Distribution

The way tokens flow to network participants.

Token distribution defines the owners of a specific network. Distribution options vary widely and continue to evolve with advancements in the technology.

Classic Methods

Pre-mine

A pre-mine indicates the portion of the token economy minted upon launch of the network. This allocation typically goes toward investors of an ICO as well as founding team members.

Airdrop

An airdrop describes a network that decides to send tokens to a list of addresses. This tactic may be used in retroactive distribution, social distribution, or pre-mining schemes.

Block Rewards

A system of distribution that rewards network participants for helping support the underlying consensus algorithm.

Emergent Methods

Retroactive Distribution

The retroactive distribution rewards a userbase or following of a certain application, artist, or community by giving network tokens to those who have supported the application, artist, or community in the past.

This model was first pioneered by Rarible and then Uniswap. Recently artists like RAC have begun distributing tokens to fans.

Examples

Introducing UNIUniswap Protocol

Grammy Winning Producer RAC Launches Community Token with ZoraDeFi Rate

$RARI airdrop to NFT holders: everything you need to knowMedium

Liquidity Mining

Liquidity mining became particularly popular in 2020. The technique pioneered buy Andrej Cronje at Yearn.Finance rewards participants who stake tokens to support a specific decentralized marketplace. In return they receive a yield on their staked tokens.

Examples

https://hummingbot.io/

Yearn Financeiearnfinance

Social Distribution

A less developed form of distribution involves sending tokens to a group of people via social media networks. There are many technical challenges with this distribution tactic today.

Applications Today:

Unite

Yup • Social Network for CuratorsYup

Crypto for Creative Communities

HomeRoll - the new standard in social money