None of the information in this article should be considered financial advice, but is for educational purposes only. Please do your own research (DYOR), and when in doubt, rather stay away.
The recent Aptos (APT) airdrop has been one of the rare highlights in a terrible year for crypto enthusiasts, as it netted some lucky recipients thousands of dollars, just like the Uniswap giveaway did in 2020. In 2022 for example, the Cosmos (ATOM) chain has made headlines thanks to a large number of airdrops they provide to users who stake assets within their ecosystem. While massive airdrop events do not happen every day or week, they do occur with some frequency, and in bear markets where the money’s tight and prices keep going down, a fistful of free coins of the hottest new cryptocurrencies can go a very long way. Are these recipients really lucky though, or just smart?
Well, a bit of both. Especially in bear markets, crypto projects use airdrops to reward early supporters and garner strong communities by making them token holders.
While it’s not always clear which projects will release new tokens, you can be assured that there are a ton of potential airdrops incoming, and with a bit of elbow grease, it’s possible to get in on the action. After all, over 110,000 people were able to qualify for some amount of APT tokens.
How did these people manage to get so fortunate? And more importantly, what can you do to potentially qualify for them?
Well, in general, the rules are simple: Add consistent value, and get rewarded.
Read on to learn about what an airdrop is, how they work, and where to go to find some info on the upcoming ones.
WARNING: Before we begin, we need to state the obvious:
Airdrops can be a minefield for newbies.
💀TREAD CAREFULLY AT ALL TIMES. 💀
Trying to gain crypto airdrops can carry a big security risk, as it can open you up to NFT and crypto airdrop scams and hacks if you interact with the wrong projects. You should never have to pay for an airdrop or pay an exorbitant amount in gas fees.
For all of the crypto to be earned, there is also crypto to be lost. The road to becoming a successful airdrop hunter is littered with the emptied wallets of those who fell victim to scammers.
So please stay safe, and do thorough research before you jump in. Usually, you’ll be able to deduce which projects are solid and which are not, for example by visiting their homepage, and checking out their Discord and Twitter accounts. Just to be safe though, create a new wallet with a very low balance where possible and use a device that doesn’t store critical data. Use a VPN if you can to hide your IP address from hackers. You can never be too safe when it comes to crypto.
Also, note that many of the airdrops come as a reward for supporting very early and often experimental software and protocol versions. So while the potential airdropper might not be malicious, their applications can still be buggy and their untested code can have potential security holes in them.
Got it? OK let’s move on.
What is a crypto airdrop?
A crypto airdrop is a marketing tool used by new crypto projects to incentivize people to use a given protocol. They are a marketing strategy used by companies in the blockchain space to gain users for their products.
The way it works is that people are “airdropped” tokens to reward their participation in some aspect of the early stages of a project. This can range from signing up for a newsletter to retweeting something from a company or performing a transaction on a platform.
Sometimes these tasks are simple and free, while other times you may have to pay transaction fees. The point is to get people to promote the product and boost its exposure. And for that, crypto companies airdrop tokens as rewards.
When the time comes, the company will instruct the users on how to claim the airdrop or it will automatically appear in a crypto wallet, such as your MetaMask or your CoolWallet.
Airdrops became especially popular after the 2017 ICO mania died down, with projects worried about being prosecuted as potentially unlisted securities. By handing out a big portion of a crypto’s initial circulating supply, it helps to put a big value on that asset, as the owners begin to trade it on exchanges and hype it up (shill!) on social media. The team will retain a portion of the total supply for themselves and sell them at a hopefully high price to fund their project in return.
Types of airdrops
Airdrops come in several forms and have evolved over the years to become more sophisticated in terms of the measures used to determine who qualifies and how much is dropped. Here is a list of the most common types of airdrops:
This is the simplest kind of airdrop. To participate in a standard airdrop, all you need to do is make an account with a platform, give them some details such as your wallet address, and then you’re done. This kind of airdrop may have limited tokens available because it is so popular due to its ease. It’s good to get there early for standard airdrops lest you fail to make the cutoff. Sometimes, the recipients of these airdrops will be selected via a raffle or lottery.
This kind of airdrop is based on whether you hold tokens of some other crypto. There is a snapshot taken of the number of tokens held at some particular moment or period, and then you are airdropped the new tokens based on the snapshot. Token holders will be automatically awarded the tokens regardless of whether they want them, and the size of the airdrop is often proportional to their holding of the other token. In practice, this means that smaller token holders may not get the airdrop.
The way to get a bounty airdrop is to perform a task for a crypto project. This may be related to social media, such as retweeting or liking or Twitter content. Or it may involve a task like joining a Discord channel. Sometimes there are also referral fees for steering others toward the project. This type of airdrop will often reward users proportionally to the amount of effort they’ve put in based on a point-scoring system.
