What is a Crypto Airdrop: Meaning, Types, and How Does It Work?

What is a Crypto Airdrop?

Crypto Airdrop is a marketing strategy used by cryptocurrency projects to distribute free tokens or coins to a specific group of people, typically existing cryptocurrency holders or members of a particular community. The term "airdrop" comes from dropping these tokens from the "air" to the intended recipients, as it's often done by sending tokens directly to their digital wallets.

Airdrops are part of a marketing campaign that helps to attract new customers.

To get free tokens, users often need to perform tasks like following an account, tweeting, sharing posts, or signing up to receive updates.

There are plenty of airdrops, and each crypto project has its requirements. Some are done directly into users' wallets, while others require a manual claim. But most airdrops share the same goal: to increase awareness and overall interest in the project.

This article will tell how airdrops work, how to get some free crypto tokens, and how to find unclaimed airdrops. Without further ado, let's start!

How Do Сrypto Airdrops Work?

Crypto airdrops work by distributing free cryptocurrency tokens or coins to a specific group of recipients. The primary goal of a crypto airdrop can vary, from promoting a project to rewarding early supporters or increasing community engagement.

Airdrops usually consist of a small amount of cryptocurrency distributed to several wallets (usually on Ethereum or Binance Smart Chain).

Not so often, but still, several projects give away NFTs instead of regular crypto. Also, some projects distribute crypto without even asking to complete any tasks. In contrast, others try to motivate users to participate in sharing posts or do other stuff to promote a project.

Sometimes, the airdrops can be sent only to wallets collaborating with the project before a specific date. For example, 1INCH and Uniswap provide the most popular airdrops of this kind.

Now, let's see other types of airdrops with their unique characteristics. The main aim of any airdrops is marketing, so projects want to grow brand awareness and user attraction in exchange for rewards.

What are Common Crypto Airdrop Types?

There are several common types of crypto airdrops, each with its specific purpose and criteria. Here are some of the most common crypto airdrop types:

• Holder Airdrops

• Community Airdrops

• Snapshot Airdrops

• Fork Airdrops

• Promotional Airdrops

• Governing Token Airdrops

• Reward Airdrops

• Staking Airdrops

• Bounty Airdrops

• Education Airdrops

• Random Airdrops

• Liquidity Airdrops

📍Holder Airdrops

Characteristics: These airdrops reward existing cryptocurrency holders. Participants receive free tokens based on the amount of a specific cryptocurrency they hold in their wallets at a snapshot date and time.

📍Community Airdrops

Characteristics: Community airdrops aim to build or reward a project's community members. To qualify, participants may need to join social media groups and forums or follow the project on various platforms.

📍Snapshot Airdrops

Characteristics: Snapshot airdrops involve taking a snapshot of a blockchain's ledger at a particular block height or time. Holders of a specific cryptocurrency at that moment receive airdropped tokens.

📍Fork Airdrops

Characteristics: When a blockchain undergoes a hard fork or chain split, creating a new cryptocurrency, holders of the original cryptocurrency may receive airdropped tokens from the new chain.

📍Promotional Airdrops

Characteristics: Projects use promotional airdrops to generate buzz and attract attention. Participants may need to complete simple tasks like sharing social media posts, referring friends, or signing up for a newsletter.

📍Governing Token Airdrops

Characteristics: Some projects distribute governance tokens through airdrops, giving recipients a say in project decisions and proposals. Holders of these tokens can participate in governance votes.

📍Reward Airdrops

Characteristics: Reward airdrops are a way for projects to thank their loyal users or early supporters. Participants receive tokens as a reward for their loyalty or contributions to the project.

📍Staking Airdrops

Characteristics: Staking airdrops reward users who lock or "stake" their tokens in a blockchain ecosystem. In return, they may receive additional tokens as staking rewards.

📍Bounty Airdrops

Characteristics: Projects offer bounty airdrops to individuals who perform specific tasks or contribute to the project's development. These tasks can include bug reporting, content creation, or marketing efforts.

📍Education Airdrops

Characteristics: Education-focused airdrops reward participants for learning about cryptocurrencies or specific blockchain technologies through courses, tutorials, or quizzes.

