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What Makes a Great Airdrop?
Recorded: Sept. 11, 2025 Duration: 1:03:03Space Recording
Short Summary
In a recent Twitter space, Radix and Sonic executives discussed the launch of Sonic's platform, the strategic partnership for a new incentives campaign, and the evolving trends in airdrop strategies. They emphasized the importance of sustainable growth and community engagement over mere vanity metrics, with Radix committing to distribute a billion XRD in rewards.
Full Transcription
Thank you. Thank you. Thank you. Thank you. Thank you. Hello, everybody, and welcome to another Twitter space with Radix.
My name is Adam Simmons, joining from the main Radix account, as X does not seem to want to let me talk on my personal account.
But that does not matter because
joining me today is none other than the assistant from Sonic. Matt, how are you doing? Can you hear
me? Hi, how are you? Can you hear me? Yes, can hear you loud and clear. Thank you very much.
Just having the joy that I usually have with X Spaces of they they don't like different mic inputs do they
ah this thing sucks i don't know there needs to be some type of alternative eventually
one day one day we'll have the technology when elon's not like you know building robots and
stuff i guess like they'll get around to it i mean at point, surely you could just type into Grok, like fix X spaces. Yeah, it should just be.
I mean, granted, I think that people just take it,
you know, we take it, we take,
we take it for granted because you don't know how many people are using X at
the same time.
So it's probably like an insane amount of people like doing spaces.
You kind of only see your own circle, right?
But like if you zoom out and
look at how many spaces are going on right now and how many live participants there are i'm sure
it's insane so like they have to have some pretty robust infrastructure and it's probably a lot of
work but yeah yeah i i started my career in the online video space and the the technical lift to get like even like on-demand video let alone live
video streams working for tens of thousands of participants let alone like tens of thousands of
people streaming simultaneously is unimaginably complex yeah yeah yeah yeah for sure thanks for
having me join i i've actually i think i had like met some people from Radix. I think we're chatting in Telegram a few years ago in like Texas or something. But yeah, thanks for having me. Happy to chat about this and, you know, curious what the topics are, you know, what you have planned for today.
you know what you have planned for today. Yeah so I mean why don't we kick off obviously the
most of the people tuning in today will be familiar with my voice less so with with yours
so I'd love to hand over to you to do a quick introduction of yourself and I'm sure everyone's
familiar with Sonic but give us give us the elevator pitch. Sure my name is Matt otherwise
known as the assistant. I've been in crypto since 2013.
I started with Sonic around like two years ago.
And yeah, I'm the chief strategy officer at Sonic.
So I work on a lot of like the partnerships,
like larger scale partnerships, deals,
you know, kind of anything that, anything that really involves like getting the pen to paper
and getting a contract signed on both sides so I've been working on that a lot for the past
year I'd say like really finalizing things on Sonic Chain because Sonic actually just only
launched like nine months ago so yeah it's been a hectic year with the run-up of sonic i'd say like september
october november december and the launch in december um and yeah here we are now but you
know i'm pretty active in the community i'm always available to chat with people regarding just
general crypto stuff or sonic or defy and uh yeah we're just pretty much heads down right now focusing on a few
primary i'd say you know we focus on a lot of like the short-term goals and let the attack
team focus on the long-term goals but we're pretty focused on the short-term goals right now like
that we can we can dive into more awesome and uh as a fellow cso i assume you also wear the hat as as radix assistant of uh kind
of doing a lot of many things as well yeah i mean i think that the team is pretty large and although
i don't work like directly with the tech team as as much i do work with like the day-to-day operations
team and you know working on like events that we have going on we have an event
coming up in singapore um working on community initiatives uh growing the team uh our our latest
usa initiative which is pretty which is a big task which is pretty exciting for sonic considering
we've never really been like usa focused a lot of those types of um
short-term initiatives and yeah things are going things are going well on that on that side yeah I
mean it's fantastic to see the growth and as you say like Sonic only kind of launching as no one
nine months ago is super impressive the traction that's been had throughout there and one of the
reasons we wanted to to have this space because obviously a big part of that was uh the radix incentives so the sonic incentives
campaign radix has just kicked off our incentives campaign and um i'll be i'll be honest we took a
lot of inspiration from the approach you guys took um i was also i've got to say personally
pleased to see that a lot of the things that we implemented was before you announced season two
and some of the changes you made there and a bunch of the stuff that you brought in at season two is
things that we kind of incorporated into our season one to match there so I thought it'd be
great to to jump on and talk kind of broadly and generally about where incentives campaigns for
especially kind of like L1s and the network layer have been over kind of history and especially
where they are now and where they're going.
So I guess like my first big question, this is something that came up loads when we were
discussing with the Radix community about the Radix Rewards campaign was simplicity
versus complexity of the system.
And one of the battles I was constantly fighting in kind of debate, which is probably fair
to say is more of a debate than a fight around it, whereas a lot of people kind of point to DAP specific airdrops or obviously things like the hyperliquid airdrop
campaign and like, hey, this is getting quite complex. Like, why don't you just keep it simple?
