LayerZero’s weeks-long witch-hunting activity officially came to an end yesterday (May 30). Although witch-hunting is a regular part of airdrops in major projects, LayerZero’s elaborate anti-witch campaign has evolved from self-reporting to mutual reporting.
Summary:
LayerZero’s Airdrop Contradictions Behind Witch-Hunting: The Struggle Between Structure and Self-Interest
Background:
What to Know Before LayerZero Airdrop: Reporting Witches Requires a 0.5 ETH, $ZRO Token Economics, Pre-Trading Price?
Table of Contents:
The Intensification of Anti-Witch Activities: From Self-Reporting to Mutual Reporting
The Comical Situation of Reporting
Key Judgments on Witches and Bounty Hunters by Official Authorities
On May 30, LayerZero’s weeks-long witch-hunting activity officially came to an end. Although witch-hunting is a regular part of airdrops in major projects, LayerZero’s elaborate anti-witch campaign turned into a crypto version of the “prisoner’s dilemma.”
The prisoner’s dilemma, a classic case in game theory, is now a true depiction of LayerZero’s airdrop activity. As a highly valued top project, LayerZero naturally became the focus of many users. However, the community did not wait for the “big prize” but instead encountered strict witch-hunting scrutiny.
Earlier this month, LayerZero announced a 14-day self-reporting program for witch activity. As a reward, users who self-reported would receive 15% of the expected token distribution, but this list would not be made public. Users identified by LayerZero as witches who did not self-report would not receive any token distribution.
To appease users and demonstrate fairness, LayerZero later clarified that self-reporting witches was not targeting individual users but rather large-scale witches. LayerZero employees were prohibited from participating in airdrop claims, and violators would be dismissed.
The self-reporting initiative received the participation of many LayerZero users. In the eyes of many multi-account users/studios, it was better to self-report and retain some profits than to receive nothing after being identified by LayerZero. According to data released by LayerZero Labs, during the self-reporting phase, over 338,000 addresses self-reported as witches, and more than 803,000 addresses were preliminarily identified as potential witches. Each qualifying address would receive 15% of the expected token distribution, while the remaining 85% would be returned to eligible users.
However, self-reporting was just the “appetizer” of LayerZero’s anti-witch campaign. The “bounty reporting” made the cleansing activity even more intense.
From May 18 to May 31, it was the hunting season for LayerZero’s bounty. According to LayerZero’s submission page, a total of 3,550 reports were submitted.
However, this hunting activity was full of twists and turns and became a test of human nature. According to LayerZero’s rules for witch hunting bounties, reporters needed to provide at least 20 addresses clearly indicating witch activities. Bounty hunters who successfully reported witches would receive 10% of the expected token distribution, and the remaining 90% would be returned to qualified addresses.
However, if the witch’s address was originally entitled to 0 tokens, the bounty hunter would also receive 0. If multiple reports were made for the same address, the bounty would be awarded to the first reporter. Of course, to prevent users from being “mistakenly killed,” LayerZero allowed addresses mistakenly reported as witches to submit appeals through a form.
The activity immediately received numerous community reports. According to LayerZero CEO Bryan Pellegrino, within a few hours of the start of the bounty activity, they received over 3,000 reports of witches and 30,000 appeals. Due to a large number of spam emails resulting in many GitHub accounts being banned, LayerZero had to announce a temporary suspension of the witch hunting bounty activity two days after it started. Bryan Pellegrino also stated that they would introduce a deposit mechanism, requiring reporters to pledge 0.02 ETH to submit reports.
On May 28, LayerZero Labs announced the reopening of witch bounty report submissions and increased the deposit to 0.5 ETH. The activity would end within 48 hours (8:00 AM Beijing time, May 30). This meant that only addresses providing a deposit would be eligible to submit reports, and the deposit would be refunded after the TGE if the report was honest or successful.
If reports involved stealing others’ achievements, any form of fraud, lack of methodology, or spam, the deposit would not be refunded and would be destroyed. According to Ethereum browser data, LayerZero received over 240 ETH within two days of restarting the activity, which corresponded to approximately 480 reports.
Driven by economic interests, various comical reporting incidents continued to unfold. For example, employees of a studio chose to resign and report internal accounts, a whale address in a project’s airdrop was reported, and users targeted high-value accounts/L2 KOLs and reported witch clusters. There were even rumors that security firm Trusta submitted 470,000 suspected witch addresses to LayerZero, although the firm denied this and stated that they would never report any addresses.
However, this reporting mechanism also caused many users to be “mistakenly injured.” In response to this, Bryan Pellegrino once said that anyone could put anything they wanted into a report, but not every report was valid, and the “irrefutable” standard is actually very difficult to achieve.
An analysis of the LayerZero witch reporting report, published by @vga.eth, pointed out several key points. The official analysis of witches includes:
Clusters with ten, hundred, or thousand addresses engaging in interactions that show obvious traces of fund transfers, such as one-to-many transactions or many-to-one consolidations.
To increase interactions on a chain, cross-chain amounts of $0.01 or less.
Mass minting of valueless NFTs to increase cross-chain interactions, while a small number is inconsequential.
Using popular witch interaction programs like L2Pass.
At the same time, key points for witch hunters reporting include:
Transactions in the same cross-chain direction.
Addresses with consistent contract calls.
All contract interactions have consistent habits and sequences, usually withdrawing funds through the same centralized exchange account, with similar amounts and times.
Minimal interactions on the mainnet and EVM full-chain balance less than $200.
The final witch list is yet to be determined and will be officially announced after LayerZero’s official review. However, according to Bryan Pellegrino’s previous statement, it is expected that only 6.67%-13.33% of the 6 million addresses will be eligible for the airdrop. In response to the latest user questions, he responded, “90%-95% of the reports must be valid, or even more. Of course, bad reports are quickly ‘discarded.'”
As the witch-hunting operation comes to a close, users participating in LayerZero are awaiting a “fateful judgment.”