Bitfinex is the first Exchange that honors the OMG airdrop to ETH holders, but what is OMG and an airdrop? Read this article to get the answers!
OMG (OmiseGO) Airdop on Bitfinex.com
Hello Steemians!
As every morning I've checked my lending incomes at bitfinex.com and noticed that I had some OMG tokens in my exchange wallet. To be honest, I never heard about OMG before and was wondering why the heck I received some OMG tokens. I initially thought someone would have send me some tokens by accident and checked my transfer history.
Screenshot of my OMG Transfers at bitfinex.com
As you can see the comment says "OMG Airdrop", which did not help me a lot as I had no idea what is meant by "an airdrop" or what "OMG" is. I've started to google a little bit and decided to share the answers that I have found with you :).
What is OMG (OmiseGO)?
So lets start by talking about OMG itself.
OMG (OmiseGO) is a cryptocurrency and a project that has been initiated by a startup called "Omise" in July 2017. The startup itself has already been funded in 2013 and its operating in Japan, Thailand, Singapore and Indonesia. Omise has the vision to simplify the coordination between Gateways and different financial institutions.
The project is based on the Ethereum Blockchain (ERC-20 Token), but Omise wants to switch to its own Blockchain in the near future.
OMG is the Token behind OmiseGO with is a payment network more or less like Ripple, but with a higher focus on decentralization. The core features are:
- OmiseGo has been built on an already popular product Omise, a payment management platform used in Thailand, Japan, Singapore, and Indonesia
- Decentralized exchange where a user can convert between different cryptocurrencies with very small fee and not dependent on which currencies are being interchanged. As all the transactions are added on the blockchain, there is very less chance of exchange getting hacked as we we have seen with popular centralized exchanges
- Consensus algorithm used is based on proof of stake (POS) instead of proof of work (POW) used in bitcoin, ethereum and other blockchains. So, having more OMG tokens gives you more control over the blockchain transactions and hence more rewards
- Payments are facilitated without needing any bank account. Users need to download the OmiseGO wallet which connects you to their decentralized exchange to power currency conversion real time and to be able pay wallet to wallet across any currency.
The most detailed summary about OMG I have found has been published on the german www.krypto-magazin.de in this article - I hope that you can read it using the google translator. Otherwise the official website https://omisego.network also contains a lot of information and a link to the official whitepaper.
What is an "airdrop"?
The OmiseGO team announced that they will distribute 5% of the OMG tokens to ETH holders - They call this process "Airdrop".
In OMG’s case, 5% has already been set aside from the total issuance (see sale doc), ready to be distributed by an automatic airdrop. That is, sometime quite soon (TBA soon), every address on the Ethereum blockchain that held a balance over a minimum threshold of 0.1 ETH at a recent past block height (TBA soon) will receive a share of this 5% that is proportionate to their share of ETH.
Source: https://www.omise.co/omisego-airdrop-update
Why OmiseGO distribute 5% of their Tokens?
Now that I understood what an "airdrop" is, I was wondering why a company would spend a lot of money - I also found their motivation on their website:
At OmiseGO, we believe that tokens are most useful when they are as widely distributed as possible. In the case of a permissionless proof-of-stake (PoS) network, especially one running a very economically valuable decentralized exchange trading both cryptocurrency and real-world money, a wide distribution is also critically important for network security. Unfortunately, not everyone has the time, opportunity, and technical proficiency necessary to get into the earliest moments of a token generating event. How then can a given token find its way into more hands?
[...]
Still, we believe that introducing to a few hundred thousand account holders the possibility of being PoS validators will ultimately make the network stronger, and we hope it will create interest in OmiseGO and its underlying mechanisms as a new, complimentary construction to Ethereum for chain scaling and interoperability.
Source: https://www.omise.co/omisego-airdrop-update
And to be honest, this worked pretty well. Look at me as an example: I never heard about OMG before and now I am sitting here and writing an article about it. Beside that I guess that this was also the case for a lot of other users, as the price increased over 25% today:
Those people who stored their ETH in their own Wallets already received their OMG Tokens as the original aidrop already happened in the mid of September. (Source: http://finanztalk.org).
Sadly, no exchange respected the airdrop so far meaning that everyone who stored his ETH tokens directly on an Exchange does not received the OMG tokens.
Bitfinex is now the first exchange who added OMG as trading pair and paid out the OMG tokens based on the following rules:
OmiseGO (OMG) tokens will be distributed based on July 7, 2017, 16:36:56 UTC settled ether (ETH) wallet balances. The methodology for determining a “settled” balance includes:
All calculations will use a database snapshot from July 7, 2017, 16:36:56 UTC
All net unhedged ETH wallet balances will receive OMG. For example, if at the instant of the airdrop in July a user had a wallet balance of 5.0 ETH and was short 2.0 ETH/XXX, their net unhedged balance at that moment was 3.0 ETH.
Margin longs in ETH/XXX and margin shorts in XXX/ETH will not receive OMG
Margin shorts in ETH/XXX and margin longs in XXX/ETH will not pay OMG
ETH lenders will receive OMG
Source: https://www.bitfinex.com/posts/omg-distribution
Summary
As you can imagine, I just heard about OMG like 4 hours ago, but I tried to put as much information as possible together and explain, why you may have received some OMG tokens too. I think that there is a lot more to say about OMG, OmiseGO and Omise, but for now it is enough for me to understand what and why I received this night :)
I think the project has a lot of potential and already a big community behind it, so I will for sure checkout the #omisego tag from now on.
Beside that this is no recommendation to buy OMG tokens or to invest in it - I simply do not have enough knowledge about it to suggest something.
Thanks for reading and best regards,
@dez1337
Nice post
Thanks @abdoelhadi