Imagine just walking down the street, minding your own business. And suddenly, a bag of cash drops right in front of you! This is the essence for every crypto airdrop and precisely what makes them attractive. It’s like free cash! But crypto airdrops don’t happen randomly. Projects do airdrop for people (or wallet addresses) that meet certain requirements. These requirements differ case to case. But the premise stays the same. So let’s talk about this premise.
How does a crypto airdrop work?
Crypto projects that want to do an airdrop, determine the conditions and a timeline. Users that meet these determined criteria, get the airdrop on their wallet on the specified schedule.
For example, short after Bittorrent started as an application on the Tron blockchain, they did an airdrop. They said that when the Tron blockchain reaches the height of 6.6 million blocks, they would take a snapshot of their blockchain, meaning they would make a list of addresses and how much TRX token they hold. (TRX is the main coin for the Tron blockchain.)
After the snapshot, 10,890,000,000 of BTT token (the token for Bittorrent project) was deposited to TRX wallets, based on how much TRX they held. This is, more or less, how crypto airdrops work. Although sometimes you have to do certain thing other than holding a coin, like following the project on social media. And sometimes you have to claim the airdrops, before they are deposited in your wallet.
Why Do Crypto Companies And Crypto Projects Do Airdrops?
There are several reasons for doing an airdrop. These are the main ones:
1. People Love Airdrops
People love airdrops. It’s free money that can appreciate over time (although many won’t). Who wouldn’t love it?
The trick is making people love the brand that’s behind the airdrop. If you trade on certain platform or hold a certain coin or token, receiving a valuable airdrop can make you a loyal user for life! Even you’re not currently a user, hearing about an airdrop can at least make you aware of the project that’s doing it. You may even become a user so you can take part in potential future airdrops.
2. Decentralized Projects Need Decentralized Distribution
Right now, the founders and early investors of a project get most of its tokens. If these tokens are related to governance and if these projects really want to be decentralized, doing an airdrop can distribute their tokens in a more random way, making the whole project a bit more decentralized.
Are All Crypto Airdrops Safe?
No. Pay attention to the conditions of the airdrop and the brand behind it. If they ask you to send them crypto, run for your life! Because it’s most certainly a scam.
If you can see what’s in it for them, you can try it.
If you are not sure but want to try your luck with airdrops that don’t ask for money in advance, you should think about using a brand new wallet. This can reduce the risk a little, if you have a lot in your wallet. You can also create a wallet just for airdrops! Having most of your assets secure in a hardware wallet doesn’t hurt either.
One last note: beware of the emails and messages you get after signing up or participating in a public airdrop. (especially when part of it includes posting on social media.) Don’t click on any link until you’re absolutely sure about its origins. Otherwise, you may fall victim to a phishing attack.
What do you think about crypto airdrops? What’s the biggest one you’ve taken part in?
Share this post with your friends and on social media to keep people from getting scammed.
***Last Updated on 4 April 2022 by Hamed Derakhshani (Guy with a Wallet)