Did you know you can get crypto coins without investing your hard-earned cash? If not, consider AirDrop — the marketing strategy during which project creators distribute tokens for free.
In 2017, Jun Hasegawa, the CEO of Japanese startup Omise, developed the Airdrop concept. As part of the campaign to promote OMG tokens, users with at least 0.1 ETH in their wallets received coins for free. According to Jun, an airdrop is a unique economic tool that unites the community and helps popularize crypto startups and products. The innovation of the Japanese entrepreneur took root and began to spread around the world.
Want to learn more about free cryptocurrency airdrops? Check this crypto airdrop guide to discover what airdrop is, why project founders hold such promotions, and what benefits and risks they involve.
Table of Contents,
- 1 What Is an Airdrop? 💰
- 2 How to Participate in Airdrops? 👨💻
- 3 Airdrop Benefits🤩
- 4 Airdrop Risks 🙄
- 5 Successful Airdrop Examples 🤑
- 6 Wrapping Up 👌
- 7 FAQ 💡
What Is an Airdrop? 💰
Let’s start with the definition. An airdrop is a marketing strategy during which crypto project developers distribute tokens among users free of charge. The marketing strategies aim to draw attention to the project and attract new users. Such public campaigns raise awareness about a startup’s product and encourage widespread adoption of its native token.
The idea of an airdrop has become popular due to various restrictions on ICO promotion. As popular social networks introduced these restrictions, crypto project founders began switching to free promotions, which quickly proved effective.
Today, there are different airdrop coin distribution methods. Let’s look through the most common ones.
With this type, you don’t need to do anything other than register an account. The main thing here is to hurry, as there can only be a specific supply of tokens tied to the project’s release. RabbitX, a decentralized exchange, held such an airdrop at the start of its work.
Hard Fork Airdrop
When a blockchain project forks and a new coin appears, those with the original token receive an equal number of new tokens. Curious about successful airdrops for altcoins? In 2017, during the hard fork of the Bitcoin Cash (BCH) network, BTC holders automatically received the same amount of BCH coins.
Airdrops can distribute free tokens to those who have a certain amount of digital currencies in their wallet. The project team usually takes a snapshot of users’ crypto assets at a specific date and time. If the wallet balance meets the minimum requirements, recipients can qualify for free tokens based on their holdings at the time of the snapshot.
To participate in the bounty airdrop, you’ll need to perform specific actions, such as tweeting about the project, joining the company’s Telegram channel, or creating a post and tagging friends on Instagram. In addition, to receive an airdrop reward, you’ll most likely need to fill out a form with your wallet address and provide proof that you completed the tasks.
With an exclusive airdrop, a startup will send tokens to designated wallets only. To qualify for free crypto, you must have a history of being involved with the project, such as being an active community member or early adopter.
In September 2020, the Uniswap crypto exchange gave away 400 UNI to every wallet that interacted with their protocol before a certain date. As a result, UNI holders received the right to vote on decisions related to the project’s future development.
How to Participate in Airdrops? 👨💻
How do you participate in a token airdrop? The easiest way to find it is to simply type “crypto airdrops” into an online search engine. Once you do, you’ll see numerous websites dedicated to upcoming promotions. Check out to see how to join airdrop communities and follow the official channels of projects.
Regardless of the distribution type, you need a relevant address on the network of the token you want to receive. Thus, you need a non-custodial wallet, the keys to which you store yourself (for example, MetaMask or Trust Wallet). A digital wallet on a crypto exchange such as Coinbase won’t work in most cases. Ensure the cryptocurrency wallet for airdrops is trustworthy before entering any personal information.
Most likely, you’ll have to meet specific requirements. These requirements may include subscribing to the project pages in social networks, holding a particular crypto asset, or using a specific application.
What’s great about free cryptocurrency airdrops? Here are the major benefits of these giveaways.
They can bring significant returns. If you make correct price predictions and your free crypto assets grow in value, you can make huge profits.
They are excellent for people who have limited funds for investing but still want to gain access to high-quality projects. Of course, getting crypto tokens for free is always a good deal.
Access to Additional Services
Being a token holder gives you access to new services and products. These perks may include special discounts, early access to products and services, voting on project development decisions, and other advantages.
Uniswap’s UNI is one of the most famous examples, as it gives holders many advantages like discounts on fees and voting rights.
Airdrop Risks 🙄
As with everything related to crypto assets, certain risks are associated with participating in airdrops. Let’s look through the most common drawbacks.
Scams and Frauds
The most considerable risk is that they can be used to launch dangerous scams. Fraudsters will typically distribute tokens, promising huge returns in the future. However, users are left with nothing but worthless tokens once the project fails due to a lack of funding or other issues.
Private Key Theft
Another risk is that malicious actors may try to steal your private keys. If someone gains access to your wallet, they can easily remove all the funds from it. So, only use secure wallets and never share your private key with anyone.
“Dusting attacks” is an increasingly popular type of attack where malicious actors send tiny amounts of crypto tokens to random users. The purpose of these transactions is to track the wallet activity and potentially steal funds from it. To protect yourself, make sure to only interact with trusted websites.
Another issue to consider is how taxes work with airdrops. In most countries, free tokens qualify as taxable income if the market value of the airdropped coins exceeds certain thresholds. Thus, you should always check taxation rules when participating in airdrops.
Legal and Regulatory Risks
As with any other cryptocurrency investment, beware of the regulatory risks associated. Depending on your jurisdiction, participating in an airdrop could qualify as trading or investing in tokens, even if no monetary exchange occurs. So, be sure to check crypto airdrop rules and regulations in your country.
Successful Airdrop Examples 🤑
Now, let’s take a look at some of the successful airdrop projects.
This is one of the most successful cases in cryptocurrency history. Launched in June 2017, this airdrop distributed up to 1 billion tokens for free during its Initial Coin Offering (ICO). These tokens gave users the right to vote on major decisions and receive rewards for staking coins.
In October 2018, Stellar partnered with Keybase to launch a $100 million airdrop. As one of the largest token distributions ever made, it helped increase the adoption of the XLM token. The project attracted over 2 million users, earning up to $50 worth of tokens each.
Ontology Airdrop is another successful crypto project. Launched in April 2018, it distributed free ONT tokens to its community members. This airdrop enabled users to vote on project-related decisions and get rewards for staking coins. Furthermore, it allowed Ontology to develop an ecosystem of applications that could use the platform’s underlying technology.
Wrapping Up 👌
Airdrops are one of the most exciting phenomena in the crypto world. It’s a great way for companies to promote their tokens and increase adoption. In addition, they enable crypto enthusiasts to earn digital assets while also allowing projects to grow their user base.
Remember that they come with certain risks, so it’s important to select the right opportunities carefully. However, if you do your research and choose reputable projects, participating in an airdrop can be a great way to earn tokens without investing any money.
It is a marketing strategy used by cryptocurrency projects to distribute free tokens or coins to many people in the hope of increasing their adoption and creating a network effect.
To participate in an airdrop, you must meet specific criteria the project sets, such as holding a specific cryptocurrency, being active on social media, or signing up for a newsletter. Once you meet the criteria, you’ll receive free tokens or coins in your crypto wallet.
Yes, they are always free. Their purpose is to give away tokens or coins for free to increase the adoption and awareness of a project.
They can be safe if you follow basic security practices, such as only participating in airdrops from reputable projects and avoiding scams. It’s essential to do your research and be cautious when participating.
It depends on the rules set by the project. Some of them allow multiple entries, while others limit participation to one per person.