📍Random Airdrops

Characteristics: Some projects conduct random airdrops with no specific criteria or requirements. Participants are selected at random to receive tokens.

📍Liquidity Airdrops

Characteristics: DeFi platforms often use liquidity airdrops to incentivize users to provide liquidity to decentralized exchanges or liquidity pools. Participants earn tokens based on their contributions.

These are some common crypto-airdrop types, but we can meet new variations and creative approaches as the cryptocurrency space evolves.

How to Get Free Tokens?

There are several ways to participate in crypto airdrops and get free tokens, although it's important to note that nothing in life is truly "free," and these methods may still require some form of effort or investment.

There are several steps to take to learn how to get free tokens:

🎯 Step 1: Faucets. Find relevant crypto airdrop websites - faucets.

What are faucets?

Cryptocurrency faucets are websites or apps that give away small amounts of cryptocurrency for completing simple tasks or captcha challenges. While the amounts are usually minimal, it's a way to get started with cryptocurrencies.

🎯 Step 2: Social Media. Check social media for the #airdrop hashtag and see if anything new has happened.

🎯 Step 3: Try Blockchain Products. Become an active user of cryptocurrency services, products, platforms, and blockchains. Some blockchain projects offer rewards in the form of tokens for users who hold and "stake" their cryptocurrency in a wallet or on a platform. These rewards can accumulate over time.

🎯 Step 4: Visit Forums. Explore cryptocurrency-related forums and news portals. Some cryptocurrency exchanges and platforms have referral programs that reward users for referring new customers. You can earn tokens or a percentage of the trading fees generated by your referrals.

🎯 Step 5: Find Bounties and Tasks. Some projects offer bounties or tasks that reward users for contributing to the project's development or promotion. It may include activities like writing articles, creating content, or reporting bugs.

🎯 Step 6. Use Giveaways and Contests. Cryptocurrency influencers, projects, or exchanges sometimes host giveaways or contests on social media platforms, where participants can win tokens by following specific rules or answering questions.

🎯 Step 7. Forums and Communities. Active participation in cryptocurrency communities, forums, and social media platforms can sometimes lead to opportunities to receive free tokens as rewards or as part of community initiatives.

🎯 Step 8. Education and Learning. Certain platforms and projects offer tokens as incentives for learning about cryptocurrencies or specific blockchain technologies through courses or tutorials.

You can't receive or claim an airdrop if you don't have a wallet address. Using an exchange address is convenient but not suitable for airdrops.

What are the Best Crypto Airdrops?

Determining the "best" crypto airdrops can be subjective and depends on individual preferences, goals, and risk tolerance. What may be considered the best airdrop for one person might not be the same for another.

There are many free airdrops, but I will mention several worth considering.

Most popular crypto airdrops for 2023:

• Tamadoge

• Basic Attention Token (BAT)

• Telos

• OP Names

• Battle Infinity

• Lucky Block

• Pulsechain

• DeFiChain

• Binance

📍Tamadoge

This project has a Telegram page you can visit. Tamadoge is giving away $100,000 to one holder of $100+ of their token, TAMA. Free airdrops for visitors.

📍Basic Attention Token (BAT)

Basic Attention Token (BAT) is a type of cryptocurrency made just for online ads. Its main goal is to ensure ads reach the right people, pay website creators for their content, and reward users for interacting with ads. Users of BAT are entitled to 70% of the advertising revenue generated.

📍Telos

Telos is a super-fast blockchain that's built on something called Antelope. It's made to work with special online apps (dApps) just like the ones you find on Ethereum. These dApps are used for things like online finance services (DeFi). Telos has some cool perks, like really cheap transaction fees (we call them gas fees) and speedy block creation.

📍OP Names

OP Names is a new online service that helps you take charge of your online identity. Even though it's just starting, it looks promising. Right now, they're giving away special digital things called NFTs to people who join their Alpha Testnet, follow them on Twitter, and use the Polygon network. It's a cool chance to have some one-of-a-kind digital stuff.

