Drip Network: Drip, Drip, Drip…
Since July 2021, someone has left the faucet on. Rewards have been flowing out of the Drip Network project for over 9 months now, with no end in sight. The project, including the native $DRIP token, is on the Binance Smart Chain–currently sitting strong, around $32.
So how do we classify the project–Is it a node-project? Not really, money isnt generated through supporting the blockchain. Plus, the project launched 3 months before $STRONG, which is arguably the “father” of the current node-craze. Is it a gamified miner, with unrealistic promises? Well, it’s not really that either. Honestly, it’s kind of neither, but both at the same time. Let’s look at the details…
Let’s start with the promises. The project promises a daily return of 1%, with a max ROI of 365% percent. To open the “faucet” the user must deposit 10 $DRIP into the Drip contract. The rewards pool is maintained through a 10% transaction fee on the $DRIP token, so it’s not solely dependent on investors to keep depositing. In addition, users can garner further rewards through a ponzi like referral system. There is also a built in whale mechanism, which imposes a scalable tax on investors who hold significant percentage of the total supply.
Like I said, kind of like a miner dApp, but with more realistic returns, and features to maintain the rewards. Also kind of like a node project–bonding 10 tokens in return for perpetual rewards. In this case, the rewards have a limit: 365%.
Does this mean it’s sustainable? Based on the performance of node projects over the last 6 months, the Drip Network looks pretty strong. The price surged to a whopping $173/token, in January, but has since dropped to the lower 30s, and has remained steady for the last month. Node projects, on the other hand, continue to plummet. Of course, only time will tell.
In addition to the faucet mechanism, the project provides a staking mechanism for users to provide liquidity to the “reservoir” in the form of drops, which are equal in value to a $DRIP token. Drops provide liquidity for the contract, currently 2833 locked, which equals out to about $260k USD.
I did a quick overview of the contract code, and I noticed one key feature that you don’t always see in contracts, especially rewards-based contracts–TRANSPARENCY. Each section of code contains notes which describe the purpose of each function. There is none of the confusing, nebulous calculations, which are found in most miner contracts. There was nothing negative that struck me, but I will be conducting a deeper dive, and I will surely report back if I find anything interesting.
Most of the projects I write about, I put some money into. As for Drip, I haven’t decided yet. I might watch the price for a few more weeks before turning on my own faucet. I even took a glance at the clone project available on Avalanche chain–Splassive. Remember, this is not investment advice.
What do you think about the project?
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