Unleashing Growth for DeFi Through Web3 Quests: A Strategic Blueprint
A Guide for a web3 marketer/growth leads on how to leverage the Quest to fuel the growth of their DeFi projects.
The world of Decentralized Finance (DeFi) is one of relentless innovation and fierce competition. As DeFi projects vie for prominence in an ever-expanding market, the need for distinctive and effective growth strategies becomes paramount.
In this context, the integration of Web3 quests emerges as a game-changing approach for DeFi projects looking to differentiate themselves and captivate a broader user base. Technology is not a moat anymore in the DeFi space, it is open source in nature which makes it easier for developers to fork the trending projects and deploy in record time. For example, Uniswap which started in 2017 and quickly became the biggest Decentralized exchange, got forked by Sushiswap. This highlights, that tech is not a moat anywhere but the Brand and Network effect is. This strategic blueprint delves into how DeFi projects can leverage Web3 quests not just as a tool for user engagement, but as a cornerstone for sustainable growth, user education, brand building, and community building.
It aims to not only elucidate the concept but also to inspire a new wave of user-centric, education-driven growth strategies in the dynamic landscape of Decentralized Finance.
Why DeFi Projects Should Use Web3 Quests in Their Growth Strategy?
Incorporating Web3 quests into the growth strategy can offer several benefits to DeFi projects:
Brand Building
To build a moat, branding, and community is essential for your web3 project. A strong brand is built through community advocates, which leads to the creation of user-generated content, including blogs, memes, and videos. Designing quests that amplify UGC and community advocates will help build a good brand and community.
Referral System:
Referrals work like a charm for DeFI protocols. GMX and LIDO are 2 great examples of how to leverage referral in user acquisition. GMX’s referral program contributed to $11 billion in trading value, and generated approximately $11 million in revenue, with $1.6 million distributed in referral rewards. Offering tokens to users upon referral will motivate them to refer their friends and community. Quests like “Invite your friends to earn 100 X tokens when they deposit $100 to the vault” will enhance your referral system.
Enhanced User Confidence
The interactive nature of quests can significantly improve user understanding of DeFi services. This education builds confidence in using the platform, which is crucial for user retention and the overall growth of the DeFi project.
Increased User Engagement and Retention
The gamification of learning and platform exploration through quests makes the user experience more enjoyable and engaging. This increased engagement can lead to higher retention rates, as users are more likely to return to a platform that they find educational and entertaining.
Leveraging the Ecosystem Hype
Whenever a new ecosystem with some utility pops up in the market, it creates a lot of buzz and hype. When such Layer2 launches its Quests, capitalize on that by launching your project’s Quest under the same Layer2. A great example of this is Linea’s Quest campaign on Intract, when they launched their Quests, their projects got over $1.5bn bridge volume by launching their quest under the Linea ecosystem on Intract.
Effective Onboarding of New Users
For new users, starting with DeFi can be daunting. Quests provide a guided, step-by-step introduction to the platform, making the onboarding process smoother and more welcoming.
Resistance to market cycles:
Web3 space is dynamic and hence goes through several market cycles every 3-4 years. It becomes crucial for projects to thrive across these phases by building strong growth systems. Quests can be leveraged well to become resistant to these market cycles. Build loyalty programs through quests that make users stick to the product. Design quests like “ Do 5 transactions, get gas fee rebates” or “Complete X tasks to receive governance tokens”.
Building a Strong Community
Quests that require or encourage community interaction can foster a strong, active community. A vibrant community is a powerful asset for any DeFi project, as it leads to organic growth through word-of-mouth and community support.
Valuable Feedback and Continuous Improvement
Through quests, DeFi projects can gather direct feedback from users, which is invaluable for continuous improvement and innovation. This ensures that the project remains user-centric and responsive to the needs of its community.
How DeFi Projects Can Use Web3 Quests
DeFi (Decentralized Finance) projects can use Web3 quests as an innovative approach to enhance user engagement, education, and retention. Here's how they can implement this strategy:
Educational Quests for Complex Concepts: Create quests that educate users on key DeFi concepts like liquidity pools, staking, yield farming and smart contracts. Demystify your services. Refer to this example of Base ecosystem where they designed Educational Quests on Intract.
Token-Based Rewards to Encourage Platform Use: Integrate native tokens or other incentives into quests. This not only drives engagement but also familiarizes users with the tokenomics of the platform.
Community Challenges for Network Growth: Create quests that encourage community interaction, such as collaborative challenges where users must work together to unlock rewards. Create quests like “invite at least 2 people to unlock a role on discord” or “Invite
Participate in upcoming multi-week L2 alliances on Intract. Launching quests in such multi-week campaign brings a lot of visibility and users to the projects. Every project which launched their quest under DefI Linea Voyage on Intract, on average attracted 40k questers.
Some Community/Project inspired ideas to tinker with
Staking Adventures Quest: Create a quest where users learn and perform staking actions. Reward users with higher yields or special tokens as they advance, encouraging them to explore different staking pools and strategies.
Token Swapping Quests: Design a series of quests that guide users through the process of token swapping. Offer reduced transaction fees or bonus tokens for noobs.
Liquidity Bridging Challenges: Create quests that involve using cross-chain bridges. Provide incentives for completing cross-chain transactions, such as exclusive access to new features or airdrops.
Loyalty Program Quests: Design Quests which helps build loyalty among users. Quests like “Add liquidity to the vault and unlock governance tokens” or “Make 5 swaps a month to receive X NFT”. Such quest make users stick to the project and increases the engagement.
Yield Farming Expeditions: Develop a quest that takes users through various yield farming opportunities. Each level of the quest could introduce more sophisticated farming strategies.
Lending & Borrowing Quest Line: Craft quests that involve lending and borrowing on the platform. Start with simple transactions and escalate to more advanced credit/debt management strategies.
Security and Risk Management Quests: Educate users on the importance of security in DeFi through quests. Include tasks like setting up multi-factor authentication, understanding smart contract risks, and learning about insurance options in DeFi.
Conclusion:
Web3 quests offer DeFi projects an effective tool for user education, engagement, and community building, which are essential components for the growth and sustainability of any DeFi platform. By making complex concepts accessible and engaging, and by fostering a strong user community, Web3 quests can significantly contribute to the success of DeFi projects.
To learn more about how Web3 questing can shape the growth of your Defi platform, connect with Intract or explore our community.