As published on Decrypt
In the blockchain ecosystem, instead of paying workers with real money, it’s common practice for startups to offer ‘airdrops’, or ‘bounties’ in the project’s native token to people looking to make a few dollars for being fans of the project. By hiring out an army of commenters, memers, retweeters and vloggers to promote the network, startups create buzz and a community that hopefully, will increase their chances of success. There’s evidence it works. When Sharesome, an adults-only social network airdropped over 1 billion Flame Tokens (XFL) in December 2018, over 150,000 signed up for the airdrops, and 23,000 joined the Telegram group, within 48 hours.
And the best bit for blockchain start-ups? “They’re actually paying nothing, because compared to fiat money, token creation is free,” Mike Sergeev, senior communications manager at KICK ECOSYSTEM a platform designed to help the token gathering process in airdrop campaigns, told Decrypt. Instead of cash, bounty hunters work on the hope that the tokens they earn will be worth a lot of money when they launch on an exchange.
Those who can navigate this highly unregulated economy can get rich quick: If a native token soars in value, a few retweets and comments a week could lead to a cashout in the thousands of dollars; a considerable sum for bounty hunters, many of whom live in developing countries, where a day’s wage can be less than $5. Abu Bakkar Siddik, a bounty hunter from Bangladesh, told Decrypt he made enough from the Kick ICO airdrop to buy a house.
Abu Bakkar Siddik made enough from the Kick ICO airdrop to buy a house. PHOTO CREDIT: Kick ICO
But liars and scammers roam wild in the blockchain economy, and bounty hunters have few options if a project suddenly disappears. It’s not uncommon for bounty hunters to have to wait months after completing tasks, more than enough time for a company to fail or for the founders to run off with the money. In some cases, bounty hunters are left with pennies for months of hard work. Ayub Emon, a bounty hunter, also from Bangladesh, told Decrypt he’s wasted around 3 or 4 months on airdrops, with some payments up to 300 times less than the ICO price, or, worse, no payment at all.
But the strategy is now so popular, and so lucrative, that many have started bounty hunting for tokens full time, in the hope of token riches. The Stellar Foundation, for instance, recently announced it would airdrop 2 billion XLM tokens, currently worth $120 million today, over the next 20 months. A cottage industry of bounty hunting websites have sprung up, some recording more than a million hits a month. In little more than five years since the first airdrop went live–for the now useless Auroracoin in 2014–what started out as a marketing tactic has turned into big business. Decrypt spoke to those who had dedicated themselves to making money out of thin air.
Living on Thin Air
Oladele Olanrewaju, 33, from Nigeria, became a bounty hunter after the cryptomarket crashed in early 2018. He’d lost money trading alt-coins and wanted a way to recuperate his costs.
Olanrewaju started marketing for Hydro, a project that uses blockchain for financial security. His job was simple: Create buzz around the project by retweeting links, posting memes, or making YouTube videos. Olanrewaju received the bounty in Hydro’s native token. He received 222,222 Hydro tokens in late 2017 before the token went on the exchange. The price shot up when Hydro launched in April 2018, and Olanrewaju made $1500. A good thing too, had he waited until today, Hydro is now worth just $0.0007.
“I can boldly say what I earned monthly from airdrop is more than I could earn in 3 months working as a civil servant,” said Olanrewaju.
Olanrewaju now spends up to 8 hours a day working on airdrops. His previous job, a web developer, has since been relegated to a side-hustle. Olanrewaju finds most of his work on Telegram and WhatsApp, where groups of thousands of eager bounty hunters await their daily tasks.
It’s endless work; Olanrewaju said he’s constantly glued to his phone dawn till dusk.
And as the ICO market bottoms out, Olanrewaju said the money’s fallen along with the crypto market, but he still makes around $150 a month.
Moving up the chain
Ayub Emon, 23, is a chemistry undergraduate student studying at Feni Government College University in Bangladesh. He told Decrypt he’s been working in the airdropping industry since 2017. He spends around 3 days a week managing bounty hunters as part of social media campaigns.
Between 2017 and 2018, Emon made $25,000. One of Emon’s most successful campaigns, Dago-Mining, invovled marketing a green coin that promises to mine its token with solar power.
