What is an Airdrop?

An airdrop is a marketing strategy that involves sending free coins or tokens to wallet addresses to promote awareness of a new virtual currency or project. It's often used by blockchain-based startups to bootstrap their projects and create a community.

How Airdrops Work

• Standard Airdrop: Users receive free tokens just for having an address on a specific blockchain (e.g., Ethereum).
• Bounty Airdrop: Users receive tokens for completing small promotional tasks like sharing a post on social media, joining a Telegram group, or referring friends.
• Holder Airdrop: Tokens are distributed to individuals who hold a certain amount of another specific cryptocurrency in their wallets.
• Exclusive Airdrop: Tokens are sent to designated wallets, often loyal community members or early supporters.

Purpose of Airdrops

• Generate Buzz: Create excitement and awareness around a new project.
• Reward Early Adopters: Thank initial supporters and community members.
• Wider Distribution: Disperse tokens to a broad audience to encourage decentralization.
• Data Collection: Sometimes used to gather user information (though users should be cautious).

Considerations

While potentially lucrative, users should be wary of airdrop scams designed to steal private keys or personal information. Always do your own research (DYOR) before participating.

Related Terms

• Token
• Wallet (Implicit - needs creation)
• Blockchain
• DYOR (Do Your Own Research)