Allium Saved Wormhole $100M+ in its Multichain Airdrop

Allium Partners
Allium Partners
March 27, 2024
15 min read
Allium Saved Wormhole $100M+ in its Multichain Airdrop

This blog post was originally written by Wormhole. You can find the original post on their blogspot at the following link: https://wormhole.com/from-eligibility-to-sybil-detection-a-deep-dive-into-wormholes-multichain-airdrop/

Airdrops can be some of the most exciting yet polarizing events to happen in any crypto community. While some users walk away happy, others might come away with a lack of understanding of how the process worked behind the scenes.

In the spirit of transparency and in the hope of setting a new standard for how projects communicate airdrops to users, Wormhole contributors are providing the following breakdown of the W airdrop logic.

After building and scaling Wormhole for over 3 years since the 2020 launch, Wormhole contributors set out to plan an egalitarian airdrop that would maximize the chance of rewarding the protocol’s legitimate users. The emphasis was placed on two primary groups:

1) Most importantly, onchain users of Wormhole-based multichain apps and bridges; and

2) Key multichain community groups

Over the last three years, onchain users have sent over 1 billion messages through Wormhole's messaging protocol from millions of wallets, using multichain applications across 30 blockchains. These users will receive 81% of this airdrop, which is roughly 549 million W.

Given the protocol’s reach, the Wormhole community has evolved into the most multichain community in crypto. This community is a diverse group of builders, users, researchers, and public figures who care about the ecosystem and work tirelessly to drive it forward. Wormhole contributors also recognize the communities of projects that are built on top of Wormhole as part of the Wormhole community. The key to the Wormhole community is the Wormhole Discord. The Wormhole Discord is where this vast group of people comes together and where community initiatives and conversations will continue to take place in the future.

With these two groups in mind, Wormhole contributors performed a comprehensive analysis of onchain data to examine the complete history of transactions within the ecosystem of multichain applications Wormhole supports. This analysis involved reviewing ownership clustering and behavioral patterns of wallets that have interacted with the protocol and projects built on top of the protocol. Wormhole contributors applied weights to each wallet based on cumulative volume, usage timing, consistency of onchain activity, and other important factors. The goal of this analysis was to identify and reward users who have engaged in genuine interactions with Wormhole over time. To achieve this, Wormhole contributors, in collaboration with external experts from Allium, employed advanced anti-Sybil clustering techniques, source funding analysis, and various other algorithms to ensure that authentic Wormhole users were properly rewarded.

This work culminated in a fair, far-reaching, and robust dataset comprising over 400,000 wallets across more than 30 chains. This dataset, derived from over three years of data, primarily rewards on-chain users. It also includes active community members of Wormhole ecosystem projects. The raw data on W recipients is below:

Summary of this airdrop:

Snapshot Taken: February 6, 2024, 23:59 UTC

Total Qualified Wallets: 400,000+

Total Airdrop Supply: 678,823,000 W, representing 6.78% of the total supply.

Distribution Breakdown:

  • Onchain Users: Approximately 81% of the airdrop supply (roughly 549 million W).
  • Community Groups: Approximately 19% of the airdrop supply (roughly 129 million W).

Below is a deep dive into the airdrop eligibility criteria, sybil detection techniques, and the rewards algorithm.

Understanding the Eligibility Criteria

Onchain User Eligibility

Onchain users of Wormhole ecosystem projects are the largest recipients of this airdrop by a significant margin. They account for 549 million W tokens, which is more than 81% of the total allocation. To determine individual rewards, Wormhole contributors took a snapshot of onchain activity on February 6, 2024, at 23:59 UTC. This snapshot included millions of unique wallets interacting with Wormhole ecosystem applications over three years, and therefore offered a comprehensive understanding of user engagement.

Ownership Graph

Ownership clustering was a central aspect of the analysis. A multichain airdrop campaign is distinctly challenging as users use multiple wallets across different ecosystems. Wormhole in particular connects many distinct ecosystems – EVM, Solana, Move, Cosmos, Algorand, and NEAR. To maximize each user’s chance of qualifying for the airdrop, Wormhole contributors constructed an ownership graph that assigns a unique user ID to a cluster of wallets that belong to the user. Wallets which interacted with any one of Wormhole’s ecosystem applications, such as Pike, Mayan, Allbridge, Portal, and many others, were included. The ownership graph consolidates all transactions a user may have conducted across different ecosystems under a single user ID. This ensures that a user is evaluated based on all of their transactions, rather than on fragmented views of their activities in any particular ecosystem. This technique also served as the first of several steps taken to manually label contracts, protocol relayer hot wallets, and large sybil ownership clusters with several hundreds or, in some cases, thousands of wallets.

