Help I'm Late To The Party!
Like many new players, I discovered Splinterlands right at the beginning of August. Unfortunately, prices for Splinterlands assets had already exploded at that point with the introduction of the SPS airdrop. Both veteran and new players alike were looking to bolster their airdrop points and earn SPS. DEC saw some insane price movement and is now worth 4x-5x more than it's value in early July.
Prices for land, cards, packs, and other assets have also increased substantially, driven by both demand from incoming players and the desire to earn airdrop points.
The First Ship Has Sailed
Bad news for new investors and players, the most profitable time to invest in Splinterlands has already passed, and rightfully so. Early players of the game should be rewarded for supporting development and taking risks. HOWEVER, the second best time is RIGHT NOW with the introduction of the SPS airdrop. For those of you unfamiliar with the SPS token I highly recommend you read the whitepaper Here . Older players certainly have a large advantage in the airdrop as they have had time to accumulate DEC, build collection power, and acquire assets such as land and card packs. That doesn't mean you should skip out on this amazing opportunity.
What Is SPS And Why It Will Be Valuable And Important
From the whitepaper:
"Splintershards (SPS) is a new cryptocurrency governance token which will be integrated into the Splinterlands game in order to provide increasing levels of decision-making ability and control over the product to the player-base, asset owners, and other stakeholders."
SPS will allow players to participate in the decision making process for many aspects of the game such as:
- Splinterlands-sponsored tournament schedule, settings, and prizes
- Card balance updates
- Quest, season, and leaderboard rewards
- Battle settings (time limits, mana cap, rulesets, inactive splinters, etc.)
- DEC inflation pools
Source
As you can imagine each of these decisions will have large impacts on the game and the economy so of course you would want to be involved in the decision making process. In addition, players have the ability to stake SPS to earn even more. Simply put, the more SPS tokens you have the more votes you have so there is an incentive to accumulate. SPS has a clearly defined use case which adds value and desirability. All dedicated players of Splinterlands should want to own SPS to participate in the game's governance.
How SPS Is Being Distributed And How You Can Accumulate
There are three ways to acquire SPS tokens right now:
- Buy from the open market
- Earn SPS from the Airdrop
- Stake SPS
Which boils down to two different paths of SPS accumulation:
- Buy from the open market -> Stake
- Participate in the Airdrop -> Stake
For the everyday player, SPS is only coming from the airdrop and staking, to my knowledge P2E rewards in the form of SPS have not been implemented yet. As you can see from the chart and table the Airdrop has the most concentrated amount of SPS being released: roughly 33 million tokens per month compared to the 13 million tokens per month from P2E or Staking. I believe that the most efficient way to accumulate SPS is to participate in the airdrop and then stake the proceeds. Below I will explain why.
What Is The Airdrop And How Do I Participate?
Again, from the whitepaper:
"400M SPS tokens, or 13.33% of the total token supply, will be airdropped to players based upon the amount and type of Splinterlands assets held in their account. Rather than have a specific airdrop date/time with a snapshot as is common, SPS tokens will be airdropped to asset holders on a daily basis over a 1-year period. The goal is to encourage players to accumulate and hold Splinterlands assets over a longer period rather than having a big rush up until the snapshot followed by a dump shortly afterwards."
Players earn points simply by owning Splinterlands assets. Based on these points versus the total number of points in the pool players are delegated an amount of SPS each day. Anyone who owns even a few cards or DEC has accumulated a small amount of SPS so far. Here is a breakdown of how to earn points:
If you would like to see a detailed analysis on these different ways to earn points please let me know in the comments!
Why Buying SPS And Then Staking Should Not Be Your First Option
There are a few factors that make this option less appealing than the alternative. First, you are missing out on a whole SPS generation stream. Buying SPS requires either one lump sum investment or the continuous funneling of money into the market. Compare this to the airdrop which earns SPS passively over time, without further investment. After your first lump sum purchase you would rely on staking to continually generate SPS. Unfortunately the staking APR is dropping over time and will continue this trend as more SPS is inevitably staked and time moves on. As I write the SPS staking APR is down from ~320% on 8/9/2021 to ~280% today on 8/12/2021. Second, you are putting all your eggs in one basket. At the end of this strategy you will be left with one big pile of SPS earning a small amount through staking. Compare this with the Airdrop which allows you to diversify your holdings and still earn significant amounts of SPS. Finally, you can't actually participate in the Splinterlands game! SPS is great but they aren't cards or packs which actually let you play the game and enjoy this experience we are all interested in.
The Airdrop + Staking Is King
One of the largest benefits of participating in the airdrop is that you get to diversify your holdings. As shown in the above airdrop chart, there are many different assets which earn points. The airdrop allows you to own something such as land, and still earn SPS through it. The hope is that on top of the SPS from the Airdrop, the land also appreciates or produces value. By spreading out your investment you can hedge yourself from unwanted price movement for an individual investment. Second, you can compound your SPS earnings through staking. After your initial investment to generate Airdrop points you can stake your earned SPS to generate even more. By continuing to reinvest your Airdropped SPS and your staked SPS you can compound the amount of SPS you own! Finally, you can buy Splinterlands assets that you can actually play with and use or assets that you think will appreciate in value outside of the Airdrop. A great example of this would be land plots. Each plot of land not only adds 10,000 airdrop points which (by today's math) results in ~2 SPS a day from the airdrop but can also appreciate in value and be productive in future updates!
How To Efficiently Invest For Airdrop Points
I believe this will be a topic for future posts. There are a lot of elements to consider in what is actually the most cost efficient purchase right now versus medium or long term. I can tell you right now however, that purchasing DEC is the most cost efficient way to get airdrop points.
Conclusion
Get your Airdrop points and stake your earned SPS! Now is a great time to employ this method and reap the rewards of compounding gains.
Thanks for reading, if you have any additional questions, comments, or criticisms please drop a comment below!
