In the crypto world, an airdrop is used as a marketing strategy for new projects who want to promote their project and incentivize the activity of their users. They are often used in campaigns as rewards for tasks such as app downloads, referrals or promoting the brand on social media.
What is a crypto airdrop?
A crypto airdrop is a distribution method to send “free” cryptocurrency or tokens to users’ wallets.
Startup projects in Web3 will usually allocate a portion of their treasury to airdrops to reward their communities for participating and also to further promote their project.
They generate a lot of buzz from excited users. This leads to the gained interest of other people who want to become involved too or want to learn more about the project.
Pros and Cons of Airdrops
Crypto airdrops are not all the same. They differ in amount, value and even impact.
An airdrop is a highly efficient way of encouraging widespread usage of a cryptocurrency or involvement in a crypto project.
For users, airdrops are also a great way to diversify your portfolio without investing your own money. They can help you get into a project early which often has many perks.
Not every airdrop is valuable. Many fraudulent projects promote a fake project with an airdrop to get access to your wallet. When you claim airdrops, you need to connect your wallet to a project’s website. Connecting to a fraudulent site puts your wallet at risk of being hacked and controlled by scammers. Never connect your wallet to an unverified platform.
Different types of airdrops
Depending on a crypto project’s mission, it may choose a certain type of method over another.
The common types of crypto airdrops are:
- Standard airdrop
- Bounty airdrop
- Holder airdrop
What is a standard airdrop?
In a standard airdrop, cryptocurrency tokens are transferred to wallets already existing in a database. The database will contain wallet addresses submitted at an earlier stage.
Generally, all that is required for these airdrops is for a user to make an account on a specific platform and then submit their wallet address.
What is a bounty airdrop?
A bounty airdrop rewards recipients for engaging with the promotional activity of a cryptocurrency project.
The activity could be:
- Reposting, sharing, and liking a post from the project’s official social media accounts.
- Sharing your own post on social media about the project.
- Being active in forums or the community groups, such as on Discord
What is a holder airdrop?
Holder airdrops are distributed to users who hold certain cryptocurrencies or crypto tokens in their wallets. Before the airdrop, a snapshot is taken of your wallet on a specific date. The snapshot will show whether you held the certain crypto coin in your wallet before a certain date so that by the time of the airdrop it is confirmed if you qualify for the airdrop.
How do I qualify for an airdrop?
Depending on the project, there are certain criteria you have to meet to be eligible for an airdrop. Overall, to be eligible for airdrops you need to be active in the crypto space. Airdrops are usually only announced once snapshots are taken of your participation. This is to ensure that they are given to people who are genuinely interested and active with the project.
Although you probably won’t know about future airdrops, you can increase the potential of receiving airdrops in these ways:
- Complete social tasks–such as reposting and liking
- Hold specific cryptocurrencies, tokens or NFTs
- Be an active user of different crypto platforms, services, products and blockchains
- Explore forums and community chats where airdrops may be discussed
How do I find out about upcoming airdrops?
Announced: Sometimes airdrops are announced with a fixed date and timeframe. This method causes the most hype within the community because of the anticipation. Specific tasks can be introduced for users to complete to be eligible.
Unannounced: These airdrops come as a great surprise to customers. They involve capturing multiple snapshots of different criteria. These criteria are typically: participating in activities, using a platform or holding certain tokens.
To keep activity within the user base organic, most crypto projects will keep it a secret if they plan to release an airdrop.