An airdrop is the uninvited distribution of a cryptocurrency token or coin, usually for free, to a large number of wallet addresses. Airdrops are frequently associated with the launch of a new cryptocurrency or a DeFi protocol, primarily as a means of gaining attention and new followers, resulting in a larger user base and a wider distribution of coins.
What Is Airdrop?
A crypto airdrop is the distribution of digital assets from a cryptocurrency project to multiple wallets. To raise awareness of the project, coins or tokens will be distributed to current or potential users.
These tokens are distributed for free, but some airdrops require users to complete certain tasks before they can claim them. Crypto airdrops became popular during the 2017 ICO boom, and many crypto projects still use them as a marketing strategy today.
About Crypto Airdrop
The airdrop is a promotional activity typically carried out by blockchain-based startups to aid in the development of a virtual currency project. Its goal is to raise awareness about the cryptocurrency project and get more people trading in it when it launches as an initial coin offering(ICO) on an exchange.
Airdrops are typically promoted on the company’s website as well as on cryptocurrency forums, and the coins or tokens are sent only to current holders of crypto wallets, typically bitcoin or Ethereum wallets.
To be eligible for the free gift, a recipient may need to have a certain number of crypto coins in their wallet. Alternatively, they may be required to complete a specific task, such as discussing the currency on a social media forum, connecting with a specific member of the blockchain project, or writing a blog post.
Types Of Crypto Airdrops
As we’ve seen, there are different ways to conduct a cryptocurrency airdrop. Apart from the standard airdrop that simply transfers crypto to several wallets, we have a few other types. Common examples include bounty, exclusive, and holder airdrops.
A bounty airdrop requires users to complete certain tasks, such as sharing a post about the project on Twitter, joining the project’s official Telegram, or creating a post and tagging a few friends on Instagram. To claim a bounty airdrop, you’ll likely be asked to fill out a form with your wallet address and provide proof that you completed the tasks.
An exclusive airdrop only sends crypto to designated wallets. Typically, the recipients have an established history with the project, such as being active community members or early supporters of the project.
What Is NFT Airdrop?
Similar to other types of crypto airdrops, an NFT airdrop credits NFT holders with additional tokens. This is done to build a stronger community around certain NFTs, create buzz, and reward NFT holders.
Are crypto airdrop and ICO the same thing?
Crypto airdrops and ICOs are different concepts, even though they both involve new cryptocurrency projects. While airdrops don’t require any investment from participants, an ICO is a method of crowdfunding.
Conclusion On Crypto Airdrop
Crypto airdrops enable crypto projects to stand out and gain traction in the crypto space. It can also be a good way for crypto enthusiasts to diversify their portfolios with emerging tokens. However, there are likely to be more scam airdrops than legitimate ones, so be cautious and conduct your own research before participating.