Points go up
It's more powerful than ETH go up
I woke up on a Saturday morning and felt very annoyed.
I had only received 90 additional points in my airdrop tab for Friend Tech week two.
This is a really weird thing to be annoyed about because this entire week has been very profitable.
I was early to Friend Tech, did huge volumes, and had a pretty consistent win rate, taking home more profit than I have in weeks.
My trading strategy was clearly correct from a returns optimisation point of view.
Yet these mysterious points, with no current monetary value that I suddenly lacked, put me in a bad mood.
I’ve heard many people say that Airdrops are pointless and argue that they don’t drive user retention. Could it simply be that the ones we’ve seen so far have been badly designed?
Incentive programs are designed to incentivise, a one-time drop of tokens to people who have previously interacted with some weird esoteric criteria is unlikely to influence future behaviour in a project's favour.
However, if I woke up feeling so strongly about some mysterious points with nothing but speculation about an unknown future backing them, then there must be hundreds of others who felt equal jubilation or sadness depending on their score.
The beauty of well-designed incentive mechanisms is that it turns the protocol or the app into the game. The aim of the game is to maximise points while minimising losses. This keeps players engaged as the team takes the required time to build out improvements, test new ideas, and bootstrap the project.
It also gives players the sunk cost fallacy. If you’ve already poured weeks of effort into accruing these points, a little fud or a small loss here and there won’t deter you from continuing.
We’ve seen this evidenced with Blur when, despite the leading farmers losing money hand over fist as the NFT market took a beating, they continue to reload and go again.
Points-based rewards are also an incredibly low-cost way to onboard influencers who can drive new users to your project. If we look at the top list on Friend Tech, we can see the who's who of CT influencers donning the top positions, with Only Fans artists, NBA players, and esports professionals joining the ranks.
If the site had simply opted to pay all of these influencers using traditional methods, it would have cost them millions of dollars, appeared incredibly forced and inorganic, and a large percentage of them would never say yes anyway.
Friend Tech, for all its flaws, is truly a fantastic case study in virality and driving human behaviour by using open-ended points systems that allow the end-user to imagine whatever future they desire.
I’d suspect we will continue to see teams use the Paradigm encouraged method of acquiring users, as from my experience, market participants love it, and so far, it’s working wonders.
For me personally, I’m all for it. If I can compete for points and eventually airdrops in a fair meritocratic manner, rather than fight against a hoard of bots doing $0.1 transactions and demanding thousands, I will be in my element!
Thanks for reading and have a great weekend!