HomeDeFiLayerZero: the controversial Anti-Sybil strategy

LayerZero: the controversial Anti-Sybil strategy

Recently, several tensions in the DeFi ecosystem have emerged due to the anti-Sybil strategy adopted by LayerZero

So far, LayerZero has identified approximately 800,000 addresses potentially linked to Sybil practices, however, this process has created disagreements among some members of the community. Let’s see all the details below. 

LayerZero and the fight against token farmer

As anticipated, LayerZero, a protocol for cross-chain interoperability, is preparing for its first token airdrop, but its strategy against token farmers is generating disagreements.

The main concern is about LayzerZero’s “anti-Sybil strategy”. It aims to counteract Sybil activity, where groups or individuals create multiple wallets to qualify multiple times for token airdrops.

However, this action is causing controversy because the protocol seems to stigmatize even legitimate applications like Merkly, a decentralized app (DApp) for cross-chain bridging.

Despite LayerZero presenting Merkly as part of its “ecosystem” of applications, it has also labeled it as a “Sybil farming application”.

In an interview with CC2, a prolific airdrop farmer and consultant for Merkly, he expressed understanding for LayerZero’s concerns but also highlighted the importance of Merkly as a value-added tool in the sector.

CC2 criticized the Sybil hunting campaign conducted by the CEO of LayerZero, Bryan Pellegrino, questioning its necessity and suggesting that it might exclude legitimate farmers with few wallets.

This raises questions about the effectiveness and fairness of LayerZero’s anti-Sybil strategy and the implications for the DeFi community as a whole.

The hunt for LayerZero’s Sybil: divisive or necessary?

Even though the hunt for the Sybil of LayerZero has caused discomfort in some, it has received praise from other members of the community.

Bryan Pellegrino has emphasized that this action is designed to ensure that airdrop tokens are sent to authentic users, highlighting that for LayerZero “users come first.”

The platform refers to these users as “utenti durevoli”, as it is expected that they will continue to use the platform even after the conclusion of the airdrop.

Moreover, the hunt for Sybil by LayerZero could have a positive impact in the sector, especially among those who hold significant financial resources.

George McDonaugh, co-founder and co-CEO of KR1, emphasized the interest of venture capital firms in the way protocols distribute tokens to their communities.

According to McDonaugh, the best airdrop are those that aim to effectively distribute the tokens to form a community, rather than generating temporary engagement. 

He also noted that the intent to stop Sybil attacks is important to avoid the incorrect distribution of tokens.

Reflections on protocols and identity

LayerZero’s challenges in identifying Sybil farms without alienating significant parts of its community highlight a persistent tension between protocols and users.

One possible solution, suggested by Titus Capilnean, vice president of go-to-market at the digital identification service Civic, could be the introduction of liveness checks. 

This would eliminate doubts about the uniqueness of each user, requiring them to send a simple video feed to confirm their identity. Then using crypto strategies to compare the facial map with an existing database.

Tuttavia, Capilnean riconosce che l’implementazione di controlli di identitĂ  può suscitare preoccupazioni tra gli utenti, che spesso sono riluttanti a condividere informazioni personali o biometriche. 

He emphasized the importance of finding a balance between security and usability for the user.

Capilnean has compared the current situation of Sybil to the early days of the Internet, when advertisers faced uncertainties about the genuineness of ad clicks. 

He concluded by emphasizing the importance of third-party services like Civic to ensure the authenticity of identities in the digital world.

Alessia Pannone
Alessia Pannone
Graduated in communication sciences, currently student of the master's degree course in publishing and writing. Writer of articles from an SEO perspective, with care for indexing in search engines.
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