It was in a refrigerated “tin shed” just 40 minutes from Ho Chi Minh City that Mirai Labs CEO Corey Wilton finally understood the immense scale by which crypto airdrops are being gamed.
“It’s genuinely scary,” Wilton tells Magazine shortly after visiting a “phone farm” in Southern Vietnam, which he estimates has at least 30,000 smartphones in a room no larger than a studio-sized apartment.
For four years, Winton had been hoping to get a first-hand look at the type of operation that undermined his flagship NFT horse-racing game Pegaxy in 2021.
“When Pegaxy blew up, we were sitting at a max DAU [daily active users] of about 500,000, and at that point, we started getting a lot of reports of botting farms,” Wilton says.
The bots would control a hundred accounts at a time that would snap up high-win rate horses and race them for a chance to win in-game currency, which could then be sold for real money.
“It was like screenshots of someone’s screen with like ten applications on it or 20 applications on it, but you’re also seeing it across social media,” he explains.
Pegaxy pitted players against each other in an automated 15-horse race. Wilton says the bot farms turned his game from “who can win” to “who can extract faster,” — which shifted the vibe of the game and accelerated its eventual demise.
“I recognized pretty early that they’re essentially extracting from our user base […] and it basically set me on a warpath.”
An inside tour of a crypto airdrop bot phone farm
In May, Wilton finally got his wish, getting an exclusive tour of one of these “sophisticated phone farms” in Vietnam thanks to a former Pegaxy player who spotted it on TikTok.
“I went to two locations. It was 40 minutes from where I am, so it’s fairly remote. You definitely don’t have foreigners going there, and they have no interest in anybody knowing,” he recalls.
Wilton describes one of the locations as a tin shed accessible off the street with the air conditioning set to “as cold as possible.”
Inside, the shed is lined with metal racks, each housing thousands of smartphones and leaving just narrow walkways for employees. The setup would resemble something you’d see at a bootleg crypto mine.
“It’s not pretty […] You can even see in the videos, the wire management. Disastrous.”
Wilton said he was shown the “rental arm” of the business, where clients can hire the phone farm for whatever purpose they see fit.
As opposed to traditional bot servers, each device in a phone farm has its own SIM cards and device fingerprinting, and can be set up to spoof IP geolocation, making them harder to detect and useful when systems require each account to be tied to a phone number.
Phones are also relatively cheap for their computing power, and one device failing in the network can be easily replaced without impacting output.
Wilton says that in the example he saw, a human would use a computer to control a master phone connected to over 500 slave phones.
Whatever was done on the master phone would be replicated by all the slave devices.
“Their client list is actually mostly Web2. So you’ve got K-pop labels that are renting it for views, you’ve got casinos that are emulating humans so that it feels like the casino’s competitive, but they’re actually beating you and instigating you to lose.”
“You’ve got Web2 gamers who play mobile games and just do a big farm of it and sell pre-leveled-up accounts,” he adds.
However, Wilton says the main business is actually “manufacturing.”
Crypto airdrop phone farm in a box
The operator would buy old, broken smartphones cheaply and then fix them up with software and other modifications to sell them internationally as a do-it-yourself phone farm.
The project produces over 1,000 farm-ready phones weekly, and each phone farm box contains around 20 phones.
“These guys don’t operate the phones. They are not the ones who are farming airdrops or doing the actions. They’re basically a production line […] so their main business is actually selling it and shipping it internationally to somebody who wants to do it at home.”
“So then you just keep them online and you can buy more phones and just plug it in.”
It’s no wonder bot-assisted crypto airdrop farming has become such a massive problem in the crypto space.
Crypto airdrop farming is the practice of gaming crypto airdrops — usually by creating multiple wallets and spoofing user activity to scoop up free tokens that are meant to reward early adopters. While most…
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