Crypto Assets users tend to seek instant gratification

Crypto Assets users typically exhibit a higher propensity for instant gratification and a lower discount rate, which means they prefer immediate satisfaction over long-term rewards. This finding comes from a recent survey conducted by a research institution.

The hyperbolic discounting model helps to understand the tendency of individuals to prefer immediate rewards over future gains. This model is characterized by parameters such as immediate inclination (ꞵ) and discount coefficient (𝛿), which is particularly evident in the volatile and speculative Crypto Assets market.

The results of this study can be applied to optimize token distribution strategies, such as for early user rewards, decentralized governance, and airdrops for promoting new products.

In the field of Crypto Assets, airdrops have become a multifunctional tool. They are not only used to reward early users and implement decentralized protocol governance, but also to promote new products. Establishing distribution standards has become an art, especially when determining the reward recipients and their contribution value. In this context, the quantity of tokens distributed and the unlocking time (usually achieved through mechanisms such as vesting or gradual unlocking) play a crucial role. These decisions should be based on systematic analysis rather than relying on guesswork, emotions, or other precedents. Adopting a more quantitative framework can ensure the fairness of airdrops and strategically align them with long-term goals.

The hyperbolic discounting model provides a mathematical framework for exploring how individuals make choices involving trade-offs in returns over different times. This model is particularly applicable in areas where impulsivity and inconsistency significantly affect decision-making over time, such as financial decisions and health-related behaviors.

The model is driven by two specific population parameters: instantaneous propensity ꞵ and discount factor 𝛿.

Instantaneous preference ꞵ measures an individual's tendency to prioritize immediate rewards over long-term rewards. It varies between 0 and 1, with a value of 1 indicating no instantaneous preference, reflecting a balance towards long-term rewards and an assessment of temporal consistency. As the value approaches 0, it indicates that the instantaneous preference becomes stronger, meaning a greater preference for immediate returns.

The discount factor 𝛿 measures the rate at which the value of future returns decreases as the realization time increases, reflecting the natural decline in perceived value over time delays. The discount factor is quantified more accurately over longer intervals, spanning multiple years. When assessing two options over a short term (less than a year), this factor exhibits considerable variability due to the disproportionate influence of the immediate environment on perceptions.

For the general population, research shows that the discount factor typically hovers around 0.9. However, among groups with gambling tendencies, this value is often much lower. Studies indicate that the average discount factor for regular gamblers is usually slightly below 0.8, while for compulsive gamblers, the discount factor often approaches 0.5.

A survey conducted by a research laboratory indicates that a representative sample of Crypto Assets users exhibits an immediate inclination slightly above 0.4 and a significantly low discount rate. This means that Crypto Assets users have a higher immediate inclination than average, while the low discount rate suggests that they may lack patience and prefer immediate gratification over future gains.

This phenomenon can be attributed to several interconnected factors in the Crypto Assets market:

1. Periodic Market Behavior: The Crypto Assets market is known for its volatility and periodicity, with token prices often experiencing rapid fluctuations. This periodicity influences user behavior, as many traders are accustomed to frequent trading during these cycles, rather than adopting the long-term investment strategies more common in traditional finance. Frequent rises and falls may lead users to underestimate the future value of tokens, fearing that potential downturns could erase gains.

2. Bias Against Tokens: The survey specifically asked cryptocurrency users about their perceptions of the future value of tokens to reveal their deep-seated biases related to token trading. This prejudice is related to the cyclical and speculative nature of token valuation, further deepening their cautious attitude towards long-term investment in the crypto assets space.

3. The Speculative Nature of Crypto Assets Applications: The current crypto assets ecosystem is deeply rooted in speculation and trading, characteristics that are commonly found in the most successful applications. This trend indicates that the vast majority of current users tend to favor speculative platforms, and survey results reflect this, showing that users strongly prefer to gain immediate economic benefits.

Although the research findings may differ from conventional human behavioral norms, they truly reflect the characteristics and tendencies of the current Crypto Assets user group. This distinction is particularly important for projects that need to design airdrops and token distributions, as understanding these unique behaviors helps to plan more strategies and design better reward system structures.

For example, using the method of a certain perpetual product exchange, the team recently introduced a delayed reward mechanism when launching its native coin, offering double rewards for users who wait 6 hours after the coin issuance to claim the airdrop. The purpose of this mechanism is to alleviate the congestion caused by bots at the start of the airdrop and to help stabilize the coin's performance by reducing the initial surge from sellers.

The results show that only 15% (at the time of writing) of airdrop claimants chose not to wait 6 hours to receive double rewards. According to the research findings, if the reward value is doubled, the exchange could extend the waiting time to several months, and statistically, this should be able to appease most end users.