Just like, just reward traded activity. Don't worry about anything else. Just trading or just
TVL or something like that. And as well as Radix, like Sonic, obviously you guys have a bit more of a complex system so it'd
be great to talk about how kind of you see that's that balance of like keeping it simple for easy
comprehension versus making sure that it's incentivizing the activity that's useful i think
that's just to be clear i'm not the like we have a team managing the airdrop so i just want to
be able to give my feedback but some of the
things may be slightly maybe inaccurate i don't know they're they're they're constantly updating
the airdrop because they work closely with like uh with uh open block labs who kind of monitors
the whole airdrop so i might if i say anything that's off maybe just i haven't been keeping up
with it on like every single day um but things haven't really changed so much in the past, I'd say, few months.
I think that it is difficult to find a balance between having a very, let's call it, hyper-focused airdrop which is hyper focused on let's say
liquidity provision versus an airdrop that's more focused on like fee generation or a focus
an airdrop that has some focus on like social media growth it's pretty you know dynamic in terms
of where you want to target.
Like, there's so many options where you can target
and finding the balance between where is the highest,
like, let's call it ROI in terms of airdrop is for the community.
So it's definitely not an easy task, right?
There's a lot of moving pieces that go with it,
specifically at Sonic.
Like I mentioned, we work with open block labs which is you know a large provider of like data scraping right so they are
essentially working with the team to fill in a criteria and then kind of report and calculate
points based on the criteria that we provide in addition to that it also requires
someone from our team who's willing to be essentially just working on this almost full
time right like it's a lot to make sure that there's a pretty strong amount of accuracy on
the points um yeah we've we've learned a lot of things from the airdrop i think that airdrop meta
is like constantly changing so there might be some airdrop. I think that airdrop meta is constantly changing.
So there might be some airdrop meta that's really relevant for three months or six months,
and then it just changes.
So you need to be able to be dynamic when it comes to organizing the airdrop.
That's probably the one thing that I've learned or our team has learned the most,
which is every airdrop needs to have flexibility.
100%. has learned the most which is every airdrop needs to have flexibility a hundred percent and how how have you like built that into or how's the team built that into kind of what you're doing with
the sonic airdrop obviously working with uh open block and kind of tweaking things and the change
you made with season one is there how how frequently do you look to mix things up so like
on the on the radix side we we've purposely designed it to have like a weekly cadence so that each week we can go and it it is um we've but we've got it
so essentially everything all the rewarded things broadly stay the same we can add things every
single week or or change things but we from the design step the amount of points that you get for
everything we have it as adjustable down to the granular level of like every single individual liquidity pool or activity are you guys are you guys indexing
this data yourselves yeah so one of the well we we have a slight advantage because the the radix vm
is asset oriented so rather than like needing to look at smart contract updates and stuff like that
the the vm essentially tracks all of the asset state constantly um on a per user
basis so when you get you can basically track all of the like lp positions and everything else like
that are returned as either like nfts or fungibles or pool units that are native to the vm so rather
than having to index all the different smart contract states and like equivalents we can
basically just query that on Ledger
directly from a core note.
Oh, that's very interesting.
I've never heard of it.
Yeah, it gives us some good benefits.
Definitely still has challenges in there.
So pricing is obviously a big one
of getting accurate price feeds
through oracles or using DEX prices
and stuff like that, malicious attacks.
But yeah, a lot of that is kind of the
things we we get some benefits there which are less tuned things a bit more complex on the other
side but definitely the same on the indexing side was a a big one but still a large undertaking
regardless so i think that the the flexibility in terms of flexibility right one of the more
important things is being able to adjust when there's
potentially a malicious act, right? Like let's say for example,
you're incentivizing providing liquidity on a certain protocol.
If that protocol has some type of malicious activity,
what you're going to want to do is you're going to want to disqualify it as
soon as possible and effectively just remove everything, right?
Like you want to, as fast as you can, you know, it might take a day or two, but to really
get a grasp of the situation and then like remove it from the website, remove it from
actually like indexing data there so that this way you're not indirectly guiding anyone
there, right? this way you're not indirectly guiding anyone there right i think that all air jobs it's it's
pretty um it's pretty sensitive in terms of like you wanting to incentivize people but also not
force people to do anything right and i think that it gets mixed up with the general public
sometimes because if you're
trying to incentivize let's say like providing liquidity on a certain decks they don't have to
do that right like you don't have to provide the liquidity there so giving options for people on
different different venues of the same type of earning is also nice because then you can you can
segregate the the yield the the risk a bit more.
So let's say, for example, you are running a chain
and you're only incentivizing one stablecoin on one DEX,
on one money market, on one NFT platform or something.
What ends up happening is that you kind of indirectly
just force everyone just to use those apps, right?
And I think that it's important that you give people the option so that they can make their own like human decision
in terms of where they want to put their funds so keeping it so that you're able to add options
for people and keeping it dynamic whether you can add or remove qualifying applications is great.
And, you know, just as easy as you're willing to disqualify one
if there's some type of malicious activity, you should be able to add one.
