Collectible NFTs are fueling community engagement in the cryptocurrency space.
- POAPs are one-of-a-kind proof-of-attendance NFTs that have been verified on the xDai sidechain.
- Many crypto communities have begun to distribute POAPs in order to engage with their members.
- POAP collections can also serve as decentralized identities, opening up new avenues for their application.
POAPs are one-of-a-kind NFT badges distributed to attendees of both virtual and real-world events. While POAPs can be used to keep a record of your life experiences, others envision POAPs playing a much larger role in the digital economy in the future.
Proof of Attendance Protocol (pronounced poh-ap) is an abbreviation for Proof of Attendance Protocol. These NFT badges are given out to prove attendance at an event, whether it was virtual or in person. Because each badge is unique, the only way to obtain a specific POAP is to attend the event. Collectors can quickly amass a one-of-a-kind collection of POAPs that document their experiences and travels in the crypto space.
The ERC-721 standard, which is used for NFTs, is used to create all POAPs. However, in order to be classified as a POAP, an NFT must meet a set of criteria. It must first be minted using the official POAP smart contract. Second, it must include metadata pertaining to a specific time or date, which can be up to a year in length. Finally, all POAPs must be associated with an image.
POAPs were initially created and distributed on the Ethereum main net, but since October 2020, they have been created and distributed on the Ethereum sidechain xDai. POAPs can be minted for very little cost by issuers because xDai is designed for fast, low-cost transactions. As a result, POAPs are typically distributed for free to those who are eligible to receive them.
POAPs can also be transferred from xDai to Ethereum if the user pays the gas fee. However, due to the high fees associated with Ethereum, most users prefer to leave their POAPs on xDai, where they can be viewed using the POAP app. Although POAPs appear to be staying on xDai for the time being, Ethereum co-founder Vitalik Buterin has hinted that they may be moved to optimistic rollups in the future.
POAPs have been distributed at over 100 Ethereum community events to date, including EthGlobal, Dappcon, and the recent Ethereum Community Conference in Paris. Over 7000 POAPs were claimed across these events, resulting in a verifiable attendance record stored on the blockchain.
POAPs are also being used by several online crypto communities to engage with their members. DAOs such as SushiSwap and ShapeShift give out badges to people who attend weekly community meetings, participate in AMAs, and vote on governance proposals. In other news, popular metaverse game Decentraland regularly distributes POAPs to commemorate in-game events, such as MetaMask’s recent 10 million user party.
POAPs were also used in the animated web series Stoner Cats and the NFT project Stoner Cats. Many people who attempted to mint a Stoner Cat had their transactions fail due to a poorly written smart contract, costing users a total of $790,000 in gas fees. To compensate those affected, the Stoner Cats team distributed a limited edition Rekt Stoner Cats Minters POAP and refunded failed transactions’ gas fees.
Why Do People Collect POAPs?
While these blockchain badges are certainly entertaining to collect, they may also have greater untapped potential.
One example is that the number of POAPs in a user’s wallet can be used to measure engagement and time spent in a community. POAPs were used earlier this year by the Bankless DAO to help allocate funds for its subscriber airdrop. The DAO decided to distribute tokens to wallet addresses that had previously claimed Bankless POAPs, with more POAPs equaling a larger share of the airdrop.
Other communities that issue POAPs are also working on collecting incentives. SushiSwap has begun to offer POAP holders benefits such as the ability to draw faster on collaborative community artworks, which are then distributed to participants as fractionalized NFTs. While this may not appear to be much in comparison to a full-fledged token airdrop, Sushi POAPs can be claimed by anyone attending its events, whereas the Bankless DAO only distributed POAPs to paid subscribers.
An individual’s POAP collection can be viewed as a highly reliable, decentralized identity in addition to measuring engagement through the number of badges collected. POAP issuers must ensure that those attending events do not receive more than one POAP and that non-attendees do not receive them in order for this to occur. As long as issuers act as trustworthy oracles, each POAP issued strengthens and validates all POAP collection identities.
Users have identified practical applications for blockchain badges by viewing POAP collections as decentralized identities. SushiSwap AMA host 0xTangle, for example, has spoken with Sushi community members about using POAPs as a kind of blockchain résumé. Employers in the crypto space can use an applicant’s POAP collection as a reliable record of their involvement in a community when hiring. This is extremely useful when hiring people for self-governing, community-driven entities like DAOs, which must ensure that everyone working for them is aligned with the organization’s goals.
Since the project’s current version was released on xDai in October 2020, the use of POAPs has steadily increased. Users have only scratched the surface of POAPs’ potential applications, with suggested applications such as social graphs and under collateralized loans yet to materialize. POAPs have the potential to help redefine identity in crypto, with limitless applications and a low barrier to entry.