📍 Battle Infinity

Buttle Infinity is a new metaverse game. They give away $3000 in IBAT crypto tokens and, in return, want a user to complete some simple tasks like following the project's social media. All future crypto airdrops by Battle Infinity are usually announced on their Telegram page.

📍Lucky Block

Another crypto game based on blockchain technology. Lucky Block is one of the most popular crypto airdrops for 2022. The platform regularly announces new crypto airdrops, and users can register with the platform to avoid missing their chance.

📍Pulsechain

This one is considered one of the best free airdrops in terms of effort and value. Pulsechain tokens will be given to everybody with ETH in their wallet in a 1:1 ratio. Users have 30 days to relocate tokens to a new wallet; otherwise, they can lose their airdrop.

📍DeFiChain

DeFiChain is like a special computer system that works with Bitcoin. It's made just for things like online banking without big companies. They're teaming up with Cake DeFi to give $30 to new people, put $50 in their account, and finish the checks. If you tell your friends, you can get more rewards too.

📍Binance

This world-known crypto exchange often provides instant airdrops. Binance often hosts several trading tournaments and giveaways for its users. Their promotions include a share of 90,000 BUSD, 200 NFT mystery boxes, and a prize pool worth $4,000. All you need to do not to miss your chance is follow their newsletters.

Before choosing any free airdrop, conduct thorough research and due diligence. Be cautious of scams, phishing attempts, and offers that seem too good to be true. Additionally, diversify your cryptocurrency holdings and don't rely solely on airdrops as an investment strategy.

What are Upcoming Airdrops?

Let's explore some potential upcoming crypto airdrops and how you can become eligible for them:

Taiko

Ethereum-Compatible ZK-Rollup Taiko aims to provide complete Ethereum compatibility for developers, allowing them to deploy existing dApps without modifications. This zk-rollup solution offers faster withdrawals than optimistic rollups by using cryptographic proofs for transaction validation, eliminating the need for a challenging period. It also simplifies block validation and data transfer to Layer 1, making it a scalable blockchain for developers and users. An airdrop for Taiko tokens (TKO) is likely, given their white paper's mention of rewarding block verifiers and the ongoing Alpha-3 testnet with opportunities to earn points on Galxe, which could be converted into tokens.

Base

Coinbase's Layer 2 Base, developed by Coinbase, is a Layer 2 scaling solution for Ethereum using the OP stack. It's designed to offer Coinbase's massive user base a path into DeFi while contributing to Optimism's vision of an interoperable network of Layer 2s with lower fees and faster transactions. Although Base has stated they currently don't plan to issue a network token, they have initiated an Onchain Summer event where users can mint NFTs featuring renowned brands like Coca Cola and Atari.

MetaMask

Popular Wallet with Over 30 Million Users MetaMask is a widely-used crypto wallet allowing users to store private keys, interact with blockchains, and connect to decentralized applications. It has introduced features like built-in swaps, fiat on-ramps, bridge aggregators, and liquid staking services. Although not confirmed, there's potential for an airdrop related to MetaMask, as ConsenSys founder Joe Lubin has announced the release of a native token to enable governance through a DAO for "progressive decentralization."

Keep an eye on official announcements and developments for these projects to stay informed about potential airdrop opportunities.

Are Crypto Airdrops Safe?

Crypto airdrops can be both safe and risky, depending on various factors. There are many cases when fraudulent airdrops stole users' wallet funds while claiming or transferring the free tokens. To avoid such nasty things, do some research and confirm the project's legitimacy before claiming an airdrop. Be careful when someone asks you to connect your wallet to an airdrop website.

🔒Legitimacy

Safe - Airdrops conducted by reputable, well-known projects or creators are generally safe. These entities have a reputation to protect and are less likely to engage in fraudulent activities.

Risky - Airdrops from unknown or suspicious sources can be risky. Scammers often impersonate legitimate projects to trick users into participating in fake airdrops.

🔒Verification

Safe - Always verify the authenticity of an airdrop by cross-referencing information on the project's official channels, such as its website, social media accounts, and official announcements.

Risky - Falling for phishing attempts or scams can be risky. Be cautious of unsolicited messages, emails, or offers related to airdrops, especially if they ask for sensitive information like private keys.

