Crypto Airdrop 2022 Complete Information | Cryptocurrency

Crypto Airdrop Complete Information | Cryptocurrency
Crypto Airdrop 2022 Complete Information | Cryptocurrency

Crypto Airdrop: Why would anyone give up crypto and How do I get Airdrop?

What is Crypto Airdrop?

New DeFi projects are launched every day. Many of these also launch with tokens. This has led to the rise of ‘airdrops’ to attract people to these new crypto ecosystems.

An airdrop is when a cryptocurrency is distributed to a group of people for free. Most of the airdrops take place on smart contract platforms such as Ethereum (Crypto: ETH), Binance Smart Chain (Crypto: BNB) and Avalanche (Crypto: Evax).

Each airdrop has its own characteristics. Some airdrops are random and do not require any action by the user. For example, you can check your Ethereum or Binance Smart Chain wallet and see a new token that you do not recognize. Because anyone can create a new token and send it to an address, these types of airdrops are not uncommon. However, you must do due diligence when interacting with tokens that have been unexpectedly dropped in your wallet.

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Other AirDrop may require that the user has met certain criteria. During the Uniswap (CRYPTO: UNI) airdrop, 400 UNIs were airdropped for anyone using the protocol before September 1, 2020. The 1inch (CRYPTO:1INCH) protocol also airdrops tokens based on historical usage of the platform. Both of these airdrops cost thousands of dollars – but this is the exception, not the rule. Additionally, the criteria for these airdrops were not announced in advance so that no one can play the system to collect tokens.

“Surprise” airdrops such as UNI and 1INCH airdrops can be a windfall for users of the platform, but they are also unpredictable and down to luck. During these airdrops, only the early adopters of the project got some. Because the criteria for an airdrop depend on the team behind a project, there’s no way to tell what a surprise airdrop will look like — or if it will happen at all.

Many tokens are airdropped in exchange for users performing simple tasks. These tasks may be following the project on social media, writing a blog post, or otherwise promoting about the project. Occasionally, people holding a predetermined minimum amount of tokens will receive an airdrop. These airdrops are announced in advance.

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But why would anyone give up crypto?

The multiple airdrops are an attempt to distribute the tokens fairly. When a large project launches a token – as in the case of Uniswap – an airdrop rewards previous users who helped the project grow. This can help attract new users, who use the platform with the hope of being rewarded. An airdrop may be seen as good manners by the community. If a successful project launches a newly minted token without an airdrop, it can be considered a turn away from the early investors who popularized it.

Some airdrops also target investors who can bring value to the project. For example, one DeFi project may use airdrops to lure in another’s customers. The 1INCH airdrop is aimed at trying to persuade Uniswap users to switch to the competing 1inch platform.

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Airdrops have also become a common marketing tool for new DeFi startups. Today, many airdrops are announced in advance, or are rewarded in exchange for likes and shares. Many development teams use the engagement that an airdrop announcement makes to help get their project off the ground. This is typical for small projects with no history or speed. As a result, the value of airdrops is generally low. If the project picks up, the value of the token is likely to appreciate – making the airdropped amount more valuable.

How do I get AirDrop?

Most of the big airdrops are down to sheer luck. Some require that you are in the right place at the right time. However, anyone can capitalize on the airdrops already announced. These airdrops typically require users to do something simple, such as share a social media post or use an app or platform.

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Some websites like CoinMarketCap offer an airdrop calendar for new projects, and several websites are dedicated to highlighting new airdrops. Several projects announce airdrops on their Twitter (NYSE:TWTR) feeds, and have Twitter and Telegram accounts dedicated to tracking the latest airdrops that have been announced.

Anything else I should know about Crypto Airdrop?

While airdrops are free by their nature, they may require users to complete tasks and may have in-network transaction fees. This may vary by project, and users should exercise discretion for this reason. Before participating in an airdrop, users should research a project to make sure it is legit. In particular unexpected airdrops should be investigated. Do not interact with the token or project if you are not sure it is secure. If it sounds too good to be true, it probably is.

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Airdrops may have related tax or legal implications, depending on your jurisdiction. Some airdrops require the user to claim them voluntarily, and some are airdropped automatically. Make sure you are familiar with the legal status of any airdrop you intend to participate in.

Source: Benzinga, Investing, Direct News 99 

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