What are NFT airdrops?
NFT airdrops are very similar to airdrops for coins. When a project organizes a non-fungible token (NFT) airdrop, it will often do it through a lottery. In other instances the airdrop may be organized for people who own a related NFT, as was the case when Bored Ape Yacht Club holders were airdropped Bored Ape Kennel Club NFTs. In a variation on this style of airdrop, Bored Ape holders were also given ApeCoins when those were first issued, which many sold for hundreds of thousands of dollars.
How to find potential crypto airdrops
Get the airdrop alpha on Crypto Twitter and Discord
Potential airdrops can be found by rooting around for active projects that have not yet released a token. Twitter is usually Destination 101 to find the latest “alpha” (breaking information) on these and also detailed guides on how to qualify for them.
There are many prominent Crypto Twitter personalities such as Miles Deutscher who make a habit of regularly posting leads about airdrops in order to increase their followership and engagement. Note that Deutscher, like many in the crypto space, often has fake accounts popping up that claim to be him. A list of upcoming potential airdrops from Deutscher can be found here.
All these upcoming airdrops may be cumulatively worth $10k+.
• Layer Zero
• Quai Network
$10k invested in a bear market can (conservatively) 10x to $100k next cycle.
— Miles Deutscher (@milesdeutscher)
Being active on Crypto Twitter and following credible accounts will help you to also get recommendations from Twitter and tweet guides on what to do. Here are just a few recent samples of airdrop guides (try them at your own risk):
ECOSYSTEM AIRDROPS 🪂
In this thread, we are compiling our recent threads/blog posts about some #airdrop strategies. More threads may be added later. 🧵
💜 Like and 🔁 Retweet 👇 pic.twitter.com/hdHwpzm6LH
— Alpha Drops (@MyAlphaDrops)
Ethereum and other L2 Blockchains Retroactive #Airdrop guidelines.
Like i promised, i have published some good Retroactive #Airdrops for solana, today is #ETH
This includes for protocols on Arbitrum for #Airdrop
A thread 🧵
— BMS (@bloomstarbms)
Metamask Airdrop Guide 🪂
The $MASK token has been hinted for months. Don’t miss your chance at getting one of the biggest airdrops in crypto.
-A Quick Guide on how to qualify for the $MASK token.
— Emperor Osmo🧪 (@Flowslikeosmo)
Where do Twitter pros find their alpha? Well, by digging into the Discords of projects where early information may be shared (please stay safe on Discords as they are also prime territory for scammers).
Another way people find airdrops is to use special sites that track ongoing or potential ones, the latter of which are often expected but unannounced. Sites like Earnifi and Airdrops.io perform these functions, however, be careful which airdrop sites you visit or share information with, as it can be littered with spyware or be phishing attempts to get valuable information from you.
These sites may give their opinions on the trustworthiness of a particular airdrop, but it’s still crucial to do your own research.
A reputable source for crypto airdrops is DeFiLlama.com, which you can view here.
How are crypto airdrops dangerous?
Airdrops are a risky terrain and those seeking them are advised to use extreme caution. For every legitimate airdrop that gives users a pile of free crypto, there is a fraudulent account out there posing as the same project – and often more than one.
Be very mindful of where you get your tips, and always triple-check that you are following legitimate accounts. One useful safety trick many people use is to create separate crypto wallets for pursuing airdrops; that way, if the wallet is compromised, the losses are contained.
Another thing, if you find that you’ve received a free airdrop from a project that you’re not familiar with, don’t just interact with the tokens. Check them out on Google and Twitter and verify the contract address on a blockchain explorer like Etherscan.com.
In 2018 the author was given a tip by a friend to provide his email address to a new project that launched, Ontology (ONT). He missed the deadline by a few hours and had to watch in horror when the project gave everyone who signed up 1000 ONT, which soon traded for $12 each on Binance despite the grim bear market that year. The lesson learned: If you’re going to try and join an airdrop, be proactive and start early. Don’t wait till an airdrop is confirmed, because it likely means that the project had taken a snapshot months ago already and you and a crowd of other latecomers have missed the boat. Jump in and get your hands dirty as soon as possible.
Even though it’s heavily technology-driven, crypto thrives on human participation in order to first survive and then thrive. So if you’re low on crypto and free funds, but have some free time, do some research, find projects that you think are interesting, and add value to them by interacting, testing, sharing on social media sharing and becoming a strong team player.
If you play your cards right, that value might just eventually find its way back to you 10-fold or more.
This content was originally published here.