🔒Private Keys

Safe - Legitimate airdrops do not require you to share your private keys or sensitive personal information. Never share your private keys with anyone; this is a security risk.

Risky - If an airdrop asks for your private keys or requests that you enter them on a website or platform, it's a clear red flag, and you should avoid it.

🔒Secure Wallet

Safe - Use a secure and reputable cryptocurrency wallet to receive and store airdropped tokens. Ensure that your wallet supports the blockchain on which the tokens are issued.

Risky - Using an insecure or unfamiliar wallet can harm your airdropped tokens. Make sure you choose a wallet that you trust.

🔒Double-Check URLs

Safe - Verify that the website URL you visit matches the official website of the project conducting the airdrop. Look for "https://" and a padlock icon in the address bar.

Risky - Visiting fake or phishing websites can lead to security breaches. Always check the website's authenticity.

🔒Community Verification

Safe - Seek confirmation and information from the project's official community channels, such as their website, Twitter account, Discord server, or Telegram group.

Risky - Relying on unofficial sources or unverified information can lead to participation in fraudulent airdrops.

Often, fraud happens when some projects do the distribution without asking for anything. Others may ask you to perform specific tasks before even claiming. These tasks often include following social media accounts, subscribing to a newsletter, or holding a minimum amount of coins in your wallet. But there is no guarantee that you will get the airdropped tokens, especially when the promised amounts are too good to be true.

Remember that connecting your crypto wallet to an untrustworthy party or giving up your private key is not wise.

Crypto Airdrops Scam: What to Look Out for & How to Avoid Them

Crypto airdrop scams are unfortunately common in the cryptocurrency space. To avoid crypto airdrop scams, here are some key things to look out for and steps to take to protect yourself:

1. Be Skeptical of Unsolicited Offers

Be cautious if you receive an unsolicited email, message, or social media post claiming to offer free cryptocurrency through an airdrop. Legitimate airdrops are typically announced through official channels and websites.

2. Verify the Source

Always verify the authenticity of the airdrop by visiting the cryptocurrency project's official website or social media profiles. Scammers often create fake websites that mimic legitimate ones.

3. Avoid Sharing Private Keys or Personal Information

Legitimate airdrops do not require sharing your private keys or sensitive personal information. Be extremely cautious if a supposed airdrop asks for this information, as it's a clear red flag.

4. Double-Check URLs

Ensure that the website URL you are visiting is correct and secure. Scammers may use similar-looking URLs to trick users. Look for "https://" and a padlock icon in the address bar, indicating a secure connection.

5. Research the Project

Investigate the cryptocurrency project behind the airdrop. Look for information about the team, the project's goals, and its legitimacy. Lack of transparency is a warning sign.

6. Beware of Too-Good-to-Be-True Promises

If an airdrop promises exceptionally high returns or asks you to invest money to participate, it's likely a scam. Legitimate airdrops distribute tokens for free and don't guarantee profits.

7. Check for Community Support

Legitimate airdrops often have support from the cryptocurrency community. Check forums, social media, and reputable cryptocurrency news sources for information and discussions about the airdrop.

8. Use a Secure Wallet

Ensure that you have a secure cryptocurrency wallet to receive airdropped tokens. Use wallets that are well-known and trusted in the crypto community. Be cautious of web wallets or apps you haven't used before.

9. Enable Two-Factor Authentication (2FA)

Enable 2FA on your cryptocurrency exchange accounts and wallets to add an extra layer of security.

10. Report Suspicious Activity

If you come across a suspicious airdrop or believe you have encountered a scam, report it to the relevant authorities and cryptocurrency communities. This can help prevent others from falling victim to the same scam.

While legitimate airdrops can provide free tokens as a promotional strategy, they are relatively rare, and caution is essential. If something sounds too good to be true, it's often best to err on the side of caution and avoid it. Always prioritize the security of your cryptocurrency assets.

Are Crypto Airdrop and ICO the Same Thing?