Ayub Emon made $25,000 from bounty hunting between 2017 and 2018
To get the tokens, bounty hunters had to, for instance, follow a certain page on Facebook from an account with over 500 friends, and post several times a week, for two months, with the hashtags #ico #DAGO #eth #btc #greenmining #bitcoin. Do that, and you’ll net yourself 5 stakes a week—even more if you have more Facebook friends.
Stakes are the proportion of the total airdrops a bounty hunter receives. Say 4 million tokens are given out in the airdrop, and the total number of stakes is 32,000. With those 5 stakes gained in the Facebook campaign each week, they’ll end up with 125 Dago Tokens, which they can sell as soon as the coin launches on the exchange.
But fast forward to 2019, and the glory days of token hustling are over. Emon has made just $3,000 in 2019.
“2019 is not a good year. Most of the ICO’s were failed or scam[s],” he told Decrypt. He says he’s wasted around 3 or 4 months from scammers, with payments up to 300 times less than the ICO price, or, worse, no payment at all.
Diego Santos, a 32-year-old IT professional and bounty hunter, has spent weeks working on projects, only to realize that he wasn’t getting paid or that the founders had since abandoned the project, having made off with cash they raised through fundraising rounds.
To expand their reach, blockchain start-ups need documentation, like whitepapers, translated into as many different languages as possible. Santos told Decrypt he took part in a whitepaper translation bounty in May 2018, and was promised 2,000 stakes of the bounty, worth around $6,000 at the time. Santos dedicated two weeks on the project, translating over 100 pages into his native Portuguese, only to realize at the end of the campaign that the company had failed. Officially, the funds are “on hold,” but Santos isn’t holding his breath–the project never even hit the exchanges.
In another project, for worldwifi.io, a decentralized free wi-fi network, Santos spent a week creating Telegram stickers for the company for a bounty worth around $1,500. He received the funds in April 2018, two months before WeToken hit the exchanges. As soon as the coin went live, bounty hunters sold and the price plummeted–Santos said this is likely because bounty hunters who received small bounties had no incentive to HODL. Now, Santos’ $1,500 is worth just $3.
Santos created stickers for WorldWifi’s marketing campaign
But the tide can turn in an instant: in one airdrop campaign, also in May 2018, Santos built a few stickers on Photoshop for Credits’ Telegram campaign and earned over $4,000 in less than 3 days. In Brazil, that’s almost a year and a half of the country’s minimum wage. Such is the allure of airdropping.
Santos’ sticker was used in credit.com’s Telegram sticker package.
But unlike others, Santos is playing it safe: he’s not giving up his stable job at an IT firm for airdrops just yet.
A lack of responsibility?
KICK ECOSYSTEM, which started in Russia in 2016, is made up of bounty hunting experts, and offers advice on how companies ought to conduct campaigns. Its new exchange, KICKEX, allows companies to make campaigns directly within its platform (normally you have to visit bounty hunting sites).
KICKEX does its best to confirm that the project is legitimate, by verifying the identities of the team members, and looking up their experience. But, despite this, “things can go in any way and it does happen that some projects collect money and don’t do anything about their token,” said Mike Sergeev, senior communications manager at KICK ECOSYSTEM.
“It is up to anyone to participate in any project. Everyone has to do thorough due diligence and research before entering; there are many scams and not many rightful people behind the projects,” he told Decrypt. But is it reasonable to expect a bounty hunter from the depths of a Bangladeshi slum to produce an accurate economic model of some Silicon Valley brainfart? Absolutely not.
To make money, bounty hunters must hedge their bets. The thing is, most bounty hunters “don’t have to do a lot of really hard work. It is all done through mostly social media,” said Sergeev. “The airdrops are so simple that you can do ten airdrops a day…even if [the value] of nine out of ten tokens goes to zero, and one goes up, you’re still a winner.“
As ICOs fail, some are turning to referral schemes to get their cash. But payment is no more certain: KICKEX, for instance, immediately credits a cool $20 worth of KickTokens to anyone who signs up, but users can only cash out when its KICKEX exchange launches in Q4 2019.
So, can you get rich? “Maybe, who knows when the next bull market arises,” said Santos.