But there's a lot that goes into making sure that, you know,
you're not just adding an application which has
the potential to have any malicious features like hidden inside of it like it's you need to do some
due diligence there so far things have been pretty decent on our side digging deep into those
applications and making sure that we have like long-lasting partnerships and not just listing
any app that just pops up i
mean we get even now like we get requests probably i don't know maybe three four times a week of like
hey we're launching can you add us to their job campaign um but i mean that's an easy marketing
vector for people to just be able to try and take advantage of a whitelist so you got to be careful
with that yeah and i don't know if you found this or do you find this but i think it's a really
challenging part of like a chain level strategy is balancing that not wanting to be a kingmaker
with also making sure that you're directing people towards things that are valuable, not going to get like give undue risk to them or destabilize like the wider on-chain economy, so to speak.
So exactly as you say, like there's there's negatives to saying, oh, if it was only one one asset on one deck is the only thing that's rewarded.
rewarded you end up driving everything to that which can kind of centralize liquidity in one
place too much and sure there'll be some kind of long tail trickling out that but it creates a
problem in itself but to the same degree the other way as you're saying if you just reward everything
you massively increase the surface area for potential exploits and attacks yeah i mean there
there is a very fine line there but there are certain there are certain exceptions like specifically battle-tested applications like
the easiest example is if you were to incentivize usdc and then ave like usdc is i mean usdc is usdc
right and if something goes wrong with usdc we've got bigger problems than our incentives campaign
that's also usually my general train of thought,
like for specifically putting funds in Aave or USDC myself.
Like I try to apply that.
It's like if you deposit money into USDC, right,
and you're worried about there being some type of systemic attack on USDC,
like the broader DeFi or crypto world is kind of screwed if that were to happen.
So there are safeguards against that on
the on their side and then if you look at the abe for example like abe is similar like abe has like
80 billion or something in deposits like if something were to happen to abe it would be
really big problem so that's generally my my own methodology for like when i'm personally
depositing into anything as i try and think like
is this going to have a larger impact if there is uh an issue and if so am i just screwed anyway
you know what i mean like if i'm in another market or another stable coin am i screwed regardless
but but specifically in terms of sonic like usdc and ave are are like i wouldn't mind having concentrated risk there because again it has like
80 billion dollars the official ave team um it's native version of usdc so i think there are some
exceptions uh that's definitely one of them that could be made um you know maybe a more bespoke
stable coin or something like that is a little bit more risky i think we've seen that
a few times even on sonic right where uh you just need to be cognizant of stable coin collaterals
uh people really get mixed up in understanding stable coins that's one of the biggest flaws of
stable coins i think is that people assume that all stable coins are created equally um they're definitely not and uh
yeah i mean just you need to be able to have that diversity amongst assets but also have those like
core staple assets and and protocols where you can safely scale tvl and you can safely kind of
grow this more composable defy ecosystem ecosystem with those specific tokens and applications as the backbone
to at least have some type of money market or something,
the ability to do even the most basic DeFi principles on chain.
And I totally agree with that.
And the approach that we've taken with Radix Rewards as well
is you have different time gates for it as well.
So on the USDC side, another thing that we've looked at is how you, and a reason for going for like this weekly update cadence was you may want to update the amount of rewards that you're providing for different activities based on how the market responds to it.
So on using USDC, for example, we've got...
That's a fair fair that's actually
like we we currently we only launched this week for example with it we want to make sure that
we've got enough rewards across like blue chip liquidity stable coin liquidity on decks isn't
in money markets because ultimately the vast majority of all defy activity is going to fall
back to being either a stable coin or one of the big blue chips is how most people are going to dominate their activity. And until you've got
that up and running, trying to get a big like long tail of kind of top 200 on CoinMarketCap or
something or going into like native altcoins and stuff like that is a challenge because until you
attract that liquidity in and to the same degree, we're also looking at that on actually how are
we rewarding
things like trading versus liquidity provision because you could have massive rewards for
trading on day one but if there's not enough liquidity in those pools then you're going to
have high slippage you're going to have inefficient markets there's going to be it also depends on
what the assets are because some like i think that there is a really big difference in terms of
trading like stable coins versus like you can have essentially if you have a chain that has
billions of dollars of stable coins yep like that's great i guess that you're able to have a
lot of maybe it's for like remittance or yield or something but in terms of like fee generation and
defy you don't really generate any fees off of stable coins um the most you're generating fees off of blue chip
volatile assets so having those i mean that goes into a whole different conversation of like
incentivizing in range liquidity i think you're seeing i think i've heard that being done on
linea uh where they're specifically targeting like an incentive campaign
for in-range liquidity um because now we're doing that as well oh really yeah so we have different
um factors on the amount of points you earn uh depending on how close and how concentrated your
liquidity is on say a dex so if you're doing a standard like simple pool on essentially a
uni v2 style pool you earn half the amount of points
versus if you're within a if you're in a concentrated pool within a certain percentage
band of that um again it's because it's like economically that liquidity is more active
and so it's going to be utilized more in creating velocity of money in the ecosystem
and it's generating more fees and creating a higher risk as well so it's kind of
on time if we do do that i'm not sure the exact mechanism in terms of like incentivizing like
what the ticks are and stuff i think it can get very specifically when it comes to like uni b3
style pools um it can get kind of complex in terms of the where the liquidity is how often the snapshot is taken whatever
um but yeah i think that maintaining a correlation between like productive tvl and points is very
very very important um not even because of the civil measures where people can just abuse the
airdrop but also for just genuinely
being able to reward those who are taking more risk, right?