Taking the image above as an example, ownership of each interconnected wallet can be attributed to a single user ID. This was used to determine rewards for a single user despite certain wallets not interacting with one another. It is important to note that the total rewards for qualifying users were distributed amongst all wallets in their recognized ownership cluster. Therefore, it is critical to check all wallets that have ever interacted with Wormhole ecosystem applications – both receiving and sending – to redeem the entire sum of one's rewards.

Source of Funds Analysis

In recent months, Wormhole ecosystem applications experienced a massive uptick in sybil farming activity. In order to preserve the rewards for genuine early adopters and new ecosystem participants, a series of sybil detection techniques were applied.

Sybils often aim to fund numerous or – in several identified instances with Wormhole – hundreds to thousands of wallet clusters from a single funding source. Each of these wallets then go on to perform its own set of transactions within the protocol. Wormhole contributors used historical data from archival nodes and extensively labeled exchange wallets and contracts across every connected chain to determine whether the source funding behavior of each wallet exhibited clear sybil characteristics.

The analysis revealed two types of source funding attacks:

  • Diffusion Funding: Wallet A funds Wallets B, C, D .. Z
  • Sequential Diffusion Funding: Wallet A funds B, Wallet B funds Wallet C…

Behavioral Clustering Analysis

While source funding sybil detection is effective, sybil strategies have advanced significantly over time. More sophisticated actors may fund large swaths of wallets individually directly from exchange(s) in an attempt to circumvent source funding detection algorithms. However, performing this activity at scale requires automation and often exhibits behavioral patterns that set these actors apart from legitimate users. By applying the Louvain Community Detection Algorithm on a similarity matrix of transactions over all ownership clusters, Wormhole contributors were able to identify sybils based on repetitive actions performed over time and at similar intervals of other wallet. The image below provides a simplified example of this behavior:

The algorithm maps transactions to unique IDs based on timing, cadence, and action, to match identical or nearly identical behaviors. This separates high density large scale automated wallet actions from low density genuine user actions. Wormhole contributors used this identification strategy only in conjunction with other sybil detection mechanisms.

Transaction Spam Analysis

Another common large scale action involved rapid sequential transactions of identical token amounts, either between two chains or across multiple chains. Wallets with transactions that both matched this activity at abnormally high frequencies and coincided with the large influx of sybil activity starting in December 2023 may have been tagged as indicative of spam-like behavior and subsequently removed from the airdrop eligibility dataset.

It is important to note these sybil detection techniques lie on a spectrum via parameters that tune the aggressiveness of the filtering. The Wormhole contributors recognize that, inevitably, some legitimate users of the protocol may have been caught in any one of the filters, particularly during the most recent period of high sybil and spam activity. Contributors will be thoughtfully reassessing cohorts of users for eligibility over the coming weeks. Today’s update has already expanded the eligibility pool to new wallets. As mentioned in the announcement, rewards for those who may have qualified are subject to change.

Rewards Algorithm

Following the ownership graph and filtering using anti-sybil techniques, Wormhole contributors constructed a rewards algorithm to determine how many W tokens users would be eligible to claim. To provide clarity around the eligibility criteria, some key elements of the rewards algorithm are disclosed below:

  • Timing: Wormhole mainnet launched 3 years ago as one of the first interoperability protocols. Since then, the protocol has reliably facilitated multichain communication through cycles of high and low periods of DeFi activity. The overall allocation of rewards was heavily skewed towards the early adopters and ecosystem applications of Wormhole, to reward long-time and early users of the protocol.
  • Cumulative Transfers: Users had to meet a minimum cumulative value transferred requirement calculated across all linked wallets to be eligible. It is important to note that the raw value was adjusted based on scoring weights related to timing, assets, chains, and other characteristics, some of which are detailed below. The median threshold was approximately $1,500 in cumulative value after adjustments. This threshold was lower for early and consistent ecosystem protocol users and higher for newer users.
  • Key Scoring & Point Bonuses
    • User activity consistent for 3 months or more was given a bonus multiplier.
    • User activity before December 1st, 2023 was given a bonus multiplier.
    • User activity during the previous bear market (June 2022 - October 2023) was given a bonus multiplier.
    • User activity during the first year of mainnet launch was given a bonus multiplier.
    • Users with cumulative transactions exceeding $10,000 in value were given a bonus multiplier.
    • Transactions involving a commonly used chain (e.g. ETH) were given a bonus multiplier.
    • Transactions involving BTC, ETH, stablecoins and other assets central to DeFi were given a bonus multiplier.
    • Transactions involving assets with minimal to no destination chain liquidity were given a negative multiplier.

