If you frequent crypto and NFT discussion forums, you might have heard of the term “airdrop.” It’s mostly a marketing strategy used by crypto projects to increase user engagement and raise awareness about cryptocurrency.
Airdrops are free crypto tokens or NFTs that are given to people for performing certain activities such as liking, retweeting, or commenting under a Tweet.
What is a Crypto Airdrop and How Do You Get It?
Crypto companies are always finding new ways to promote their projects, and what better way to do it than by giving free crypto tokens to potential customers?
These airdrops usually happen on Twitter, but they’re also common on Discord, where crypto tokens or NFTs are airdropped to the crypto wallets of “whitelisters” or people who have been supporting the project from the start.
Every airdrop has a different set of eligibility criteria, and it’s usually determined by the team behind it. The most common way to get an airdrop is by participating in Twitter discussions.
As a way to increase engagement, crypto startups often give away crypto tokens or NFTs to people who like, retweet, or comment on their Tweets.
As you can guess, these Tweets gain popularity quickly, and because the giveaways are only reserved for a limited number of people, not everyone wins.
If you’re not active in the community, then you’re going to miss out on most airdrops that happen on Twitter.
On Discord, you’ll have to participate actively in the NFT or crypto project’s group to become eligible for an airdrop. Many crypto and NFT projects airdrop crypto/NFTs to people who keep the server active and spread the word about the project on other platforms.
Are All Airdrops Legit?
It’s not possible for every company to hand out free crypto tokens to hundreds and sometimes thousands of people, which means not every airdrop you see online will be legit.
The biggest red flag is when a company asks you to invest in their project to become eligible for an airdrop. An airdrop is supposed to be completely free. You shouldn’t pay anything to be eligible to receive it.
You should always do thorough research when deciding to follow or invest in a crypto project. A crypto startup that’s backed by other legit companies is unlikely to scam you. As long as you don’t pay anything, you’re safe.
Sometimes, airdrops are part of a pump and dump scheme. Crypto companies will airdrop tokens to hundreds of people, and when the token starts getting traction and its price goes up, the scammers will sell their tokens. This causes the price to plummet, leaving what’s known as bag holders selling their tokens for a loss.
What Can You Do with Airdrops?
If you receive a cryptocurrency as an airdrop, you can either sell it for profit or hold it until its price goes up. If it’s an NFT airdrop, you can use it to join the project’s community, participate in exclusive activities, or flip it for profit.
CryptoPunks, one of the most popular and exclusive NFT collections, was given to people for free when it was released in 2017. Today, its floor price is 67.45 ETH. You can see why it would be profitable to hold an NFT that you receive for free.
Source: Wikipedia
Conclusion
Airdrops are a common marketing tactic in the crypto world that crypto companies use to increase user engagement and get more people involved in the Web3.0 space.
If you’ve been airdropped crypto or an NFT, then it might be best to hold it until its price goes up, because it could be the next CryptoPunks!