How Do You Get Crypto Airdrops?

How Do You Get Crypto Airdrops

From collecting crypto airdrops to the risks involved in doing so—here’s what you need to know. 

Have you ever received discount coupons or special rewards simply because you were a brand’s registered member? That’s the idea behind crypto airdropping, too. In 2014, Auroracoin, the first crypto airdrop, distributed 31.8 AUR (US$385), its native token, to each Icelander in a bid to make it the national currency of the country. That amounted to 50% of its total coin supply. All residents had to do was register with the Auroracoin project to receive the tokens. 

The crypto market is becoming increasingly crowded, with every other company trying to get in on the action. After all, for a cryptocurrency to succeed, it needs to be widely used. One way to boost adoption and set yourself apart from your competitors is by offering airdrops.

What is airdropping?

In airdropping, a crypto project or startup sends free tokens to the wallet addresses of its community members. For instance, Gas DAO sent GAS tokens on Ethereum to anyone who had paid US$1,559 or more in gas fees on the blockchain platform. Investors could claim their tokens on Gas DAO’s website. 

Airdropping’s purpose is two-fold: one, it aims to encourage usage; two, it aims to boost awareness. In essence, it is a marketing strategy designed to promote your blockchain startup.

With more people using your tokens, you can earn enough to bootstrap your business and help it grow. You can also ensure a fair distribution of your tokens, avoiding resting power in the hands of a powerful few if you are airdropping governance tokens. 

How can you get free airdrops?

Here’s your step-by-step guide to collecting crypto airdrops:

Step 1: Set up your cryptocurrency wallet. Without one, airdrop projects would not have anywhere to send you the tokens.

Step 2: Check out sites that list different airdrops. Some popular ones include CoinMarketCap, Airdrops.io, Airdrop Alert and AirdropKing.io. Also follow crypto news alerts on social media channels to stay posted.

Step 3: Browse different projects and check their eligibility requirements for you to be eligible for an airdrop. Typically, there are four kinds of airdrop projects:

  1. Standard: Standard airdrop projects require you to sign-up for their newsletter using your name and email address. You get tokens for signing up. 
  1. Holder: Some airdrop projects send you free tokens if you have a minimum balance of a certain cryptocurrency in your wallet. For instance, if you have at least 0.1 ETH in your crypto wallet, you qualify to receive the airdrop. For this, you need to be an active cryptocurrency investor and maintain a balance amount.
  1. Bounty: Follow and engage with the project’s social media channels to receive airdrops. Some airdrop startups might require you to share, promote and like their posts.
  1. Exclusive: If you are the follower of a project’s social media pages and a member of their website, you automatically qualify to receive their tokens. 

If you access it well in time, some projects also let you claim tokens for free directly from their website using the smart contract mechanism. 

Step 4: Do your research. We cannot emphasize this enough. Whenever you plan on getting involved with any cryptocurrency-related project, don’t just rely on what the project is telling you. Engage in thorough research. Speak with other crypto enthusiasts, read news articles related to the projects and ask questions. 

Are airdrops safe?

Not always. While airdrops can be profitable, they can also turn out to be scams. For instance, the Founder of Bitcoin Advisory, Pierre Rochard, warned in a tweet that airdrops can be pump-and-dump schemes. It’s when project owners artificially boost the price of a token only to later sell all their tokens and make away with the cash, thus causing the token’s value to fall and you suffering losses. 

Additionally, some airdrops might turn out to be dusting scams. These aim to hack into your account when you use the token, thus revealing your personal details. Safe to say, not all free things are great. 

That said, airdrops do offer a host of benefits. For startups, airdrops can boost awareness considerably. For instance, following their airdrop, BRD Bitcoin’s social media following increased from a mere 2,000 and less to over 40,000. Additionally, it can also increase your token’s value. In 2020, decentralized exchange (DEX) Uniswap airdropped UNI, its native token, to wallets that had used the platform to perform at least one transaction before September 1, 2020. After their airdrop, the token’s value increased by more than ten times, from US$2 to US$30 in April 2021.

In the end, airdrops are little more than a marketing strategy. It helps companies when they want to launch an initial coin offering (ICO) or build stronger relationships with their community.

When casting around for airdrops, remember:

  1. Legit airdrops won’t ask you to make any sort of investment in their project.
  2. Some sites might airdrop tokens, thus building curiosity. However, it might be a ploy to get you on their website and execute a phishing scam.
  3. The airdrops you receive might be taxable, depending on the regulations of where you live. For instance, in India, you will have to pay a 30 percent tax on airdrops you receive. 

Crypto startups that want to stand out from the crowd and reach more people should consider airdrops. After all, they have been known to boost awareness and usage. Investors, too, can gain access to super profitable tokens at no cost. However, in the crypto space, exercising caution is crucial. 

Header Image by Flickr

SHARE THIS STORY

Share on facebook
Share on twitter
Share on linkedin
Share on email

RELATED POSTS

What Happens When Metaverse Meets Sports Leagues?

What Happens When Metaverse Meets Sports Leagues?

While many see the metaverse as a place for entertainment and escapism, recent years have seen the rise of sports leagues that exist entirely within it. These leagues have taken advantage of the metaverse’s ability to create realistic and immersive environments to provide their players with a new and unique sports experience.

Are Immersive Art Exhibitions the New Trend

Are Immersive Art Exhibitions the New Trend?

For many, museums and exhibitions are an escape from reality. However, these places have been experiencing an all-time low visitation rate due to Covid-19. Owing to social distancing norms and closures, going to a museum was just not always possible. To address that, museums took to virtual reality (VR).

Top 5 Upcoming IPOs to Watch Out For

Top 5 Upcoming IPOs to Watch Out For

2021 was a good year for IPOs. IPOs in the United States raised US$156 billion, recording an 81 percent increase over the prior year. With such an outburst, tech stocks raised US$69 billion alone significantly. Shares of Bumble, a dating app created for women’s interests, closed up 63.5 percent in their IPO in January 2021.

Tokenization Is a Game-Changer in the Financial World - Here’s How!

Tokenization Is a Game-Changer in the Financial World – Here’s How!

By 2027, businesses and people alike are expected to lose US$40.62 billion in payment fraud. The solution to this problem? Tokenization. It refers to the replacement of sensitive data with unique identifiers that retain the length and format of the original data without having any relationship with it.

4 Successful Indian Mompreneurs You Should Know About

4 Successful Indian Mompreneurs You Should Know About

There is no doubt that motherhood is a challenging job. But some moms out there are taking on an even greater challenge—starting their own businesses. From selling natural and toxin-free products for babies to being the best lipstick brand, these mompreneurs are proving that you can have it all. Read on and get inspired by these moms who have not only overcome challenges but also built successful businesses while raising their kids and family.

Beyond 9 to 5 The Rise of Triple Peak Workdays

Beyond 9 to 5: The Rise of Triple Peak Workdays

None of us would have even dreamt of the life we lived over the past couple of years. We experienced several transitions in doing things; we gained new opportunities and lost many of them. When we talk about work, 6-feet cubicles have been reduced to 15-inch displays as the concept of remote work has become mainstream.