What are POAPs and why should you collect them?

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The POAPs to remember are a unique proof of verified NFT presence on the xDai sidechain. Many crypto communities have started distributing POAPs to engage with their members. POAP collections can also function as decentralized identities, opening up new possibilities for their use. Share this article

POAPs are unique NFT badges issued to participants of virtual and real events. While POAPs can be used to keep track of your life experiences, others envision a future where POAPs play a much bigger role in the digital economy.

POAPs explained

POAP (pronounced poh-ap) is the acronym for Proof of Attendance Protocol. These NFT badges are issued to prove participation in an event, whether it took place virtually or in the real world. Each badge is unique, which means the only way to get a certain POAP is to attend the event. Collectors can quickly accumulate a unique collection of POAPs that document their experiences and travel the crypto space.

All POAPs are created with the ERC-721 standard used for NFTs. However, for a TVN to be classified as a POAP, it must meet a certain set of criteria. First of all, it must be issued through the official POAP smart contract. Second, it must contain metadata related to a specific time or date, with a maximum duration of one year. Finally, all POAPs must have an image associated with them.

While POAPs were originally created on the Ethereum mainnet, since October 2020 POAPs have been created and distributed on the Ethereum xDai side chain. Since xDai is designed for fast and inexpensive transactions, POAPs can be issued by issuers at very low cost. As such, POAPs are generally distributed free of charge to anyone who is eligible to claim them.

POAPs can also be migrated from xDai to Ethereum if the user pays the gas charges to do so. However, due to the high fees on Ethereum, most users choose to leave their POAPs on xDai where they can view them on the POAP app. While POAPs appear to be staying on xDai for the foreseeable future, Ethereum co-founder Vitalik Buterin has hinted that they may be hosted on optimistic stacks in the future.

Does @poapxyz think he’s a very early user of optimistic stacks today?

– vitalik.eth (@VitalikButerin) August 13, 2020

So far, POAPs have been handed out at over 100 Ethereum community events, such as EthGlobal, Dappcon, and the recent Ethereum Community Conference in Paris. Over 7,000 POAPs were claimed during these events, creating a provable record of attendance stored on the blockchain.

Additionally, several online crypto communities also use POAPs to engage with their members. DAOs such as SushiSwap and ShapeShift distribute badges to weekly community meeting attendees, WADA attendees, and voters on governance proposals. Elsewhere, the popular metaverse game Decentraland regularly distributes POAPs to commemorate in-game events, such as the recent 10 million user party hosted by MetaMask.

The animated web series and the NFT Stoner Cats project also used POAPs. When the project started, many people who tried to build a Stoner Cat saw their transactions fail due to a poorly drafted smart contract, costing users $ 790,000 in gasoline costs. To compensate those affected, the Stoner Cats team distributed a limited Rekt Stoner Cats Minters POAP and reimbursed gasoline charges for unsuccessful transactions.

Rekt Stoner Cats Minters POAPWhy collect POAP?

While they are certainly fun to collect, these blockchain badges may also have greater untapped potential.

One example is that engagement and time spent in a community can be measured by the number of POAPs in a user’s wallet. Earlier this year, the Bankless DAO used POAPs to help allocate funds for its subscriber jettison. The DAO decided to deposit tokens to wallet addresses that had claimed bankless POAPs in the past, with more POAPs equaling a larger share of the airdrop.

Other communities that issue POAPs are also working on incentives for collectors. SushiSwap has started to introduce benefits for POAP holders, such as the ability to rely more quickly on collaborative community artwork, which is then distributed to participants as split NFTs. While that might not seem like much compared to a full-fledged token drop, Sushi POAPs can be claimed by anyone attending their events, while Bankless DAO has only distributed their POAPs to paid subscribers.

Sushi POAP’s first anniversary

Beyond measuring engagement by the number of badges collected, an individual’s POAP collection can also be viewed as a highly trusted decentralized identity. For this to happen, POAP issuers must ensure that event participants do not get more than one POAP each and prevent non-participants from receiving them. As long as issuers act as trusted oracles, each POAP issued increases the strength and validity of all POAP collection identities.

By viewing POAP collections as decentralized identities, users have identified practical applications for blockchain badges. For example, SushiSwap host AMA 0xTangle spoke with members of the Sushi community about using POAPs as a sort of blockchain CV. When hiring in the crypto space, employers can use a candidate’s POAP collection as a reliable record of their involvement in a community. This is of great value when hiring people in self-contained, community-driven entities such as DAOs, who need to ensure that everyone who works there is aligned with the goals of the organization.

The use of POAPs has grown steadily since the project launched its current version on xDai in October 2020. Users have only scratched the surface of possible uses of POAPs, with suggested applications such as social graphics and secured loans that have yet to materialize. With unlimited applications and a low barrier to entry, POAPs have the potential to help redefine identity in crypto.

Disclaimer: At the time of writing this feature, the author owned BTC, ETH, and several other cryptocurrencies.

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