No, crypto airdrops and Initial Coin Offerings (ICOs) are different. They are distinct concepts in the world of cryptocurrencies, although they both involve the distribution of new tokens or coins. The main distinguishing thing is that airdrops don't require any participant investment, while ICO is a crowdfunding method. However, they both involve new cryptocurrency projects.

Initial Coin Offering (ICO):

An ICO is a fundraising method used by cryptocurrency startups to raise capital for their projects. During an ICO, the project's team sells a new token to investors in exchange for established cryptocurrencies like Bitcoin, Ethereum, or fiat currency.
ICO participants essentially invest in a project with the expectation of future returns. They receive tokens in proportion to their investment.
ICOs are structured like traditional securities offerings and are subject to regulatory scrutiny in many countries. They have been used to fund a wide range of blockchain-based projects.

To sum up, the key difference is that crypto airdrops involve the free distribution of tokens to a targeted audience, while ICOs involve fundraising by selling tokens to investors. Airdrops are often used for promotional purposes and community building, while ICOs are primarily used to raise capital for a project's development. Additionally, ICOs are typically subject to more extensive regulatory requirements than airdrops.

What are NFT Airdrops?

NFT (Non-Fungible Token) airdrops are a specific type where creators or projects distribute unique digital assets in the form of NFTs to a particular group of recipients. Unlike traditional airdrops, which distribute fungible tokens (like cryptocurrencies), NFT airdrops involve the distribution of non-fungible tokens, which represent ownership or proof of authenticity of a unique digital item.

How to Participate in an NFT Airdrop?

Participating in an NFT (Non-Fungible Token) airdrop involves following specific instructions provided by the project or creator conducting the airdrop. The process can vary from one airdrop to another, but here are general steps to participate in an NFT airdrop:

🎯 Stay Informed

Keep an eye on official channels and announcements from NFT projects or creators you are interested in. This includes their website, social media accounts (Twitter, Discord, Telegram, etc.), and newsletters.

🎯Verify the Airdrop

Ensure the airdrop is legitimate by cross-referencing information on the project's official channels. Be cautious of potential scams or phishing attempts.

🎯Meet Eligibility Criteria

Check if you meet the specific eligibility criteria set by the project. Common requirements may include:

Owning a particular NFT from the project.
Following them on social media.
Joining their community on a platform like Discord or Telegram.

🎯Complete Required Actions

If the airdrop requires certain actions (e.g., retweeting a tweet, joining a Discord group, or completing a survey), follow the provided instructions meticulously. Failure to complete these actions may disqualify you from the airdrop.

🎯Submit Necessary Information

Some airdrops may require you to submit information such as your wallet address or email. Ensure that you provide accurate and up-to-date details.

🎯Wait for Confirmation

After completing the necessary actions and submitting any required information, wait for confirmation from the project or creator. This confirmation may come in the form of a message or notification.

🎯 Receive the NFT Airdrop

If you meet all the criteria and successfully complete the required steps, the project will distribute the NFTs to eligible participants. These NFTs will typically be sent directly to the wallet address you provided during registration.

🎯Store and Manage Your NFTs

Once you receive the NFTs, they will be in your wallet. You can store and manage them like any other NFTs you own. Be sure to use a compatible NFT wallet that supports the specific blockchain on which the NFTs are issued.

🎯Engage with the Community

Join the project's community and engage with fellow participants. This can help you stay informed about future developments, opportunities, and potential benefits related to the NFTs you received.

🎯Be Cautious

Exercise caution and remain vigilant for scams or phishing attempts. Never share your private keys or sensitive information with anyone claiming to be associated with the airdrop.

Learn more about NFT marketing in our article “NFT Crypto Marketing: How Successfully Promote Your Project”.