Like if you're providing very wide range of liquidity, like sure, you're on the chain,
you're doing activity and you're getting involved, whether it be in the chain's ecosystem or
like that app specific ecosystem.
But if you're providing liquidity that's actually productive like you're
putting your like you're putting your money where your mouth is right because you could lose money
um it happens right people go out of range they end up get their their their assets end up getting
kind of all piled over onto one side in terms of concentrated liquidity sometimes that can really hurt you specifically i've seen this happen a lot where people are holding like let's say it's
let's say you're holding like a liquidity pool with like a meme coin or something that has a
high volatility on the meme what happens if the meme is really volatile you're providing a
concentrated liquidity position and then it goes out of range you end up
being all into that meme coin and then the meme coin price just tanks is like you just you just
get screwed um so i think that the people who are putting the time into monitoring these positions
they're putting in the effort to make sure that they're generating some type of fees, you know,
and actually providing liquidity at the same time and not just some vanity liquidity,
then they deserve to be rewarded.
And yeah, I mean, if you're able to monitor that and successfully track it on the chain side,
then it's a great thing for the users because then they feel like
their risk essentially is being rewarded in terms of points or the actual final airdrop or whatever
the case may be. Yeah. And I think the big kind of guiding star we've had from the start when I was
designing this program was A, there was no point trying to stop exploitation because ultimately your surface area
of people who are trying to attack a system is going to be exponentially larger than the number
of people trying to work out how to prevent it and so our kind of goal was if you make the rather
than trying to eliminate attack vectors but make the cost of attack greater than the value of being
able to attack the system is probably better like economically disincentivizing is going to be way more than trying to detect bad actors
and stuff like that.
So like a good example of this is we have a lot of incentives that when you sign up,
you are massively advantaged in 99.9% of cases to link all of your different wallets and
accounts together to take part in the incentives rather
than like account splitting and that allows us to do a bunch of stuff downstream so it kind of
do you how are people doing that are they signing like an on-chain transaction or something so uh
radix radix daps we basically have a um system where you have a separate between your identity and your account
address. So both are on-chain represented in a similar way, but you basically have an account
that is like a decentralized passkey. And then your accounts that hold assets are like a standard
account. So you sign into the Radix Rewards campaign with, we call them personas. And then
on that persona, you then go, hey, I want want to link these accounts and then you just sign with each of those to uh do a proof that you own that account
and then that gets tracked what's the current together what's the current size of um of the
airdrop so we've got we have a billion of xrd that's going to be distributed so season one
is going to be between 100 million
xrd and 200 million but that's also based on like milestones so depending on the amount of tvl we
hit dex volume we hit a number of like active accounts we had all of those sort of metrics
as a program that unlocks like additional milestone bonuses to go from that 100 million to 200 million rewards. Nice, nice. Yeah, I think that it's kind of hard to,
there's like this issue with airdrops
that I've noticed probably over like the past year,
which is if you're advertising an airdrop
or like marketing or building up anticipation of an airdrop
it actually ends up hurting you more in the end i think that the best route to go it's kind of like
this double-edged sword like chicken and egg situation where like you want to capitalize on
doing an airdrop but you also want to set realistic expectations for the airdrop um
arguably more of the airdrops that you've seen that have been a six like a large success they
weren't really advertised they were just done but then it's not you can't not every project can do
that usually only projects that are tge and can do that right and and for sonic it's a lot different
because it wasn't a tge so that also threw off a lot of people because they're like even till this
day i still see people saying like oh when is the tge and i'm like what's like so i mean the the
whole meta of airdrops has definitely become uh very. Let's call it like post hyperliquid. I think the
hyperliquid airdrop was amazing. I think they did a great job. I think that people are trying to
emulate that right now. But I will say that the reason why certain airdrops like hyperliquid did so well is because their product has
like it's not like it wasn't a chain right at first like they they were just basically
building this hype up off of a product and not raising capital and all this stuff and
had a lot of lp and had a had a specific had a specific like revenue generating product right off the bat which
obviously isn't something that was like i don't i think that like hyper liquid like was like created
in a laboratory right like that's my thought whenever i think of a hyper liquid i'm like it's
so great like hyper liquid is a great product it was definitely created by a team that knows exactly what they're doing and even the airdrop like it was well fabricated like they put together their
airdrop so perfectly because they were just in a good position with the launch of the platform in
itself so i think it is hard to emulate that it probably sets pretty steep unrealistic expectations of how to conduct an airdrop because everyone just assumes
like airdrop in general is a good like a good term to say oh like we're doing an airdrop because they
see how much it worked on something like hyper liquid um but one of the other examples which
i'll give which i think is something that even at the time that we were
taking a strong look at is like the barachain airdrop yep um at the time it was insane
i got i don't know how long ago this was maybe it was a year ago but it was just insane it was
about i want to say december time yeah yeah no but no it was late in that because later than the sonic airdrop
was announced yeah i mean i think that
there's a few there's a few things about about that i think that they did a good job of building
up a lot of hype based on the amount of deposits yeah a lot but there's such thing as like getting
too many deposits i think because then what happens is is that you just set yourself up for
a like a uh let's call it like like you just fall off a cliff kind of i don't know how to say it but
like they did an amazing job and i always give credit to the bear chain team because the ability to bring that much tvl that
quick is like pretty impressive yep um it's definitely not easy even if you're doing an
airdrop like it's not easy to do that and they brought a lot of tvl now i think that
like i mentioned before they probably brought too much tvL. The more TVL that you bring like that, and depending on the assets, you have a higher likelihood for it to fall off.
