Posted October 24, 2024 at 7:00 am EST.
In the past year, points programs have rapidly proliferated throughout the entire crypto landscape, most recently reaching the Bitcoin ecosystem, which is now undergoing a fresh wave of innovative experimentation.
Crypto protocols deploying points programs often have a legal disclaimer emphasizing how points do not directly translate into any financial value or claims of a protocol’s native token. And yet, team members of nascent projects often use points programs to track user engagement that determine how many tokens a wallet addresswill receive in an airdrop.
Since Blur popularized points programs in 2022, they have become a standard practice in the crypto industry. This trend has especially gained traction in 2023 and 2024, with over a dozen protocols such as EigenLayer, Kamino, Blast, and Drift implementing points programs before their token generation events. These four alone have a collective market cap exceeding $1 billion at current prices.
And now that activity has spread to Bitcoin, whose developers are experimenting to give the first blockchain smart contract functionality and make the first cryptocurrency a more productive asset, and not just a store value. Smart contracts are blockchain software programs that are executed when certain conditions are met, similar to a vending machine.
On the other hand, liquid staking initially emerged on proof-of-stake blockchain Ethereum, enabling people to secure the network, earn a yield, and maintain liquidity to participate in other financial activities. While Bitcoin is a proof-of-work blockchain and does not have native staking capabilities, Bitcoin staking allows BTC to be used as collateral to provide security to other proof-of-stake blockchains.
Here’s a list of ten Bitcoin protocols that have points programs where users are expecting a token airdrop.
1. Solv Protocol
TVL: $1.8 Billion
Solv Protocol is a Bitcoin staking platform whose flagship product, SolvBTC, is backed 1:1 to native BTC and enables holders to participate in various DeFi activities across Ethereum, BNB Chain, Avalanche, Arbitrum, Base, and BOB.
While SolvBTC is an ERC-20 token on Ethereum that has over a $1 billion market cap, the protocol also has liquid staking tokens, such as Solana-based SolvBTC.JUP, which launched Oct. 17. These tokens allow holders to stake their BTC and earn a yield, while maintaining liquidity, forgoing the need to lock up their BTC and making it illiquid.
Users can earn XP, an incentive for users “to receive Solv airdrop tokens in the future,” a blog post states, by depositing funds into Solv Vaults. The more one deposits and the longer one’s deposits sit in vaults, the more XP a user earns, according to an April 2024 blog post, which also stated that referring friends to the platform is another way to accumulate XP.
While the protocol’s documentation has stated a potential airdrop in the future, Unchained was not able to identify when it will occur. Solv did not respond to Unchained’s requests for comments.
Read More: The One Senate Race That Could Give Elizabeth Warren More Power Over Crypto
2. Babylon
TVL: $1.6 Billion
Babylon is a protocol designed to enable BTC holders to stake their bitcoin and provide security to blockchains using proof-of-stake consensus mechanisms.
The protocol launched its points program alongside the rollout of phase 1 of its mainnet staking process over two months ago. In Babylon’s current stage, BTC stakers are not earning any rewards for contributing to the security of various proof-of-stake networks, “so we need a way to record the contribution of Bitcoin holders who actually lock their bitcoin in preparation of future phases,” the protocol’s co-founder Fisher Yu told Unchained. “We just use points to mimic the normal staking rewards.”
At presstime, crypto users can earn points by staking through Babylon’s web application and delegating their BTC to finality providers. Babylon is one of many protocols saying that points “may never convert to, accrue to, be used as basis to calculate, or become any tokens or other digital assets,” per an August blog post
Babylon is still in its first stage. Babylon set an initial limit for the number bitcoins that can be staked. Then on Oct. 1, team members increased the cap size and reopened bitcoin deposits for staking temporarily. At presstime, Babylon is not accepting any more BTC deposits.
3. Lombard
TVL: $693 Million
Similar to other Bitcoin staking protocols, Lombard aims to help BTC become more than just a store of value by making it a productive financial instrument and enabling holders to earn yield. The protocol’s main product is its Bitcoin liquid staking token LBTC.
Lombard‘s Lux points are virtual representations of LBTC usage, according to the protocol’s documents. When asked whether Lombard will have a governance token independent of LBTC, the protocol’s co-founder Jacob Phillips told Unchained over Telegram, “No official plans at this time.”
4. Bitlayer
TVL: $387 Million
Bitlayer is a Bitcoin layer 2 blockchain that is compatible with the Ethereum Virtual Machine, the environment that executes all smart contracts code across Ethereum nodes.
The L2 is based on the BitVM paradigm first introduced by Robin Linus that aims to bring more smart contract capabilities to Bitcoin, which at the moment are reduced to basic operations, according to the BitVM whitepaper.
Read More: Kraken Launches Wrapped Bitcoin Token kBTC
On July 22, Bitlayer rolled out its “Racer Center” points program. “In the future, $BTR airdrops will be allocated based on user levels and Bitlayer points,” a blog post stated. BTR points will eventually be converted into an airdrop before Bitlayer’s token generation event (TGE), said a Bitlayer moderator who goes by @adisunata on Discord. In response to a community member asking when TGE will occur, @adisunata wrote, “In Q4-2024.”
