Airdrop farmers, also known as squatters, are making headlines after a Friend.Tech whale dumped over 55K of the newly-issued FRIEND tokens, as on-chain data shows.
Within hours of the airdrop launch on May 3, blockchain data revealed that “Murphys1d,” the largest holder, sold over 55,000 tokens. The problem is the massive sell pressure that followed, with the token plummeting to new lows and users facing issues claiming the airdrop.
One investor, Luke Martin, expressed frustration over the situation.
Watching the value of my airdrop go from 7 figs to 5 figs in the span of 2hrs while I keep refreshing the page trying to claim….still can’t claim.
Meanwhile I gotta watch this guy cashout while my wallet won’t even load.
Adds insult to injury 💀💀💀
— Luke Martin (@VentureCoinist) May 3, 2024
Martin noted that the whale wallet appeared linked to a fake X (previously Twitter) account, allowing the user to accumulate over 500,000 Friend.tech points without risk by using. This whale is known as an airdrop farmer, who most likely connected multiple wallets into the protocol to compound rewards.
Since its launch, the Friend.Tech token has plummeted by 52.5%, dropping from $3.26 to $1.32 as of 9:50 am UTC.
Token airdrops have become massively popular in the crypto community. They are a simple yet effective marketing technique that incentivizes user participation and rewards them for their time and loyalty to the protocol.
However, the rewards are often lucrative, leading to the growing community of airdrop hunters (also known as farmers). It refers to one or multiple users who are often looking for protocols that might airdrop in the near future and decide to join the protocol in order to receive rewards, once the airdrop is officially announced.
Airdrop hunting has become a repudiable practice, as whales have figured out that they can leverage scripts or bots to create a massive number of fake accounts on a given protocol, soaking all the rewards and leaving early users out of the game.