Under widespread pessimism, what is the current operational status of the "involution" grooming studio?

Author: Nancy, PANews

"The bull market is for trading coins, the bear market is for harvesting airdrops" is a popular saying in the community. Harvesting airdrops is considered a low-cost wealth-building strategy, especially with the wealth stimulation from airdrops like dYdx, Arbitrum, and Aptos, leading to a surge of "wool party" participants, which has even evolved into "airdrop hunters" equipped with professional tools and resources.

However, it is not easy to harvest "big wool" among the vast number of projects. Recently, airdrops from CyberConnect and Sei fell short of expectations, leaving many airdrop hunters with no gains and even facing losses. As a result, some studios have begun layoffs or even shut down and transformed, leading to an increasing chorus of voices predicting the decline of the airdrop industry. Will the airdrop industry really face a widespread halt? What is the true operational situation of these studios?

In this article, PANews interviewed several airdrop studios, some of which declined to be interviewed and frankly admitted that they faced bankruptcy risks due to not having harvested big wool yet, while others had anticipated risks and transformed early, and some focused on mainnet projects with relatively low risk of witch identification. They remain optimistic about the development of the airdrop industry.

High Returns Come from Early Participation, Usually Cashed Out Directly

Compared to those who entered the market recently due to the wealth effect of airdrops, the interviewees, Master Dong (pseudonym) and Web3 Blue Sky Studio, are early participants with years of experience in harvesting airdrops.

Master Dong joined the airdrop army in 2018 due to Dfinity ($ICP) and established his studio in early 2020. Master Dong revealed to PANews that his studio currently has a scale of thirty to forty people, with teams being built in Singapore in addition to those in Chengdu and Vietnam. In their business, activities like airdrop arbitrage are collectively referred to as execution-type businesses, such as interactive airdrops, testnet nodes, and new listings, which are further divided into many smaller categories.

According to Master Dong, his studio is a high-frequency participant on the early token public offering platform CoinList, and they have not missed almost any projects. "At our peak, we had over ten thousand accounts in line." Among the projects they participated in, Master Dong disclosed that the airdrop probability was relatively high between 2020 and 2022, and they usually sold for profit immediately after receiving airdrops. The project with the highest return was Aptos ($APT), "Since we applied for the testnet and claimed NFTs, we had no other capital participation costs apart from labor and server fees, with an average profit of about 1500 USD per account."

Similarly, Web3 Blue Sky Studio is also an early participant of CoinList. This small team of six is currently focused on deep interactions with 4000 zkSync wallets. The studio began participating in new listings in 2021, at that time having over 10,000 accounts, and typically cashed out directly after receiving airdrops, with overall profits around 10 million RMB. Among them, the platform earned the most from Arbitrum and Aptos, with 2 million USD and 400,000 USD respectively.

Based on years of experience in harvesting airdrops, Master Dong candidly stated that their costs mainly come from labor and servers, and of course, the time cost is also high, as many projects have long airdrop cycles, with some projects distributing airdrops only after two or three years of participation. Web3 Blue Sky Studio also mentioned that harvesting airdrops is a project where short-term gains are not visible, making it difficult for many to persist.

The Right Approach to Dealing with "Being Witched"

For airdrop hunters, in addition to the uncertainty of airdrop expectations and the basic risks of asset theft and fraud due to high-frequency on-chain interactions, the difficulty of harvesting airdrops has been increasing with each airdrop.

Currently, more and more project parties and data analysis platforms are launching their own anti-witch standards and identification features, which also exposes them to risks of no profits or even being counter-harvested. For example, in December 2022, DeBank launched the witch address marking feature; in March this year, Arbitrum detected nearly 150,000 wallet addresses from eligible airdrop addresses through anti-witch measures, accounting for over 20% of the total airdrop; recently, the multi-chain trading infrastructure zkLink launched a new loyalty points system 2.0 as proof of participation in its ecosystem and introduced strict anti-cheating measures, which not only deduct points and issue warnings for first-time offenders but also blacklist users who continue to cheat after receiving warnings, canceling their qualifications.

Faced with increasingly stringent anti-witch rules, the chances of earning through harvesting airdrops will further decrease. Therefore, Web3 Blue Sky Studio has chosen to participate in mainnet airdrop projects and reduce investment costs by analyzing certain projects. "The more PUA projects there are, the more problems like witches arise. In the future, the cost of on-chain airdrop harvesting will continue to rise, and anti-witch rules will not only be limited to on-chain data; facial recognition will also become a trend."

"For a studio to survive, it not only needs money but also the infrastructure required for harvesting airdrops. There is no reliable third party; self-building is the hard truth." Master Dong's studio has launched a technical department to develop its own cloud system, independent fingerprints, independent devices, and independent IPs, which are stored in the cloud and can be operated online anytime and anywhere.

Studio Competition Leads to Professionalization, Even Launching Airdrop SaaS Platforms

Recently, with the sluggish crypto market and several projects offering weak airdrops, the accelerated reshuffling of the airdrop market has put many studios at risk of transformation or closure, leading many to start pessimistically predicting the decline of the airdrop industry. In response, Master Dong stated that under FOMO emotions, it is normal for studios to struggle to make money and face closure due to a lack of patience, funds, and luck.

"In uncertain situations, studios do not need to blindly expand; they should focus on wallet isolation and anti-witch measures. Especially at this stage, it is not recommended for ordinary users to enter; IPs, fingerprint browsers, Twitter, and Gmail are all significant costs," Web3 Blue Sky Studio pointed out in the interview.

In fact, as the current airdrop industry is showing high levels of internal competition, "wool party" participants are beginning to professionalize, and their businesses are becoming increasingly diversified, even leading to the emergence of professional harvesting services and training classes.

Recently, the community leader of Benmo, Super Jun, tweeted that "a few friends' airdrop studios around me are not only not closing down but are becoming more professional, with personnel configurations constantly upgrading. On one hand, they have reaped substantial rewards from previous ARB, SUI, etc.; on the other hand, they also engage in DeFi and arbitrage, making enough money to sustain the studio."

Master Dong also revealed to PANews that entering the second half of 2022, on one hand, they have stopped large-scale project participation unless the airdrop probability is high; on the other hand, they have begun transforming and seeking new paths, with initial successes. According to Master Dong, their main business now includes not only airdrops but also a SaaS system service department for airdrop harvesting, a KYC department, and an MCN department under construction.

At the same time, Master Dong mentioned in the interview that the threshold for harvesting airdrops will continue to rise, and the threshold is not only about money but also requires talent and infrastructure. Therefore, in a bear market, everyone should focus more on learning and less on action, cultivating talent. However, he also pointed out that airdrops, testnet rewards, and various IDOs are all ways for projects to distribute tokens, and as long as new projects are launched, these activities will occur, leading to arbitrage opportunities. The airdrop industry will not disappear or halt; what will halt is the heightened enthusiasm and the cries of new studios.

In summary, in the future, project parties will adopt stricter review mechanisms, which means that airdrop studios lacking risk management awareness and financial reserves will have even less room for survival. However, at the same time, airdrop hunters have become an important part of the crypto project ecosystem, and they still need airdrop hunters to provide a stage for their development.