Crypto airdrops: Here is everything you need to know

• Crypto airdrop is a marketing technique used during the launch of a crypto project.
• There are primarily three types – bounty, exclusive and holder.
• The crypto market is also full of scammers, and it is necessary to be vigilant against “pump and dump” schemes.

This is not typical of you Apple Airdrop where you receive audio, images and video clips in the blink of an eye. Crypto airdrop is a marketing technique, mainly used to market a specific crypto product or project. The word “airdrop” is when small amounts of cryptocurrency are sent to users’ wallets for free or in return for a small service – usually advertising.

A country’s original cryptocurrency is usually distributed free of charge to users in an attempt to market the currency or get a buzz on social media. If you go and log in the word ‘Airdrop’ on Twitter, there are a lot of projects that appear on the screen, and each promotes its own agenda.

When did crypto-airdrops become popular?

The first crypto-airdrop is documented to have occurred on March 25, 2014. AuroraCoin (AUR), which was intended to be the cryptocurrency for Icelandwas sent from the air, and each citizen who submitted his national ID received 31.28 AUR.

Crypto airdrops became very popular during the initial coin offering phase which began back in 2017. Airdrops were used to increase the circulation of the currency before they were listed on the stock exchange. They were instrumental in giving legitimacy to the crypto projects. Airdrops does not request any personal investment from customers.

Types of air droplets

There are primarily three types of airdrops – bounty, exclusive and holder. While a bounty airdrop requires you to promote or complete certain tasks related to the project, an exclusive airdrop is sent only to designated users. These customers must either be an early supporter of the project or a member of an active community associated with it.

This was done by the recent user of Bitcoin, El Salvador – where citizens were sent BTC worth $ 30 for each citizen who downloaded the state wallet.

Holder airdrops distributes free tokens to wallets that have a certain amount of digital currency in them. If the balance meets the minimum requirement for the project, they can claim the said tokens.

How do crypto airdrops work?

Airdrops are usually distributed on Ethereum and Binance smart chains. These require users to either have a certain amount in their wallet or promote the company.

Even if users go through all the steps, there is no guarantee that users will have access to tokens for the projects being promoted. Often the project only gives access to users who have participated in the project before a certain date. As is true with all marketing tactics, crypto-airdrops have their pros and cons.

Two pages for crypto airdrops

The crypto market is also full of scammers, and it is necessary to be vigilant against “pump and dump” schemes. These projects have a lot of hot air in them, and although airdrops never ask for crypto investments, some fraudulent projects steal your wallet when you claim or transfer free tokens. A special precaution must be taken when connecting the wallet to the airdrop website.

In October 2020, Binance the chain underwent what is known as a “dust attack”. After sending small amounts of bitcoins to several addresses, a link to a malicious website was left in the transaction note, prompting careless users to click on the link to receive it. Wallets are susceptible to attack, and airdrops are a means to an end.

It is necessary for users to make sure that the project they are investing in has been thoroughly researched and talked about in the past. If the entrepreneurs are well known and can be held accountable on social media, it helps tremendously. While airdrops are effective in marketing a crypto product and cultivate a sense of decentralized ownership, one must keep an eye out for possible fraud.