Because it's just dependent on people just opportunistically trying to farm, which I understand because I think people misinterpret how those types of airdrops work.
Those types of airdrops are not really like you know if there's a if there's a
i'll give an extreme example if there's a million dollars in liquidity deposited like that million
dollars isn't comprised of like 10 people or even 100 people depositing that million it's like one
person right um a lot of these airdrops they like to go after getting these big tvl deposits and doing
like private deals and doing liquidity provision deals because they want to get like the headlines
early on i mean even me like at sonic we tried to do that a bit like talk to some really large
liquidity providers the problem with that is that they want you to like lock in like an apr and we were we were not that's
we're not willing to do that and like we didn't we wanted to reward the community and i'm confident
to say that like i'd say at least 95 of the airdrop just purely went to just regular normal
people that weren't like big farming entities trying to take advantage of the airdrop which
makes me happy i mean when i look through the airdrop list it's just a lot of people
um with just normal size holdings that were able to to participate and that's great that being said
we did make some mistakes on the airdrop and being able to pivot and quickly make an adjustment to that, that's very, very, very important.
I can chime a bit more on that, too, because you guys are probably going to run into some of the same issues that we ran into.
Yeah, it'd be really good. the other kind of north star that we had in designing the radix program was we want to
enhance any economically viable activity so what we didn't want was a scenario where
like in the case of just getting a massive amount of tvl deposited it's like cool that's good for
like vanity numbers to get some hype and those sort of stuff but it's very fleeting and if people
are only doing that activity for the rewards as soon as those rewards either taper off or decrease
or stop, you're going to see that capital leave because it's mercenary capital ultimately.
Whereas if you're going, actually someone, this is an economically viable activity. So even if
there was no rewards, there would still be an economic benefit of these assets being used in
that way. Then enhancing that just increases the pull factor to get those using those capital.
And again, a slightly abstract view is like I'm more and more thinking about kind of L1s and L2s
and like network level incentives and operations as being very much like you care more about the GDP than necessarily just the total
value of assets within the system. Because if in that case where you get like a billion dollars
of TVL come in, but if you've got no demand for that and it's just basically sat there static,
you're not generating fees, you're not generating those LPs, any revenue or anything else.
That's usually what happens on all these things but i mean
at that point there is this is actually an interesting thing because i've had this
argument with so many people over the past probably two years where i i do think that
if you look at like what you're saying right in terms of a financial point of view, there is a very clear ROI factor.
What you're saying is basically this money needs to be productive.
If the money is productive, then there's an ROI on whatever the airdrop is, correct?
Yep, correct.
However, there is a large portion of that, which I think needs to go to be like,
let's call it like you kind of write it off for the marketing, right? a large portion of that, which I think needs to go to be like,
let's call it like you kind of write it off for the marketing.
Right.
Because let's say right now, if you were to have like,
if Radix facilitated getting $10 billion of TVL,
and even if it was just all shit TVL,
right.
And it was just nothing.
It was just like the narrativel right and it was just nothing it was just like
the narrative of getting 10 billion tvl might be more valuable than the actual fees generated from
that tvl and i think that's a really good case like i think there's there's an argument for that
my devil's advocate would be that because of kind of the airdrop meta evolving over the last year or two is that
i think a lot of the market especially the kind of smarter money in the space has become very
acutely aware of vanity metrics um so i won't name names obviously but like you see some things of
like oh yeah yeah zero zero percent fees for trading and you're like oh we've got a trillion
dollars of traded volume and it's like you go and dig into it and it's like 10 accounts just round
robbing it because there's zero fees and you're like you know what like we we see that we see
that at sonic a lot like i almost sometimes think that it's at this point like it's just part of the
industry like honestly like i think that the people there there becomes a fine line
where you start to notice that these metrics just don't make sense i don't want to name any specific
chains but i do look every i'd say like every couple of days i'm digging around looking at
stats of chains and i'm like i looked at a chain the other day and I swear to you, it said wallet generation
and like address new addresses on chain in 24 hours was like 600,000.
I'm like, why is no one people have no problem.
Like let's just look at two extremes sides of the of the spectrum here, right?
If you look at a chain and they're producing 600,000 new wallets in 24 hours,
and let's say that's all fake.
And then you look at a chain that produces 2,500 wallets in 24 hours,
but it's all real.
Which one matters?
The one that's real or the number of people just talking about the fake one?
So I'd say it's the number of people talking in the short term.
But I'm a firm believer in the kind of Y Combinator method.
The most important metric you have is week on week growth.
Yeah.
Because if you're hitting that, like you get it sustained.
I think these guys, they know that and they do that.