Wormhole contributors conducted this entire analysis – from ownership clustering, to sybil detection, to development and execution of the rewards algorithm – in partnership with the excellent team at Allium. After the airdrop is completed, Wormhole contributors and the Allium team will publish an extensive technical report on the anti-sybil strategies and clustering algorithms which were employed. This document aims to provide complete transparency to Wormhole users by offering exact insights into the methodologies and techniques that were implemented. We also hope the broader crypto community can benefit from this work to make future airdrops and rewards programs more fair and robust processes.

Community User Eligibility

Details on eligibility for specific community groups

The allocation for this Wormhole airdrop (6.78% of W token supply) was divided between onchain users and developers (~81% of the allocation) and various community groups (~19% of the allocation). Each community group’s specific eligibility criteria is explained below:

Wormhole Discord Participation

Certain members of the Wormhole Discord community will be rewarded based on their active engagement and contributions. Community members who help foster a vibrant community experience, provide feedback on developer experience and product UX, and support new and existing ecosystem applications play a significant role in the development and growth of the Wormhole protocol. Discord users with the following roles prior to the snapshot are also eligible for this airdrop: Spacewalker, Extraterrestrial, and Wormhole Fellows.

Zealy

Zealy users contributed to the Wormhole community via missions such as creating artwork and memes, answering quizzes, learning about Wormhole contributions, and social campaigns such as spotlighting and engaging with teams who work closely with Wormhole. These creative, community driven contributions help communicate the Wormhole protocol’s mission, strengthen the protocol’s brand, and educate others on how the protocol works. They are critical to growing and advancing the protocol. Therefore, the top 500 Zealy participants who had a wallet connected to their Zealy account are eligible for this airdrop.

Pyth Stakers

The top 10,000 wallets by staked PYTH amount on the snapshot date are eligible for the airdrop. Pyth is one of the longest-standing multichain applications built on Wormhole that has grown to serve many valuable crypto projects and ecosystems. The top 10,000 stakers are considered to be some of the most engaged individuals in the Pyth protocol who would also be likely to participate in governance. Therefore, they were the largest community group rewarded.

DeGods/y00ts:

DeGods and y00ts are NFT collections that have made strategic bets on multichain using Wormhole. The DeGods and y00ts teams both used Wormhole to make their collections multichain, and continue to work closely with Wormhole Contributors to build multichain products. The airdrop will reward holders of these collections for being part of the Wormhole Discord and for transferring their NFTs cross-chain with Wormhole in the past. Therefore, holders who joined the Wormhole Discord and obtained the role via Matrica verification prior to the snapshot are eligible for the airdrop. Rewards were attributed to holder wallet addresses.

Bad Kids

Cosmos is one of the primary crypto ecosystems and it is important to the growth of the Wormhole protocol. Wormhole Contributors have also made a strategic bet on Cosmos infrastructure – the Wormhole Guardians operate Wormhole Gateway, which is a Cosmos SDK blockchain that adds security to the network and serves as a router for messaging and transferring tokens into the Cosmos ecosystem. Wormhole is currently connected to 9 Cosmos appchains and many teams in the community build on top of Wormhole.  Within the Cosmos, Bad Kids is one of the largest and most engaged NFT communities.  Therefore, Bad Kids holders who joined the Wormhole Discord and self-assigned the Bad Kids role prior to the snapshot are eligible for the airdrop. Holders can check their eligibility by connecting via Discord on the website.

Mad Lads

The team behind Backpack and the Mad Lads NFT collection has worked closely with Wormhole Contributors to build multichain products and to help grow the protocol. Backpack offers in-wallet cross-chain transfers via Wormhole and Mad Lads holders make up one of the most vibrant Solana NFT communities. The Mad Lads community has also positively contributed to the Wormhole community Discord. Therefore, Mad Lad owners who joined the Wormhole Discord and verified via Matrica prior to the snapshot are eligible for this airdrop. The allocation for this community will be 20% liquid and 80% vested daily over one year. The liquid reward and vested amount is soulbound to each NFT. Holders can check their eligibility in the Backpack wallet.

Monad

Monad is a highly anticipated, EVM-compatible, L1 blockchain that will leverage Wormhole for multichain functionality and cross-chain transfers at launch. The Monad community is an active and engaged group of users and developers who care about building state-of-the-art infrastructure that will push the industry forward. 1,081 Monad community members will be  rewarded for their participation in the Wormhole community Discord. Members can check their eligibility by connecting via Discord on the website.

Airdrop FAQs

General

Q: Where can I read details about the airdrop?

A: The airdrop details can be found in this blog post.

Q: Where can I check my eligibility for this airdrop?

A: Please check all your wallets and/or Discord on the airdrop checker at airdrop.wormhole.com.

Q: Wen claim?

A: Please follow Wormhole on Twitter or other social channels for updates.

Q: Will there be future airdrops?

