ve seen a ton of discourse on this topic recently, so I thought I’d share my thoughts on a good token distribution.
1) Tokens, not points
2) Don’t farm farmers. Teasing and creating ambiguity about token distribution to increase numbers…
— hayden.eth 🦄 (@haydenzadams) May 4, 2024
Second, Adams warned against being vague or ambiguous about distributing tokens to increase participant numbers or “farm the peasants.” According to the Uniswap founder, a good token distribution method includes sharing actual details when they are ready.
Adams also criticized “low-floating tokens” as malicious. Prominent DeFi figures urged the project team to ensure there are enough tokens in circulation to prevent manipulation and enable real price discovery.
Adams also discouraged hype about how token prices will skyrocket before launch. The founders believe that hiring influencers or marketing companies to promote the value of the token is merely a get-rich-quick scheme rather than a genuine attempt to build real value.
Moreover, the Uniswap founder emphasized the importance of free token airdrops during token distribution. “Don’t be stingy. Donate a significant amount. If you don’t think the community deserves a significant amount, don’t release your tokens,” Adams said in his post.
Ultimately, Adams advised new cryptocurrency projects to be cautious and thoughtful in their decision-making to avoid mistakes that could cause conflict with the cryptocurrency community. “Build something you’re proud of and stand behind it,” the Uniswap founder added.
Friend.tech and its Jab?
At the beginning of the post, the Uniswap founder made it clear that the comments were not aimed at any specific project. But the timing is interesting. Especially after the “failed” token airdrop by social media platform Friend.tech.
On Friday, May 3rd, Friend.tech airdropped new FRIEND tokens to users in conjunction with the release of version 2 of the protocol. The token’s value quickly rose to $167 after launch, but FRIEND’s price plummeted to less than $2 within hours.
Analysts pointed to liquidity issues and massive selling as the main reasons for FRIEND’s downturn and ultimately ineffective token launch. Moreover, many users have complained about how difficult it is to claim token airdrops, with technical shortcomings frustrating the process.
UNI price stalls at $7.5 on the daily timeframe | Source: UNIUSDT chart on TradingView
Featured image from Shutterstock, chart from TradingView
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Source: NewsBTC.com