Announcing Support for Participatory Airdrops, Including Edgeware Signaling

Diogo Mónica, Co-founder and President

Anchorage now supports Edgeware signaling with assets in custody: Anchorage clients who hold Ethereum can participate in signaling to claim an airdrop of the Edgeware governance token, EDG.

Anchorage’s smart storage architecture enables using private keys from custody without human operations that expose assets to risk or compromise exclusive control. As a result, we can support airdrops requiring the use of private keys for participative mechanisms like signaling, among others. Our clients are able to claim additional tokens — and thereby generate additional yield — at no cost, with the tap of a button.

What are participatory airdrops?

When a new asset launches, the organizers must decide how to distribute the asset to users. To ensure the asset is distributed fairly among a large number of different users, and to prevent individual buyers from snapping up too large a share, new blockchains commonly use airdrops to distribute the new asset among holders of an existing asset. Some may allow these existing asset holders to opt in to receive an airdrop, while others may distribute the airdrops randomly and unsolicited across a set of addresses. In many cases, asset holders must use existing private keys to claim the airdrop in some way. Airdrops requiring use of private keys are considered “participatory.”

What is Edgeware signaling?

Signaling is a form of airdrop that enables holders of an existing asset (in this case, Ethereum ETH) to “signal” their holdings to Edgeware and receive a share of EDG proportional to the total amount signaled, for free. Notably, Edgeware signaling does not involve locking up ETH via a smart contract: instead, to qualify for a distribution of EDG, ETH holders use their private keys to sign a message that signals their interest.

Edgeware is slated to launch initially as an independent solochain built in the Polkadot ecosystem, with the goal of becoming complementary with and inter-operable on both the Ethereum and Polkadot networks. As Edgeware’s governance token, EDG will be used in Edgeware’s native voting mechanism, as the bonding and reward token for Edgeware validators, and as payment for Edgeware smart contract gas fees.

How it works

Timing:

• The Edgeware signaling program will be live until August 31, 2019 11:59pm UTC (known as the “lockdrop contribution period”). This means Ethereum holders have only until the end of the current month to claim EDG tokens proportional to their ETH holdings.
• To participate in signaling, Anchorage clients must provide us with their Edgeware public key. We will then signal their corresponding Ethereum address(es) before August 31, 2019 11:59pm UTC. Note: each ETH address may be used only once for signaling.
• The network launch is slated for September 15, 2019, at which point those who have participated in signaling will receive 25% of their proportional share of the EDG token.
• The remaining 75% of the proportional share of EDG tokens will be distributed to participants one year after the network launch.
• Note: The proportional amount of the EDG token issued to those who participate in signaling will be less than the proportional amount issued to those who participate in the lockdrop.

Features:

• Signaling is a first-class feature available through the Anchorage user interface. Anchorage clients will be able to take all necessary actions to participate in signaling directly from the Anchorage platform.
• Anchorage’s architecture enables us to sign signaling operations programmatically and without manual operations that expose keys to risk, so clients won’t face any trade-off between the security of their assets and generating additional yield through on-chain signaling.

Greater security and usability, with operations built to scale

The Anchorage platform is safer than cold storage, and enables secure on-chain participation so that institutional investors can get the most leverage out of their assets. Participatory airdrops, which allow investors to generate additional yield by accumulating new assets, highlight the fact that cold storage is holding investors back as crypto moves forward:

• It is time-consuming and impractical for cold storage custodians to manually retrieve each private key needed for signaling, especially at scale across all clients.
• Participating in signaling via a cold storage custodian may compromise asset security and inhibit the custodian’s ability to maintain exclusive control. Once a private key is retrieved from cold storage and used for signature — which in almost all cases exposes the key to some degree, if only in the memory of a laptop — all associated assets should be moved to a fresh address whose private key has never been exposed, and the previous private key should be discarded. But in order to receive EDG from Edgeware when the distribution takes place, the associated ETH address must remain consistent from signaling onward. This means the client must use the same private key for both the signaling and the custody of ETH while participating. Using the same private key both for custody and for Edgeware signaling activity compromises the security guarantee for cold storage users and may indeed be impossible.

By contrast, the Anchorage platform’s innovative use of HSM technology does not require human operations to execute key signatures once the operation is approved (enabling timely signing at scale), and does not require discarding private keys after use, since the private keys never leave the HSM hardware.

To learn more about how Anchorage can help support your needs regarding Edgeware signaling or any other forms of on-chain participation, please get in touch.

Services are offered either through Anchorage Hold LLC, a Delaware limited liability company and registered Money Services Business, or Anchorage Trust Company, a South Dakota-chartered trust company. Anchorage Hold and Anchorage Trust Company are not registered with the SEC. Services are not yet offered to residents of New York. Anchorage Hold and Anchorage Trust Company do not engage in the offer or sale of securities or digital assets, and do not provide legal, tax, or investment advice. Anchorage Hold LLC and Anchorage Trust Company are wholly-owned subsidiaries of Anchor Labs Inc., a Delaware corporation headquartered in San Francisco, California.