Airdrop is the act of distributing native coins to promote and increase brand awareness of new cryptocurrency projects.
In order to incentivize participants on new crypto projects, they are usually required to complete simple tasks to be eligible for the airdrops.
These crypto airdrop tasks may include joining the project Telegram group, or even promoting it on social media platforms.
Sometimes, no effort is needed at all; participants can automatically qualify, if they own a certain amount of the project’s native coin.
It is a win-win situation as participants receive free tokens, while the issuing project benefits from the enhanced branding and community.
However, cryptocurrency airdrops are genuine ways to earn free altcoins without investing your money.
How cryptocurrency airdrops work
Airdrops works in a way that, if you have in possession any coin that evolves, you will become eligible to claim new tokens.
So long as you have the mother coins already in your wallet, you will definitely get some of the newly forked token.
Reason for crypto airdrops
There are so many ways to create buzz, or hype new DApps and tokens, but these are the general reasons for free airdrops.
1. Even supply and distributions
The first reason why there are airdrops in cryptocurrencies, is to evenly distribute the total supply of tokens.
It will help to lessen the centralization, as HODLers holding large amount of coins to themselves.
2. Rewards to early investors
Most companies also use this process to reward their early ICO investors for patronizing their new projects.
This is an idea to make parent coin investors to hold their tokens for a longer time.
3. Creating awareness
To create awareness for emerging tokens, airdrops are offered to early HODLers of the native coins (like; Bitcoin, Ethereum, Monero etc.)
4. Buzz or hype for marketing
Airdrops is a major marketing technique used to attract investors, and collect leads for business opportunities and expansions.
These kinds of airdrops are called Crypto Bounties.
Bounties are the new tokens given to individuals for completing tasks (like; sign-ups, referrals, joining Telegrams and following on Twitter etc.)
5. Soft or Hard forks
Forking is a technique used for bringing out new tokens and crypto-coins from popularly known cryptocurrencies like; Bitcoin, Ethereum, Monero, Litecoin etc.
Sometimes, new coins that are distributed to the early investors of those coins are also created totally on a fresh blockchain node.
As an investor, it’s profitable to have a good number of cryptocurrencies in the portfolio you’re holding.
How to participate in airdrops
To get started, you will need a few things, while participating in getting cryptocurrency airdrop free;
1. Cryptocurrency wallet
You should create a privately-owned digital wallet to safely store your cryptocurrency assets.
This does not apply to the wallet in your exchange account, since you will have access to the private keys.
Furthermore, you can never fully trust a third-party to keep your coins safe.
Additionally, hardware wallets are the safest in the market, while Ledger Nano S and X has been the most common amongst them.
To learn more about different types of wallet, here’s a guide that explained crypto-coin wallets.
2. Valid email address
Most cryptocurrency airdrops require that you to sign-up, and apply for the whitelist using an email address.
An email address is also needed when registering at crypto exchange.
Having an email address dedicated to airdrops alone can be convenient, if you’re focusing big-time on getting free tokens.
3. Social media accounts
Airdrops require you to share about the project on your social media accounts, before you are eligible for the airdropped coins.
The range of actions can include sending out a Tweet, or sharing posts on Facebook pertaining to the project.
In exchange for that, you will receive free airdropped tokens.
4. Comply to the deadline
Always make sure to complete your registration before the stated deadline, with all requirements fulfilled.
There is usually a deadline when registering for the whitelist of the airdrop, and it’s common for a project to initiate more than one airdrop.
Types of airdrops
Airdrops are different types of cryptocurrency airdrops, and they all come with set of actions and specific requirements:
1. Standard airdrop
It requires that you only sign up for updates on the project’s website with your name and email address – if necessarily needed.
2. Bounty
This requires you to perform some social media tasks like; tweeting out a link of the project’s website and referring other people to the airdrop.
This is one of the simplest way to make money with Bitcoin, and some other cryptocurrencies.
3. Holder airdrop
This type of airdrop is gotten when you HODL a specific coin in your cryptocurrency wallet before the distribution starts.
The airdropped coin (or token) will be given according to a ratio set out by the project.
For example, a 1:5 BTC ratio entitles you to 5 airdropped coins for every BTC you have inside your wallet already.
4. Exclusive airdrop
These airdrops are hosted and managed by website, or social media accounts with very large followings.
As a member, you will be entitled to some amount of airdrops that is exclusive to that particular community.
Website like Airdrop.io and airdropalert.com allows you to participate in exclusive airdrops if you sign up to their newsletter.
Finding upcoming airdrops
In getting upcoming airdrop alerts, there are special crypto airdrop checker tools required to receive free airdrop alerts.
Below are list of tools that can used get updates on future airdrops for free:
- Coinairdrop
- Winbitcoinsnow
- airdrops.io
- airdropalert.com
- Cryptoairdrops
- BitcoinTalk.Org
- Airdrop Twitter accounts
Summary: Cryptocurrency airdrops
Undoubtedly, with the popularity of this space, there are many crypto airdrop scams you will find along the line.
Always avoid any crypto airdrop project that ask for your wallet private key, or seed phrase words to get paid.
Try to educate yourself on getting airdrops, as the entire cryptocurrency space can actually make you some money with these free tokens.
Make use of crypto burner wallets to separate Paul from Barnabas (i.e. keeping Airdrops separate from your invested funds).
Be very careful when dealing with airdrops to avoid loosing your cryptocurrency investment due to ignorance.
