Participation lies at the heart of the crypto ecosystem. It’s the collective effort of countless participants worldwide that ensures the functionality, security, and growth of decentralized protocols. But beyond it being a mechanism for sustaining networks, participation embodies the very ethos of crypto and why it exists - to increase economic opportunities for every individual.
Earlier this year we launched Quest Protocol, making it easy for anyone to deploy a conditional airdrop for an onchain action. Since then, over quest creators have driven 1.2m onchain actions across 2000 quests via the RabbitHole platform.
We've seen firsthand the power of incentivizing participation and its profound impact on growing networks like Base, Uniswap and more. Our journey doesn't stop here. To continue our quest to promote crypto participation, we are expanding our rewards system to be more inclusive and equitable for all.
Quest Protocol relies on the contributions of several onchain individuals to function and grow. We need a network of participants to create quests, complete them and spread the word–but each relies on the other to thrive and succeed. To strengthen alignment, Protocol Rewards is designed to distribute value equitably to all Quest Protocol contributors.
When a participant successfully completes a quest on RabbitHole and unlocks their reward, a portion of each quest reward is shared with the community and contributors. Here is a breakdown of the shared rewards:
Protocol Fee: A dynamic fee that amounts to 20% of the total reward per quest completion.
Claim Fee: A standard fee that amounts to 0.000075 ETH per quest completion.
The goal is to ensure that every contributor is recognized and fairly valued for their efforts. Here are the key contributors within the Quest Protocol ecosystem and their portion of the shared rewards.
The individuals creating quests are the visionary architects and strategists shaping the landscape of token distribution strategies. They are typically independent contributors or entities that represent an online community, DAO, protocol or agency.
For instance, SixDegree is an analytics agency that works with crypto clients to analyze onchain user behavior. To assist clients like ParaSwap in achieving their business objectives, SixDegree utilizes Quest Terminal, an application built on Quest Protocol, to programmatically launch quests.
Designing and creating quests is a crucial but challenging role. It requires strategically distributing tokens in a way that attracts participants, encourages engagement, and drives meaningful results specific to the network. That’s why incentivizing quest creators like SixDegree is important to encourage innovation and drive demand for protocol participation.
For each successful completion of a quest, the original quest creator is rewarded 10% of the total quest reward (originating from the protocol fee), plus a standard 0.000025 ETH (originating from the claim fee).
While quest creators are the masterminds enabling crypto participation, the individuals completing the quests are the driving force behind protocol growth. Once quests are created, they can be found on gateway platforms like RabbitHole, built on Quest Protocol. This is where participants can easily explore, engage with, and contribute to a wide range of active quests.
Upon the successful completion and verification of a quest, participants are rewarded with the protocol tokens or assets associated with the quest. The reward amount and type differ and is specified within the details of each quest.
However, distributing rewards is more than just about driving short-term growth metrics. Offering token incentives is a strategy for protocols to find and attract potential evangelists. This is the true path to creating a sustainable network: invested participants working collectively towards network expansion.
To spread the widespread adoption of quests, our network of referrers is vital to promoting and expanding distribution. These individuals or entities may be publishers, affiliates, developers or independent referrers.
QuestBot is an example of a referral partner that promotes and drives participants to RabbitHole. Their Twitter bot notifies followers when a new quest has been created and refers them to the platform to complete them.
As a reward, referral partners like QuestBot receive a portion of each quest reward completed through their referral link or platform. For each successful completion of a quest, the referrer is rewarded a standard 0.000025 ETH (originating from the claim fee).
Any individual and entity can create new passive earning opportunities by connecting the best crypto participants to quests. This ensures that Quest Protocol maintains a wide and robust distribution network.
Together, these reward mechanisms power a virtuous cycle of growth and engagement. Rewarding quest creators will encourage the creation of more innovative token distribution strategies, which will attract more participants and promote the growth of protocols.
This marks a departure from popular growth tactics like airdrops that have notoriously failed many protocols. While they are great hacks to generate immediate excitement and boost user activity, engagement is often short-lived and unsustainable.
The flywheel effect of the Protocol Rewards tackles the long-standing challenge of maintaining and nurturing engagement in crypto. By distributing a share of the quest reward to all contributors—including the quest creator, participant and referrer—every role in the ecosystem is incentivized to continuously engage with networks.
As Quest Protocol evolves, we aim to progressively transition governance into the hands of the community members. This means that those who are actively engaged and invested in the protocol’s growth will also become its decision-makers. This will bring us closer to becoming a self-sustained, decentralized protocol most aligned with the collective interests of our contributors.
Protocol Rewards marks a significant stride towards realizing this vision. Rewarding every participant within the Quest Protocol ecosystem supports collaboration, inclusivity, and, most importantly, sustainable growth.
Our next step will be to grant developers access to QuestDK and API to create their own Quest-powered applications similar to Quest Terminal and Rabbithole. This will expand distribution and allow Quest Protocol to flourish into a vibrant ecosystem of applications. Developers will also join in earning Protocol Rewards, opening up new economic opportunities.
To learn more about the Protocol Rewards, read our documentation. If you’d like to become a contributor within Quest Protocol and earn rewards, head to RabbitHole to explore active quests or deploy your own quest on Quest Terminal. If you are a creator, share RabbitHole to earn passive rewards.