Advantages and Disadvantages of Cryptocurrency Airdrops

Cryptocurrency airdrops have both advantages and disadvantages for both cryptocurrency projects and participants. Here's an overview of these pros and cons:

Advantages of Cryptocurrency Airdrops:

Airdrops can help build a strong and engaged community around a cryptocurrency project. The project can attract supporters and encourage active participation by distributing tokens to a broad audience.
Airdrops generate buzz and publicity for a cryptocurrency project. They serve as a marketing strategy to create awareness and attract new users and investors.
Airdrops can be used to distribute tokens fairly among the project's target audience, ensuring that early supporters and users receive a share of the tokens without having to make significant investments.
Some projects use airdrops to encourage users to interact with their platforms or perform specific actions, such as staking, participating in governance, or referring others.
Projects may distribute tokens in a beta testing phase to gather user feedback and identify potential issues or improvements in their blockchain or platform.
Airdrops can help decentralize token ownership by distributing tokens widely, reducing the concentration of tokens in the hands of a few large holders.

Disadvantages of Cryptocurrency Airdrops:

Airdrops are susceptible to scams and phishing attempts. Scammers may impersonate legitimate projects to trick users into sharing their private keys or personal information.
Not all airdropped tokens have significant value, and recipients may find that they are worthless or have limited utility.
Large-scale airdrops can lead to a sudden influx of tokens into the market, potentially causing price volatility or devaluing the tokens for existing holders.
Conducting an airdrop can be costly for cryptocurrency projects, as they need to allocate resources for token distribution and promotion.
Some airdrop recipients may not be genuinely interested in the project and may sell their tokens immediately, leading to a rapid sell-off and price decline.
Airdrops may attract participants who are not genuinely interested in the project's goals, which can dilute the quality of the community and engagement.
In some jurisdictions, airdrops may be subject to regulatory scrutiny, especially if they are considered a form of securities distribution.

In general, cryptocurrency airdrops can be an effective marketing and community-building strategy for blockchain projects. Still, they also come with risks and drawbacks, such as the potential for scams and market impact. Participants should exercise caution and verify the legitimacy of airdrops, while projects should carefully consider their objectives and costs when planning an airdrop campaign.

Takeaways

In general, crypto airdrops can be helpful for crypto projects to attract attention and get new users. It can also be a good way for crypto enthusiasts to grow their portfolios with unique tokens. But it would be best if you were careful with airdrops as there are a lot of scammers around. Be careful and do your research before participating in any airdrop.

FAQ

1. Can You Make Money From Crypto Airdrops?

Yes, making money from crypto airdrops is possible, but it's not guaranteed, and the amount you can earn varies widely. Remember that not all airdrops result in profitable outcomes; some may have minimal value or utility. Additionally, airdrops can carry risks, such as scams and market volatility, so exercise caution, research, and verify the legitimacy of any airdrop before participating.

2. How to Find Crypto Airdrops?

To find crypto airdrops:

Monitor cryptocurrency news and forums.
Use dedicated airdrop websites.
Follow projects and influencers on social media.
Check project websites.
Stay informed through cryptocurrency wallets and exchanges.
Attend cryptocurrency events for potential airdrop opportunities.

3. Do I Need to Pay to Participate in the Airdrop?

In general, legitimate crypto airdrops do not require you to make any payments to participate. They are designed to distribute free tokens or coins to eligible participants as a promotional or community-building effort. Be cautious of airdrops that ask for payments, as they may be scams. Always verify the legitimacy of an airdrop before participating.

4. Are NFT Airdrops Secure?

While legitimate NFT airdrops can be a fun way to receive unique digital assets, participants should exercise caution and due diligence to ensure their security. Verify the authenticity of the airdrop, protect your private keys, and stay informed about potential scams to minimize risks. Always prioritize your online security and use common sense when participating in crypto-related activities.

5. What Do I Receive in an NFT Airdrop?

The specific NFTs you receive in an airdrop can vary widely, and the value of these NFTs can also fluctuate based on factors like rarity, demand, and the reputation of the project or creator. Before participating in an NFT airdrop, reviewing the project's official announcements and documentation is advisable to understand what is being offered and what potential benefits or utility the NFTs may have.

6. Are Airdrops Taxable?

In many countries, airdrops of cryptocurrency tokens are considered taxable events. When you receive cryptocurrency through an airdrop, it's typically treated as income, and you may be required to report it on your tax return. The specific tax treatment can vary depending on your country's tax laws and regulations, so it is better to consult with a tax professional or refer to your local tax authority for guidance on how to handle airdrops in your jurisdiction.