Solana project with $1bn in deposits aims to reward ‘true believers’ with its airdrop – DL News

The Solana community is praising liquid staking protocol Sanctum after it revealed details for its token launch and promised to ditch the predatory tactics that have marred other launches.

Sanctum said it will airdrop 10% of its tokens to early users, set aside another 30% for its community, and sell 8% through a public onchain sale.

“Projects in the past started with so little and launched with crazy inflated FDVs,” Sanctum co-founder FP Lee in an X Spaces stream outlining the launch. “We don’t want that. We want to start low and go up.”

Lee was referring to fully diluted valuation, — or FDV — the total value of a token’s supply, including those locked or yet to be distributed, and not just those that are circulating.

Sanctum also said it previously sold 13% of its token to investors, a relatively small amount compared to other projects, and reserved 25% for team members.

“It’s well done, and well-balanced between team, investors, and community,” Kasper Vandeloock, CEO of crypto trading firm Musca Capital and advisor to several DeFi projects, told DL News.

“It signals they are here for the long term, and launching a token is not them trying to find exit liquidity.”

Defi users have pushed back against projects employing what many call predatory “low float high FDV” token structures that benefit early venture investors.

Sanctum lets users stake SOL tokens and receive placeholder tokens in return, which can be used in DeFi.

It differs from other liquid staking protocols by grouping more than 32 different liquid staking tokens into a single pool of liquidity, giving traders better prices when swapping between them.

Sanctum has just over $1 billion in deposits, according to DefiLlama data.

Sanctum’s CLOUD token

Sanctum’s CLOUD token will let holders govern the protocol, similarly to a decentralised autonomous organisation — or DAO.

But it will also have other uses, like as a collateral token that prospective partners would need to stake.

Sanctum’s token plans are largely inspired by decentralised exchange aggregator Jupiter, said Yash Agarwal, a researcher at Superteam, a group that helps Solana ecosystem projects.

Jupiter allocated 40% of its token to its community through airdrops, and only a small amount to VCs.

“It’s also unique compared to other Solana projects, which typically have 10% to 15% in airdrops and 20% to 40% allocated to predatory VCs, launching at astronomical high FDVs,” Agarwal told DL News.

Sanctum will use Jupiter’s launchpad to conduct its token sale.

Several Solana projects have chosen to launch tokens through the launchpad as an alternative to launching through crypto exchanges.

“Centralised exchanges almost always ask for large listing fees: 1%, 3%, 10% of total supply,” FP Lee said in his X post announcing Sanctum’s CLOUD token. “I would much rather those tokens go to the Sanctum community.”

However, Lee said, Sanctum is giving a comparable amount — 1% of the token supply — to LFG, the organisation that runs the launchpad.

Additionally, CLOUD’s initially circulating supply, while bigger than many recent airdrops, is still low.

Top decentralised exchange Uniswap airdropped 60% of its UNI token to early users in 2020, while the Ethereum Name Service airdropped 25% of its ENS token in 2022.

‘True believers’

Sanctum also said it wants to improve on previous airdrops by separating airdrop farmers from “true believers.”

Sanctum’s Lee said he wants to keep details of the project plans secret to avoid giving a head start to those trying to game the system.

He did, however, say that Sanctum could delay airdrop claims, or reward recipients who choose to delay their claim with more tokens.

Tim Craig is a DeFi Correspondent at DL News. Got a tip? Email him at tim@dlnews.com.