Like they make it and they do that like they make it
artificially do that so they it's the reason why i'm mentioning this is because it's it's
like kind of the same just a lot of these airdrop campaigns where you see like very structured tvl
deposits you won't just see like all the money get deposited at one time they'll be like very
strategically kind of ramped up and in pre-tge products i think it's there's so many factors to this i'm glad that
we're talking about because i've been thinking about this for so long but like if you're a new
chain and you just raised capital right your vcs like they're very incentivized to go to their
liquidity providers which they have access to tons of money if specifically specifically if they're
an asian vc like asian vc like liquidity providers i've
noticed are much more active in the defy scene i don't know if it's because of like us regulation
and people are scared to like provide liquidity but most of the firms in asia like they're very
very active um but let's say like you were to see a a chain launch they come out with a campaign they have a lot of VCs those VCs it's in
their best interest for there to be a lot of TVL early on because it's indicative of like the
success of their investment so you know they go out and they they they'll get that TVL for their
for their for the project like they will bring that TVl it was a little bit harder for us to do because we didn't have like those vcs that we can go to that had invested in like
our tgr ico or private sale you know and be like hey you guys want to deposit you know 200 million
dollars here um it'd be really great for your you know for your seed investment where you invested
at like some crazy low valuation.
That's what happens on all these new chains.
And that's why they're able to get so much TV on the beginning.
But the TV tends on going away.
That's why I'm pretty proud of the amount of TV that we have on Sonic even now.
I think it's around like 400, 500 million dollars.
Like that's still a lot.
Yeah, it's not easy to get that much and i still think there's great
yielding opportunities um on sonic better for stable coins specifically there's a lot of
opportunities and yeah just what i'm trying to say is that like getting that tvl sometimes for
as a chain is really easy but you don't know what's going on behind the scenes. There might be extra incentives that are being paid out like backdoor. We've been asked that so many times where they're essentially just dumping on on you. So like, yeah, you're farming and earning these rewards. But by the time those rewards become liquid or something, they're dumping on you first so you might not actually roi what you expect a hundred percent and that's that's what i mean on like is it well you may get that
short-term marketing value from it is i do think the market's wising up to it but even from a like
one one thing that stuck out to me is like you're saying that when you're looking through the sonic
airdrop list and saying like 95 of it being real users or like your regular user
group is that is that is creating a brand affinity and loyalists ultimately who are going to stick
around because you've had a good experience you've you've been rewarded for it and also been involved
in things that actually become an activity you want so like a big thing we always it's a term we have in radix like radix revelation of like when you use it you're like holy shit this
is really cool to use i like this and if you're also generating profit from the activity that
you're doing even when the incentives kind of slow down or stop or anything like that you're
going to see those people stick around a lot more especially if they haven't just got dumped on by vcs and i think this is something that again the market's
wising up to is that chains like sonic like radix that aren't the big vc chains is sure in the the
wave you necessarily may want to ride of everyone thinks they're a gigabrain at the end of the day
they're like oh yeah i know it's a vc chain so i'll buy and i'll sell before they dump on me
sort of thing it's like yeah you can do you can play that game it's kind of like
the meme coin game but building lasting value if you're talking basically it is yeah like if you're
building lasting value actually these are the projects that i think win over a longer term and
again won't obviously won't name names but you look at i'm sure you do as well i look at some
chains and some things and you see some of the metrics that they're reporting,
and you're just like, there is absolutely no way in hell
that is the truth to it, honestly.
Those chains that report like that also,
you also have to remember that they're,
I don't want to say they're indebted to,
I don't want to say they're indebted to.
well, they kind of are.
Well, they kind of are.
They're like indebted to the VC, right?
They're like indebted to the VC, right?
So like they don't want to disappoint their investor.
So they'll do whatever.
And they may have real risks if they do.
It's almost like the typical Silicon Valley model.
If you look at a lot of the traditional Silicon Valley VCs and stuff like that,
you see very successful companies that from the outside look like they're shooting themselves in the foot on some of their decisions, but it's because
they've just got to hit certain user retention level or user growth numbers that are completely
unviable and not actually good for the business in the medium or long term.
But if they don't, their next funding round doesn't hit or something triggers in a clause
somewhere with a VC.
And externally, it looks very weird.
But if you're on the VC side and you're looking to just get to the next series
or to the next round or to the next unlock or something like that,
you go, well, I'm going to get the leadership team to work on those things
because that's what makes me money.
And then you get the misaligned incentives.
And I think this is something that crypto as a whole has got a really bad rep for
over quite a long period of
time if before obviously like the vc bubble you had the ico bubbles and these sort of things where
there was like the pre-sales and private rounds and stuff like this which can cause a lot of
headaches for people and especially as the global regulatory environment is really warming up to
initially stable coins but i'm sure rwas are going to be next. And then DeFi is inevitable,
in my opinion, is going actually the networks and chains that have built true brand advocacy
and done things not necessarily the easy way, but the right way are in a much stronger position.
The question is whether the super successful VC chains just have too much network effects from,
as you say, the marketing of just having, oh, we're the first chain with a trillion dollars of TVL or something.
Is that enough of a factor to draw people in that they kind of gloss over the fact that
it's slightly inflated, shall we say?
Yeah, yeah. I think that there should be a nice rotation into, let's say, more community-focused chains.
