What is an Airdrop?
Many people hear about Airdrop but do not know what it actually means.The simple answer: it’s literally just free coins just waiting for you.Read on to get full insight on what airdrop is all about.
They say that nothing good is gotten for free, right? And everything ever offered to you free of cost usually comes with an attached T&C, or probably is of subs-standard quality, right?
Well, this is not a case of Cryptos. The world of Crypto gives zero shits about the rules and standardized systems of the normal, traditional world.
Can you remember James Bond ?
A man who follows his own principles, rules, has a self-affirmed code of conduct, an own set of ethics. A fearless man who can piss in your drink before walking away with your girl right in your presence.:
Now back to the point! Crypto is the James Bond of the Finance world. It follows no particular rules, regulations or constructs of the typical market. It has its own mind, systems, set of ethics, and ecosystem. And guess what? in the world of Crypto, you absolutely can get free tokens by just registering for Airdrops
Let’s try to dig in to understand the viability of this approach and, most importantly, its implications on Bitcoin and Ether holders.
I know you’re probably thinking, why would a project decide to distribute its tokens for free instead of selling them?
Well, the airdrop method of distributing tokens is a better way to accomplish the same objectives of an ICO, which are usually three-fold:
Getting your token to as many wallets and people as possible for building a strong base of active users, who just might end up being real customers. However, the breadth of distribution is typically the important metric, particularly given that many projects are trying to jump-start a network effect.
- To create marketing waves
What is it also does is create marketing waves in the crypto ecosystem. It makes people to start discovering and talking about “free” tokens, and the word spreads around the community about that particular Token.
To fund the future development and build-out of the project.
Unlike an ICO, which initially involves a Private Sale (basically the rich getting richer), followed by a Public sale, where short time investors purchase tokens for ETH or BTC; an Airdrop takes away the payment bit of this process, instead and thus gives more value towards informing people of their offering, and giving every one the chance to own some tokens.
In an airdrop, tokens are allocated to existing holders of a particular chain typically Bitcoin or Ethereum, so instead of buying tokens, they’re simply given away to the holders of another coin.
ADVANTAGES OF AN AIRDROP
i. Breadth of Distribution
The earlier option involved an ICO, or an Initial Coin Offering, through which participants use BTC or ETH to buy tokens. However, the tokens ended up in the hands of a narrow demographic, usually just 30 or 40 thousand odd people. While there’s certainly a lot of money involved right here, there is very less of an awareness.
For a quick retrospect, Bitcoin and Ethereum have millions of users. An airdrop effectively puts your token in the hands of millions. Even if only 1% of users actually engage your project, you’ve likely achieved significantly broader distribution and more engagement than even the most successful token sales.
One of the ancillary but important benefits of token sales is that they help raise awareness for your project. At any given time, there’s a handful of ICO’s and coin hopefuls screaming for your attention. The ecosystem just isn’t designed to handle this, and in the end, only a couple projects, at the most, end up with the exposure they require.
However, your target community might be more likely to take a serious look at your project if they’ve been given a stake rather than the burden of making a purchase decision
People are in a different position when they’ve been given a stake and must decide what to do with it (Sell ? Hold? Buy more?). At the very least, this will typically encourage some portion of the community to educate itself about your project. In this sense, giving away tokens in an airdrop is similar to a guerilla marketing campaign.
iii. Fund Raising
While a handful of the highest-profile ICOs ultimately raised hundreds of millions of dollars, most raise a tiny fraction of those amounts. Unfortunately like traditional news, you end up listening to only the successes and never the failures.
Again, airdrops can be ( and have been ) at least as successful in this regard. There’s many potential approaches that a project could take here.
iii. Regulatory Risk
Perhaps the most important point of them all. A lot of regulator run-ins occurs when there is cold, hard cash involved.
The governments have shown us time and again, they are VERY interested and suddenly affected when a product is sold and revenues and being made and capital is being generated.
Eliminating this risk is simple - conduct an Airdrop. An airdrop could be the path of least resistance (and maximum effect), considering all the above noted points…
Eventually, airdrops became a method beyond marketing. As a method to pump coin value, coins would announce airdrops where coin holders would receive bonus coins proportional to the amount of total coins they hold.
Coin investors that wanted to get the airdrop would have to buy the coins if they didn’t have any yet, or buy more if they wanted a larger proportion of the airdrop. That being said, I want to emphasize that this airdrop strategy won’t be examined further in this article, since my article is focused on how you can get coins for free, not on how you can get coins by buying coins.
A while ago Token Start ups noticed that there’s a lot more value when their token is held on as many wallets as possible. More coins will most likely lead to more interest and exposure, which in turn greatly increases the Trading Volume of a particular coin when it gets listed on an exchange.
HE'S WHAT YOU NEED TO CATCH FREE AIRDROP
i. ERC20 Address
It has to be a personal address that is ERC20 compatible because most of the tokens that are airdropped are ERC20 tokens, which are or were originally Ethereum-based ICOs.
I will suggest you MyEtherWallet, Imtoken or MetaMask to get started immediately, but in the long-term it’s advisable you get a hardware wallet like the Ledger Nano S. The Ethereum wallet must be very ACTIVE. By active, I mean that you have to show at least some human use of it.
A lot of airdrops have checks in place to ensure that you aren’t just randomly generating a bunch of addresses and signing them all up to unfairly obtain more coins. This means that if your wallet doesn’t show activity, it might not receive the airdrop. Sometimes, coins will be explicit in what they look for, including some type of balance in the account.
ii. A Telegram Account
The coins want to boost the audience count and make it spread like fire. Usually, these airdrop coins will also require you to sign up for their Telegram accounts. Until you receive the coin in your Ethereum wallet, do not leave the Telegram accounts for whatever reason or you risk disqualification for the airdrop.
Participating in an Airdrop is very simple. When you discover, or are informed of an Airdrop, never hesitate to fill out a telegram form, give your Ethereum (or relevant coin) wallet address, and when it’s listed on exchange, you hit a jack pot when it booms
iii. A Twitter Account
This is also similar to the reasons behind the Telegram account. One of the prerequisite in obtaining the airdrop coins is that you’re required to follow them on Twitter. Some of them will even ask you to retweet some tweet.
iv. An Email address.
Most airdrops will ask for your email, too. If you don’t feel comfortable with giving them your real email, just create a spam one. Try to remember the password, though because some of them actually ask you to confirm your email.
v. Gather information about the coins
After getting the token, one of the first things you might have done was Google what the coin is. Or you might have taken it a step further to someone else if they knew what the token was. Also, you could just choose to ignore it.
HOW TO WITHDRAW TOKENS
It normally takes about 1–2 months after the end of the airdrop before you receive your tokens. However, this is primarily due to the fact that many airdrops occur before or during token sales, in conjunction to spread awareness. And tokens are not distributed until the end of a token sale.