Ethereum Rollup Optimism Launches DAO, Announces Long-Awaited Airdrop

Crypto Twitter has lit up with users excited to learn they will be eligible to claim Optimism’s OP tokens in an upcoming “season of airdrops.”

AccessTimeIconApr 27, 2022 at 5:53 p.m. UTC
Updated Apr 27, 2022 at 6:14 p.m. UTC

Sam is a reporter at CoinDesk focused on decentralized technology, DeFi and DAOs. He owns ETH, BTC and MATIC.

It’s airdrop season in rollup land.

The popular Ethereum layer 2 rollup Optimism announced on Tuesday that it will be forming a decentralized autonomous organization, or DAO, dubbed the Optimism Collective.

Along with this news, Optimism set Crypto Twitter alight with the announcement of a long-awaited Optimism (OP) token and airdrop.

A “season of airdrops”

Airdrops, like those for the Ethereum Name Service and dYdX, have become a common way for projects to garner attention while rewarding early users and kicking off a token economy.

Unlike big airdrops in the past, however, Optimism announced “an entire season of airdrops” in a blog post on Tuesday. The first airdrop will reward 5% of the initial OP token supply to early Optimism adopters and active Ethereum users (e.g., users who have participated in DAO governance).

Optimism is using multiple rounds of airdrops to encourage people to use or contribute to the protocol even if they failed to qualify for the first drop. Fourteen percent of OP’s initial token supply will be airdropped in total, with eligibility for future drops being determined by the Optimism Collective.

According to Optimism, 264,079 addresses will be eligible to claim OP in the first airdrop, which will be announced on Twitter by @optimismPBC. Users can already check their eligibility status on the Optimism website.

The Collective DAO

According to Optimism, the collective was founded on the premise that public goods can be profitable, and the DAO was designed such that “positive impact to the collective should be rewarded with profit to the individual.”

DAOs have been envisioned as a way to improve organization governance by giving community members a stake in their success, but prominent early examples such as SushiSwap and MakerDAO have found that handing the reins of a project over to a decentralized community of token holders can sometimes lead to slowdowns, messiness and misaligned incentives.

The Optimistic Collective puts a twist on the familiar DAO playbook of allowing token holders to vote on changes to the community by dividing itself into two “co-equal chambers.”

The Token House, which will include all OP token holders, will determine protocol incentives and vote on protocol upgrades. The Citizens’ House, on the other hand, will be made up of “citizens” who hold a non-transferable, or “soulbound,” NFT (non-fungible token) and are responsible for funding public goods.

The first group of citizens includes early Optimism contributors, but the rollup says that over time “the mechanism for distributing Citizenships will be determined by the Foundation with input from the Token House.”

Similar to other teams that have worked to progressively decentralize, Optimism has also formed a centralized foundation to “serve as a steward of the collective” and bootstrap the ecosystem (though it will eventually dissolve, Optimism says).

“Optimistic” rollups

Layer 2 rollups such as Optimism allow users to use some Ethereum apps more cheaply without losing the network’s essential security guarantees. They are the primary way Ethereum is working to scale its ecosystem in the face of high gas fees and relatively low transaction speeds.

Optimism scales the Ethereum network by processing transactions and executing smart contracts on a separate, rollup-specific chain.

The data processed on Optimism gets bundled up and passed back down to Ethereum, where Ethereum network actors can check whether the data is valid.

So-called “optimistic” rollups like Optimism assume transactions are true once they make it to the Ethereum layer 1 chain, and they give network validators a period of seven days to dispute transactions that they believe to be false (That differs from so-called ZK-rollups, which use complicated cryptography to validate transactions rather than assume their validity outright).

With around $500 million in total value locked (TVL) according to DefiLlama, Optimism is the second-largest Ethereum rollup. Its primary competitor in the optimistic rollup market, Aribtrum, has a TVL of $2 billion and has yet to launch its own token.

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Sam is a reporter at CoinDesk focused on decentralized technology, DeFi and DAOs. He owns ETH, BTC and MATIC.

CoinDesk - Unknown

Sam is a reporter at CoinDesk focused on decentralized technology, DeFi and DAOs. He owns ETH, BTC and MATIC.

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