A: Please join the Wormhole Discord and follow Wormhole on Twitter and other social channels for any future community initiatives.

Q: What happens to unclaimed tokens?

A: After the airdrop claim period is over, all unclaimed tokens will be returned to a multisig and reserved for usage in future Community initiatives.

Q: I think I should have qualified. How can I submit a request to be reconsidered?

A: Diligent effort was put into making sure no one was overlooked. If you think you should have qualified but did not, you can submit a request here: this form.

Q: What was updated in the most recent update (March 11th) of the airdrop checker?

A: The most recent update of the airdrop checker and eligibility list includes additional cohorts of users – these include community groups such as the Wormhole Fellows and Degods/y00ts community members, and additional groups of onchain users. The checker website also received several updates, such as improved Sui and Algorand wallet compatibility.

Q: What if I should be eligible after the update, but the checker still shows nothing?

A: Users who checked eligibility before the latest update may still see nothing if they don't clear their cache. Please do a hard refresh and check again.

Q: Why were rewards distributed across all of my wallets?

A: A number of users raised concerns around the risk of attributing all rewards to wallets with lost keys or compromised security. Rewards were therefore distributed across all user wallets – sending and receiving – to maximize the chance that users can claim their entire allocation. Note that rewards for the same EVM wallet used across multiple chains were aggregated into a single “Ethereum” reward. Therefore, users might see larger allocations attributed to their EVM wallet addresses relative to non-EVM wallets.

Q: Why are wallets with one small transaction qualifying for part of the airdrop?

A: Rewards are distributed across all sending and receiving wallets within an ownership cluster, regardless of the number of transactions any single wallet within that cluster may have participated in. In the example below, Wallet E (0x696) has only one transaction associated with it. However, since the cumulative value transferred across all wallets exceeds the qualifying threshold, User A is eligible and their rewards are distributed across all wallets, including Wallet E (0x696). We understand this may cause confusion, as users might not have realized the analysis could attribute their ownership to all interconnected wallets across different ecosystems.

Note: Given the diversity and scale of the Wormhole ecosystem, Wormholescan and third party APIs will not contain all information used to calculate eligibility.

TOKENOMICS

Q: What is the total supply of W?

A: The total supply of W is 10 billion tokens. See the W Tokenomics blog post for further details.

Q: How is the initial circulating supply of W determined?

A: The initial circulating supply of W tokens is 1.8 billion. The token will be allocated across six main categories: Guardian Nodes, Community & Launch, Core Contributors, Ecosystem & Incubation, Strategic Network Participants, and the Foundation Treasury, with 82% initially locked and set to unlock over four years. The tokenomics structure is designed to support Wormhole's long-term success, stability, and progressive decentralization.

Q: What percentage of W are locked, and how will they be released?

A: 82% of the W supply will be locked at launch. This amount will be unlocked over four years. This gradual release is designed to support Wormhole's long-term success and stability. Read more about the tokenomics and release schedule here.

Q: What is the W token distribution?

A: W will be distributed across six main categories: Guardian Nodes (5.1%), Community & Launch (17%), Core Contributors (12%), Ecosystem & Incubation (31%), Strategic Network Participants (11.6%), and the Foundation Treasury (23.3%).

Q: Can you explain the "Community & Launch" allocation for W and how it is being distributed?

A: The "Community & Launch" category will support the early stages of Wormhole's decentralized and permissionless future. Of the total 17% allocated to this category, 11% will be unlocked at the Token Generation Event (TGE) to facilitate the initial distribution phases, including the TGE-related airdrop. Approximately 6.78% of this 11% will be used for this airdrop to reward community members who have actively used the product and supported the ecosystem. This airdrop is a direct acknowledgment of their contributions and engagement.

The remaining 6% of the "Community & Launch" allocation is scheduled to be unlocked four months after the TGE, in line with the overall Token Release Schedule.

5% of the “Community & Launch” category (~81% of this airdrop) is allocated towards users of onchain Wormhole ecosystem applications. 1.29% of the “Community & Launch” category (~19% of this airdrop) is allocated towards community members such as active members of the Wormhole Discord, various NFT communities, the top 10,000 Pyth stakers, and the Monad community, to recognize their active support and engagement within the Wormhole community. The Wormhole Foundation is committed to rewarding active product users and Wormhole community members, as they are vital in the Wormhole protocol’s continued growth and success. Read more about W allocation here.

Safety Notice

Users and readers are advised to be cautious and remain vigilant against potential scams. Verifying that any webpage linked to Wormhole is hosted under the wormhole.com domain is crucial to staying safe from scams and phishing attempts. All official community and social channels are also listed on official web pages. Wormhole-affiliated moderators and team members will never reach out to you first or solicit any kind of personal information.

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