Introduction
As the number of crypto projects & thus the coins and tokens increase in the market, it has become a struggle to stand out from the crowd. In order to create better awareness & buzz around their work, some companies do what they call crypto airdrops.
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What is a crypto airdrop?
Crypto drop is a marketing strategy popular among crypto companies these days. There is a transfer of some crypto tokens from one account, i.e. the company’s, to multiple wallets of the airdrop winners. Such airdrops are offered for free but usually are tied to some kind of task that the claimant has to complete.
How do these airdrops work?
Airdrops are the wild west. There is no single way to do an airdrop. The only constant is that some people end up getting some tokens for free. Some projects give away these tokens without asking for anything else while others require a certain task. It might be anything like following the official social media account or buying a certain number of tokens to enter the lucky pool. Still, not everyone is guaranteed to win.
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Why these airdrops?
These airdrops act as a marketing strategy. Who doesn’t need a free asset or two? All they need to do is do some simple tasks. It introduces them to the crypto project, makes them share it with friends, and gives them skin in the game among other things. Thus, people have an incentive to promote the project on their end as well.
However, an airdrop is not a measure of success for a crypto project. And it’s definitely not a sustainable way to grow your portfolio. If you want to compliment your portfolio by trading, consider subscribing to a crypto signals provider on telegram. They’re usually veteran traders who share their trades with their members.
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Types of Airdrops
There are different strategies that companies adopt to distribute their tokens through airdrops. The following are the most common ones.
- Bounty Airdrops
It means you get a bounty to complete which then earns you a reward. For this type, you need to complete certain tasks. Companies use this type to generally create project awareness while collecting information about their target audience.
- Exclusive Airdrop
Exclusive Airdrops are targeted at predesignated wallets, generally the ones which have shown a longstanding commitment towards a crypto project. Companies use these airdrops as a reward for their loyal community base.
- Holder airdrops
Holder airdrops target the wallets that hold a certain minimum amount of the token/ cryptocurrency on or before a certain date & time. These types of airdrops are akin to bounty airdrops where your task is to buy a certain number of tokens before the designated date.
How to Avoid Crypto Airdrop scams
Scams in airdrops are quite possible. Sometimes you receive tokens in your wallets but your wallet drains as soon as your try to transfer the tokens to an exchange, or another wallet. Sometimes, they just announce a fake airdrop to lure you into connecting your wallet to their website. Once that’s done, you are robbed of your other tokens as well. Some scammers would even ask you to send a few tokens to an unknown wallet address for you to unlock your reward. That’s clearly not a good bounty task.
That is why you should always do your own research before applying for an airdrop. Go through their website thoroughly. Search the internet and their social media to find out what’s everyone saying about them. You can even set up a brand-new wallet just to participate in an airdrop. This insulates your current crypto assets from any possibility of a scam.
