What Is Crypto Airdrops?

As we observe Online Trade is getting more popular day by day, hence, demand for cryptocurrencies is also increasing at the same pace. This ultimately leads to the formulation of new virtual currencies or tokens for trading. But, have you wondered what happens to a newly introduced virtual currency? How do the users know about this new currency? Well, there is a mechanism to resolve this problem. It is known as the “Crypto-Airdrop”.

What is an Airdrop?

In the world of digitized trading systems, an airdrop is the token of newly developed virtual currency which is distributed to hundreds or thousands of wallet addresses to make the trader acquainted with this new currency. It is similar to a new shop where the shopkeepers provide their customers with the samples to try, before buying/selling.

Why do Crypto-Airdrops Happen?

Crypto-Airdrops are generally used for the promotion of a start-up or a new digitized business based on blockchain. Its basic purpose is to attract more and more traders by initiating them into the business through the Initial-Coin-Offering. Another way of offering such newly minted tokens is by exchanging them for the some-or-the-other task assigned to the customer, like following their websites and sharing the post about the currency on social media, and promoting the new business through various activities.

Governance of Token Airdrops

There are various ways in which the Airdrops are distributed:

• By transferring a small number of cryptocurrencies to the wallet addresses of wallet users for free. It requires the trader to simply sign-up with the new platform and hold a wallet in it.
• By rewarding the wallet holder for some kind of promotional activity.
• By providing exclusive airdrops to the loyal users of the platform.
• By distributing the tokens to the wallet-holders with a certain amount or balance in his/her wallet, which makes them eligible to get some valuable airdrop.

WARNING –

People can run Pump and Dump scams using Airdrops. There are also the chances of having your private account hampered or even dismantled by the scammers by falling prey to fake airdrops. Such scams are popularly known as ‘Dusting scams’.

NOTE –

A legitimate crypto airdrop never asks for any investment in the currency. Its aim is purely promotional.

Final Thoughts

Having known all about promoting new virtual currency through Airdrops, anyone interested in owning or introducing a new online marketing platform can mint a new token and promote the brand using Airdrops. Airdrops play an important role in creating awareness about the new platforms and getting more and more participants in the new blockchain realm.