What is an Airdrop?
What is an airdrop?
An airdrop is when a cryptocurrency distributes its tokens for free to certain wallets or to users that sign up for their airdrop. For example, if one were to own some Neo back in February 2018 in their own wallet (not on most exchanges), they would have received .2 ONT per Neo that they held. Odyssey demonstrates the other type of example, which if a user tweets about Odyssey, follows them on Twitter, and joins their Telegram group, they would receive two OCN tokens.
Why would a cryptocurrency give away their tokens for free?
Giving away free coins may spur some interest and curiosity about a currency. If one were to notice two free tokens in their wallet, they may be inclined to google the token and learn about its project. An airdrop that requires an email address, tweet, Telegram page, Facebook group, etc., will help promote the coin and help the cryptocurrency’s team communicate future announcements.
Is there a catch?
- Giving away tokens to people who did not elect to buy those tokens will be likely to sell them. If a new token airdropped their coin to Ethereum holders, somebody who owns a lot of Ethereum could sell all their new token at once, dropping the price of that new token.
- Fraudsters will try to trick people into giving them their private keys or cryptocurrencies in return for a fake airdrop. Be careful. Legitimate airdrops will never ask you for a private key nor any amount of cryptocurrency.
When is the next airdrop?
Coinmarketcal tracks cryptocurrency events and airdrops and is a good site to learn about upcoming airdrops.