Earlier phases of bull markets have been facilitated by new funding mechanisms. Following the introduction of Ethereum, initial coin offerings (ICOs) allowed anyone globally to invest directly into tokens of their choice. Then in 2017/2018, NFT mints offered a another way for projects to raise funds while providing investors with JPEGs in exchange.
IDOs (Initial DEX Offerings) offer various decentralized ways for crypto projects to raise capital. Through methods like IBCO (Initial Bonding Curve Offering) where token prices rise with increased capital contributions, LBP (Liquidity Bootstrapping Pool) that use dynamic pricing and liquidity management to sell tokens, and IFOs (Initial Farm Offering) that allow users to stake liquidity in exchange for project tokens, teams can effectively fund their operations while distributing tokens to a wide base of users. These mechanisms bypass traditional, costly exchange listings and offer more control over token distribution.
Yield farming, though not a direct funding mechanism, helped protocols bootstrap their liquidity and generate revenues in exchange for token rewards. Airdrops served more as a retroactive reward for early adopters while promoting broader ownership of a crypto assets.
In the previous year , points have came into view as the latest way to bootstrap a project and create liquidity for crypto teams.
Points Mania, the number of protocols with active points programs has exploded in the last 8 months
Initially pioneered by Blur, points systems are a more vibrant and forward-looking approach to airdrops
These programs assign points to users performing key actions such as providing liquidity, referring users and more
Currently the main active points program is EigenLayer's, which has allowed the protocol to reach over $7.8B prior to its Mainnet launch
Following a period of points accruing to users' balances, protocols such as EigenLayer launch tokens through an corresponding to initial points offerings
The points based system for token launches is gaining momentum, with projects like Ethena adopting it from the outset.
The longevity of the current points frenzy is uncertain, but historical trends suggest it could catalyze a fresh influx of capital into the ecosystem.
