What is AirDrop? | Banxe

authorBanxe Team
time 5 min read date 13.07.2022
image delimiterLearn hub

AirDrop is a specific marketing ploy that includes the distribution of tokens or coins to investors' crypto wallets in order to attract attention to a new token or a crypto exchange.

To draw attention to a new brand or product, tokens of coins are sent out for free or some kind of advertising service, for example, reposting information and adsto the community. The purpose of this publicity stunt is to attract the public to a new crypto project, as well as to increase the number of traders using this currency when it is placed on the exchange as an initial coin offering (ICO). It is also worth noting that any promotional action does not imply sending currency from the trader to the community. Legitimate community airdrops only send tokens to existing crypto wallets. Many scammers ask you to transfer a small amount of any cryptocurrency to the bot's wallet for the so-called verification or registration in the participation of the airdrop.

The first public airdrop was subsidised in 2014. When the Auroracoin (AUR) community announced that every citizen of Iceland who provided their document could receive 31 AUR. This cryptocurrency was intended exclusively for the nation of Iceland.

Just like the airdrop of crypto coins, there are also drops for NFT to increase the hype of the collection or reward the owners of particular paintings.

There are several types of airdrops. The first - is the standard drop , that was  described above. This is a standard free transfer of coins and tokens to crypto wallets.

Bounty Airdrop - a similar standard airdrop, only with the condition that the user completes a straightforward task in the form of a repost of a publication on social media such as Facebook / Twitter.

There is also Holder Airdrop - distribution of coins to those traders who already have a certain amount of coins.

Exclusive Airdrop is sending coins to the wallets of those users who have historical value in the project. In 2020, the Uniswap exchange distributed 400 UNI coins to those traders who used their services before a specific date.

Hard Fork Airdrop , a distribution of tokens and coins occurs when the original chain of blocks is forked. Instead of old coins, the copyright holder receives exactly the same amount of new ones in their wallet.

Are crypto airdrop and ICO the same thing?

Airdrops and ICO are most definitely not the same thing. There are similarities between airdrops and ICO, in that they are associated with the release of a new crypto project, but these are two completely different concepts. At the moment, when the organisers of the airdrop give out tokens for free, the company that initiates the airdrop, enters into the role of collecting money in the form of crowdfunding. At the ICO stage,the project team sells part of their tokens to raise funds, to improve the project.

How to participate in an Airdrop?

Be on the lookout on social networks for #Airdrop (using a hashtag), follow new Fintech crypto projects, new coins, NFT’s, and exchanges. If you’re an active participant in new communities that are dedicated to blockchain topics, you’re sure to find an airdrop.

The results of some airdrops are sometimes reported after it has already been completed and the participants have reached the required conditions. For example, the possession of a certain type of coin in a certain amount or the completion of transactions on the platform, as was the case with the LOOKS airdrop ,where users received NFT tokens in the form of a bonus for transactions greater than 3 ETH.

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