And that's why I'm glad this whole Hyperliquid thing is great for, I wouldn't call it decentralization because I don't think that it's a benefit that hyper liquid was able to
not raise capital so it gives people hope that you can create a successful project without having
to go out and raise like hundreds of millions of dollars which for some people that's like
totally fine and they want to do that and that's the route that a lot of these fun a lot of these startups want to go
down because i think as crazy as it sounds like going to get like what is what i'm curious like
what is your logic on that like do you think that going to raise like 200 million dollars or 300
million dollars and you see crazy numbers now do you think that that's harder to raise the money
in your opinion or harder harder to raise the money,
in your opinion,
or harder to not raise the money and launch the product?
Because there's some people,
they find it very difficult to raise money.
I think they're just different skills.
And also, as you said,
there's not a proven benchmark for it. So on Radix, the option to raise like that
was essentially impossible, even if we wanted to,
because Radix started
back in 2012.
We'd been community funded for ages before, like ICOs were a thing or anything like that.
Oh, wow.
I didn't know that.
Yeah.
So Radix has been around for like, yeah, since 2012, 10 years of R&D, went live, had
these other bits go through.
So you can't then sit there and go, hey, we've got a live token and let's go and raise
$100 million or something because a VC is going to sit there and go, well, we know what this is.
There's obviously a fair market value for it, all these sort of things. Whereas if you're a large L1
who has gone and raised a lot of money, pre-token generation, pre-tokenomics or anything like that,
essentially you can write down whatever you want.
And the VCs, if they're backing that,
can kind of enforce that through a bunch of other stuff
to kind of get to that position.
Especially when it comes to an airdrop,
I think that the VC is probably also participating
in the airdrop.
Yep.
So, yeah.
Look, I think I want to stress the fact that I think that every airdrop yep so yeah i look i i think i wanna i wanna stress the fact that i i'm i think that
every airdrop depending on the community depending on the chain depending on the time
in terms of like the cycle in terms of what the narrative is in terms of what the trends are in the airdrop world. I think that airdrops are probably going to
change to just be only focused on projects that are not building up too much hype for them. I think
that a lot of people learn from Hyperliqu hyper liquid they'll just like do a point campaign
you just earn points sure there's some anticipation of earning an airdrop but it's not like the
product isn't the airdrop you know what i mean um i think that that's probably what the future
looks like and you know we're like i had like i had mentioned like we're we're always learning and we're always adjusting and
um who knows maybe there'll be some bigger changes to the airdrop in the future i'm not too sure but
the the ability to have some amount of flexibility when it comes to taking in feedback from the
community taking in feedback from builders community, taking in feedback from builders,
observing what other chains are doing,
observing how they're pivoting,
how they're improving, how they're sunsetting.
There's so many factors to take into consideration
that I think that if you give yourself
a long enough timeframe for an airdrop,
it gives you the ability to basically do whatever you need.
Maybe it's not working.
Maybe you just need to just end the whole thing and then you can just go ahead and end it.
Right.
I think the biggest mistake that you can make when it comes to an airdrop is kind of just let it fail.
Right. Like, I think that that's the last thing. is kind of just let it fail, right?
Like, I think that that's the last thing.
And I think that that's something that I would always recommend
to anyone doing an airdrop, which is have aspirations
to make sure that the airdrop is a success.
Make sure you have everything set up in terms of infrastructure,
partners, your team, methodology,
but always have that option where you can just say
this isn't working um let's pivot let's do something else with the funds uh let's burn the
funds let's reallocate to maybe a more concentrated set of strategies i don't know i just having it's almost like the you're you're
kind of preaching the jeff bezos one way or two-way door philosophy of like trying to keep
things as a two-way door uh his one-way two-way door if it's a door you can go through and if
it doesn't work out come back out of again yes do it quickly see if it works if it's a door that
once you step through it it locks behind you think really damn carefully before you go through that door
and that's good that's very i think that's like you don't want to sit there and go hey we're
going to allocate a massive airdrop on day one and regardless of what we learn between then and now
we're committed to this exactly this way regardless of what new information you get
like i think that's a really dangerous strategy i think it's hard it's hard that part is hard
because like what i was mentioning before which is like keeping up with trends i remember seeing
this i can look it up but i remember seeing like when was this it was probably like two years ago
polygon had announced that they were doing like a billion
dollar incentive program i was like at the time when i saw it i was like holy smokes like that's
that's insane right um but then you start to realize like is that just like a marketing stunt
or is it do they actually plan on following through with that and then how does that impact
people because then if you don't follow through on that then people will always kind of go back
and quote you on that so you need to be very careful on how big that you're big you're going
in the beginning like in the initial I think that's why we try to phrase things at sonic very
carefully because we don't want to fully commit to doing something if
it doesn't work because if you say like we are giving out let's say you have an airdrop of 100
tokens like yeah we're giving out 100 tokens this is exactly there this is it 100 tokens um
and then something happens maybe it's the economy maybe there's like a luna type of situation it's
like okay hold on we need to like tone back on this maybe we need to slow it down maybe we need
to delay it um to restart it later or something so like giving yourself a flexibility in an airdrop
is definitely critical because there's so many things that can happen in crypto that are
unpredictable um so yeah i think that the moral of of this kind of space is that I would like to stress to anyone listening.
It's like you need to have flexibility in a lot of the things that you do.
There's so many factors in airdrops that you can't control.
