With the constant growth in the number of new cryptocurrencies, crypto investors & traders can’t keep a record of all the new crypto startups using apps like the bitcoin evolution. In such a situation, Airdrops come into play. Crypto Airdrop is a marketing stunt used by crypto initiatives for advertising the latest project or to promote a newly launched digital token. It operates by distributing native coins/tokens among existing or potential customers for free. Sometimes, it requires users to complete easy promotional tasks to claim something in return, like following or subscribing to the social media account of the startup and sharing their activities with friends and family.
There exist multiple Airdrops, and every crypto initiative demands something different. The ultimate goal of all the Airdrops is the same: spreading awareness and increasing the overall interest in the startup. Anyone with a digital or crypto wallet can get an Airdrop, but you have to be cautious about fraudsters. Several scamming Airdrops can drain your crypto wallet when you send or claim free crypto. To cope with this, you have to ensure the lawfulness and legality of the initiative before claiming an Airdrop since all of them are not valid.
What Is A Crypto Airdrop?
A crypto-related marketing strategy that sends a portion of the digital assets of the project to multiple crypto wallets is known as Crypto Airdrop. These assets include digital coins or tokens; that are transferred to existing or potential users to enhance awareness and attract their attention to the project. Usually, a newly started crypto project adopts this strategy and transfers free coins/tokens, but sometimes it demands users perform specific activities to get free tokens. Crypto Airdrop gained fame in 2017 during the ICO, but many crypto startups are still utilizing this technique to promote their projects.
How Do Crypto Airdrops Operate?
Crypto Airdrop is a marketing tool usually adopted by blockchain-based projects to promote a digital project. Its objective is to provide information about a newly released crypto startup and to engage more people in its trading after listing on an exchange as an ICO. Airdrops are generally advertised on the website of the firm or cryptocurrency platforms. Free crypto is transferred to the existing holder of crypto wallets typically those of Bitcoin – the leading cryptocurrency tradable via Ethereum. To claim free coins/tokens a user must possess a specific amount of coins in his/her crypto wallet. In some cases, they have to complete certain activities like posting about that specific digital currency on social media platforms, linking with a particular person of blockchain initiative, or writing something about the project.
Types Of Airdrops
A crypto project can conduct Airdrop in the following ways:
● Bounty Airdrop
It demands the performance of specific activities like sharing a project post on Twitter or retweeting a post, joining the official Telegram of the startup, and mentioning some friends on an Instagram post. To receive a bounty airdrop you have to fill out a form providing your wallet address and proof that you are done with the required activities.
● Exclusive Airdrop
This airdrop transfers free coins/tokens to the specified wallets only. Usually, the user contains a well-developed history with the initiative, like actively connecting with the project community or supporting the project at its initial stages. For example, two years ago, Uniswap, a DEX, airdropped 400 UNI tokens to each wallet holder who somehow communicated with the platform. The governance token provides the voting right to decide on project development.
● Holder Airdrop
These airdrops send free tokens for holding a certain amount of cryptocurrencies in a crypto wallet. The startup team normally takes a snap of the holdings of a person on a specific date & time. If there is sufficient balance to meet the requirements users can claim free crypto. New projects often target BTC or Ether holders for airdropping because they have captured the major portion of the market. For instance, XLM airdropped three billion XLM to Bitcoin holders back in 2016.
Crypto Airdrops make crypto startups capable of standing on their feet and attracting the attention of the crypto community. It is also an effective method for crypto enthusiasts to make their portfolio profitable with the free tokens, but there are also many airdrop scams in the market, and you have to survive them on your own.