5. Corn
TVL: $351 Million
Corn is an Ethereum layer 2 network that uses tokenized BTC as its gas token. The network is rewarding users with points, termed “kernels,” which represent a person’s share of the protocol’s upcoming CORN allocation set to occur after its mainnet rollout, according to an August 2024 blog post.
The protocol’s interface takes a pixelated-gamified lens by which a user can do a number of activities to earn kernel points, such as depositing various BTC assets or referring others.
Depositors acquire 1 kernel for every $10 deposited, every 21 minutes, per the protocol’s documents. In the protocol’s Discord server, some users who have to wiggle their way through a bot-verification process have asked about “TGE,” an acronym for “token generation event.” which had 176 results.
One of the community moderators, @mian8, said, “TGE exact date is yet to be announced, stay tuned!”
6. PumpBTC
TVL: $224 Million
PumpBTC is another player in the Bitcoin liquid staking arena that serves as a mechanism for BTC holders to earn yield on tokenized representations of bitcoin such as BiT Global’s wrapped bitcoin (WBTC) and synthetic bitcoin on BNB Chain (BTCB). “By accumulating PumpBTC Points, users position themselves for potential advantages and rewards as the platform evolves,” the protocol’s homepage states.
A PumpBTC moderator who goes by @sugardaddy1998 in Discord said Wednesday evening, “I don’t have official information about [an] airdrop sir. Kindly wait for [an] official announcement,” as a reply to a community member’s question about bonuses and rewards.
7. Bedrock
TVL: $220 Million
Bedrock is a multi-token liquid restaking protocol. Not only has Bedrock integrated with Ethereum-security sharing platform EigenLayer but it also partnered with Bitcoin-focused Babylon in issuing uniBTC.
Since Babylon currently supports staking BTC and not other tokenized representations of BTC, Bedrock provides staking rewards to WBTC holders who don’t need to redeem their WBTC back to BTC. Bedrock issues uniBTC which “represents the staked wBTC plus all future staking rewards and accrual of Babylon staking rewards and Bedrock diamonds,” the protocol’s FAQ states, referring to Bedrock’s version of points.
“The Bedrock Diamonds system is designed to incentivise loyal users and reward them with Diamonds,” per the protocol’s documentation.
Bedrock did not respond to Unchained’s request for comment. In Bedrock’s Discord server, a team member wrote, on Oct. 19, “Bedrock TGE is not yet announced.”
Read More: Coinbase’s Wrapped Bitcoin Product cbBTC Launches on Base and Ethereum
8. Echo Protocol
TVL: $146 Million
Echo, a Bitcoin liquidity layer, aims to introduce restaking solutions for BTC assets built with Move, the smart contract programming language widely used for applications built on the Aptos and Sui blockchains, though Echo’s flagship product is aBTC which is supported on Aptos.
The protocol’s total value locked (TVL) increased by roughly 465% since Monday from $26 million to nearly $148 million at presstime, making it the fourth largest protocol on Aptos. The restaking solution helped Aptos surge to an all-time high in TVL at $885 million, DefiLlama data shows.
Crypto users are already planning for a token airdrop as they are earning points from bridging, lending, borrowing, and staking assets. However, the team has yet to announce any plans.
9. Lorenzo
TVL: $163 Million
Lorenzo is a Bitcoin liquidity layer where users are focused on staking bitcoin and minting stBTC, the protocol’s native liquid staking token. Lorenzo’s stBTC represents the amount of staked BTC, while a separate twin token, YAT, accrues that staking yield from stBTC.
The purpose of Lorenzo points is to encourage staking and participating within the DeFi ecosystem, while the function of these points will be “primarily used for future project token airdrops,” according to a July 2024 blog post.
The protocol has seen substantial growth in deposits to nearly $163 million, a 383% increase since Oct. 16 when its figure was under $34 million, per DefiLlama. Lorenzo has yet to announce details of an airdrop or TGE.
10. Build on Bitcoin
TVL: $103 Million
Build on Bitcoin, aka BOB, calls itself a hybrid layer 2 network powered by Bitcoin and Ethereum. The protocol aims to unite key elements of Bitcoin such as its liquidity with the technological features of Ethereum, namely EVM capability and smart contracts.
Points in BOB’s offchain incentive program to track mainnet activity are referred to as “spice,” a nod to Frank Hubert’s cyberpunk sci-fi book Dune, of which BOB’s founding team are fans, the protocol’s co-founder Alexei Zamyatin told Unchained.
The official points program is currently in its final season with the first season having started in March 2024. Users can “harvest spice” through a number of ways such as depositing into applications on BOB, inviting friends, and completing quest campaigns.
Moreover, spice is “an early stage of governance experimentation,” Zamyatin said. Spice calculates an address’s voting power from which they can vote on their favorite dApps each week. While information about BOB’s potential token generation event has not been disclosed, users in the protocol’s Discord server are often asking questions about airdrops. A moderator who goes by @femiyoghurt said on Tuesday, “Concerning airdrops, we’ve got no information on that [at the moment].
Powered by WPeMatico