And being able to at least have a team in place that is prepared to pivot and that is open to new ideas and that is fairly quick when it comes to actionable items.
That's what you need to have because you never know what's going to happen.
And on that, I completely agree with that ethos.
on that i i completely agree with that ethos and i think it's one of these things that comes down to
kind of tying together a bunch of these topics around like vc chains and like temporary tvl and
stuff like that is that you don't necessarily need to have it set in stone exactly what you're going
to do but having it really clear and sticking to the i I don't want to say ethics, but having the integrity
of what you're trying to achieve and following that and sticking to that religiously, I think,
is the certainty that crypto communities and just communities in general people rally behind.
Because yeah, things may change. But that's the difference of if you're sticking with a
sticking with a defined vision, goal, and do that with integrity and in good faith.
If things do need to change, you're changing them based on those North Stars,
rather than seeing they're just being impulsive or like rug pulling someone effectively or something like that.
And I think this is kind of ties back to these same principles that like Sonic demonstrates, Radix demonstrates,
a lot of kind of the OGE changes as well demonstrate, is going, well, if you're, if you are good to
your users, if you're good to your community, and you're good to the product you're building,
and you're clear on the problems you're trying to solve, that gets a lot of brand advocacy,
which kind of comes back to my, my point on the VC thing is like, I've thought often
of like, would I rather have $100 million in the bank or a incredibly motivated user base?
And in the short term, the $100 million would be great. In the long term, I think that the kind of
diehard user base is worth 10 times that, as long as you're able to sustain operations.
worth 10 times that as long as you're able to keep to sustain operations and i guess that my fear
as the industry as a whole not as not as radix or anything like that is like can chains like sonic
like radix deliver this growth over a long term or is it just the the artificially inflated metrics
the hundreds of millions of dollars and the kind of games that are being played outside of the original ethos of what crypto what dlt technology was originally kind of founded on
from a principle standpoint getting eroded to the point that it's the cost of doing business and i
think that can lead you into some really interesting things where is it necessarily right
to play those games if it is a net harm to the industry and kind of the wider
space because every time someone gets dumped on by by a vc or something like that it doesn't just
harm that project it harms all of the people who impacted that's opinion on the entire industry in
space and yeah i i don't know if it if it is if it's just the cost of doing business that you need
to have half a billion dollars in cash from a vc to just pump the numbers do the flashy things at
a massive way to play the game getting very difficult because there's just so much
trad fi money going into those types of uh those types of like targeted chains i think that a lot of those trad fi let's call them like
syndicates they've come to the conclusion that if they own the chain then maybe they feel safer
with the tvl on the chain specifically if it's a layer two because they have a lot of like
administrative control over yep rolling the roll up. Right.
But look,
I think one,
the thing that I'll, I'll end this and thanks for having me by the way.
It was a great conversation and it was nice to talk about,
you know,
to see what you're doing,
chat about what we're doing.
I'm always open to having any conversation when it pertains to Sonic or,
or just crypto in general.
But one of the things i would recommend to you i
don't know if you've done this is we periodically put together like little focus groups um every
time it's like random people but usually it's just it's not from twitter because twitter is
i don't recommend putting together a focus group that'd be an interesting focus group yeah we'll put together like a handful of people um on like telegram groups
like some of the people that have been whether they've been in the community for a while whether
they're like builders or uh like builders of apps on on the chain or people from outside of the chain
that were partners like infrastructure providers um few team members
and usually just regular community members and like you know uh just sonic specific groups
we'll just pass some ideas um you know whether it be governance ideas we'll ask for feedback
and it's kind of nice for reality check we did that in the beginning with the airdrop and got like a lot of good feedback.
I wish we did it more frequently.
But again, you don't want to make two updates like every five minutes to start changing things.
We've made a couple of tweaks to the airdrop.
Usually it's like a seasonal thing that are like larger changes.
So like season one differs, season two differs from season one.
Along the way, like we're like adding and removing assets yes but we're not making like massive message
uh methodology changes but even if we did like we just kind of chat with the community
um and yeah there's we've gotten really good feedback from people over the years and you know
you'd be surprised sometimes people actually give
good feedback on things like this couldn't couldn't agree more um and what a brilliant note to end on
so matt thank you very much for joining um before we wrap it up where can people find more insights
from you learn more about sonic um feel free to do a quick kind of shout out for all the places
people should go.
Awesome, man.
Thank you so much.
I don't know if you're going to be in Singapore,
but we'd love to invite you to Singapore Summit.
We have going on just the days before Token 2049.
Anyone who's going to Singapore,
we'd love to have you come to the event.
I think tickets are like 50 bucks or something.
The website for Sonic Summit is summit.soniclabs.com so if you want to come learn more about sonic you want to meet the
team want to meet some of the applications that are launching we have a bunch of new launches
coming up that i'm pretty excited about um yeah come find us where we we go to a lot of events
all over the world uh i don't know what your name is because it just says Radix Host, but...
Adam, wouldn't let me join on the main one.
Yeah, of course.
Thanks, Adam.
It was a pleasure
and look forward to meeting you in person
if you're at any of these events coming up.
Sure, we will.
Thank you very much, Matt.
And thank you everyone for tuning in.
It's been a pleasure.
Take care. Thanks. Thank you.
