Solana Name Service Debuts SNS Token, Allocates 40 % for Airdrop

Solana Name Service (SNS.SOL), formerly Bonfida, has recently launched the SNS token and developed a detailed tokenomics strategy. 

Notably, 40% of the SNS token supply is allocated for an airdrop. So, how can users claim their share of the SNS token airdrop? Let’s find out the details in this article.

Solana Name Service Unveils SNS Token

Solana Name Service is a domain name service on the Solana blockchain. This project has officially introduced the SNS token. According to an announcement, this move marks a significant shift aimed at reorienting and better serving the community of .sol domain holders. 

Previously, FIDA focused on supporting the Serum ecosystem, a decentralized exchange on Solana. However, with the growth of SNS and the needs of the .sol community, FIDA no longer aligned with the project’s long-term goals. The SNS token will establish a sustainable incentive system prioritizing .sol domain users.

SNS Tokenomics: Total Supply of 10 Billion

One of the key highlights of Solana Name Service’s strategy is the tokenomics of SNS. It helps to ensure sustainability and encourages community participation. According to the official announcement, the total supply of SNS is 10 billion tokens.

The allocation plan is that 40% of the total supply will belong to early supporters and new users, 20% is for the community’s future, 26.25% will support ecosystem development, 5% will be for liquidity, and the remaining 8.75% will support the project’s core values.

Allocating 40% of the supply to an airdrop is a big move. It aimed at attracting attention and encouraging early user participation. Notably, 20% of this allocation has been reserved for .sol domain holders.

They supported the project through challenging market conditions. This rewards loyalty and serves as a mechanism for SNS to drive broader adoption of .sol domains on a larger scale.

40% SNS Airdrop: Opportunities and Challenges

The 40% airdrop of SNS has sparked significant excitement within the Solana community. According to sns.sol, those who own .sol domains, have built with SNS, or supported the project during bear market periods are eligible to receive rewards from this airdrop. Many X users get SNS airdrops for domains that they bought in 2021.

“A generous 40% of the supply is being dropped to early and new supporters!! I cannot believe I’m about to get a huge airdrop for stuff I bought 4 years ago” shared X user

However, this airdrop also presents certain challenges. With 40% of the total supply distributed for free, mass sell-offs are risky. Airdrop recipients may opt to take profits immediately after the token is listed. The ZORA airdrop is a typical example.

This could exert downward pressure on the SNS price in the early stages. To mitigate this risk, SNS must ensure that liquidity support measures and initiatives to encourage token retention are effectively implemented. 

Additionally, deeper integration of decentralized identity into the Solana ecosystem could help increase long-term demand for SNS. This can reduce selling pressure.

In summary, the launch of the SNS token by Solana Name Service, along with its well-structured tokenomics and 40% airdrop, represents a strategic step to drive the growth of the .sol ecosystem and solidify Solana’s position in the decentralized identity space. However, users should remain mindful of short-term risks such as price volatility and selling pressure following the airdrop.