Cryptocurrency Airdrop can be a new term for you, but it has been there that is frequently used to attract crypto users. In simple words, cryptocurrency airdrop is a unique marketing tool that is mainly used to send out free tokens to wallet addresses. It is like a small amount of newly minted tokens or virtual currency to the wallets of the active members of the crypto world. The main idea of this Cryptocurrency Airdrop is to encourage crypto traders to buy a new token or coin. Learn more about Digital Innovation with blockchain by clicking here.
In this blog, we will learn more about Cryptocurrency Airdrop and understand how it is used as a marketing method by startups in the Crypto world.
Understand What it is and How it is used?
Overview of Cryptocurrency Airdrop And Its Functioning
A cryptocurrency airdrop is generally a promotional method to engage crypto participants with virtual currency. It is used by blockchain-based startups to bootstrap a new token. This raises awareness about the cryptocurrency project to trade on exchange platforms.
This promotional activity is not predominantly used to make the recipient spend money but to raise awareness on the company’s website, social media, and cryptocurrency forums. The concept is simple’ which is to receive free tokens or coins in their wallets, users need to perform specific tasks, which are:
- Follow social media accounts
- Utilize hashtags when sharing or reposting content
- Perform transactions using a specific cryptocurrency platform or wallet
- Sign up for an account and stay updated
This gift may require a recipient to hold a minimum amount of cryptocurrency. They can be asked to write a blog post or connect with a member of a specific blockchain-based project.
How Crypto Airdrop was Created and Why?
The principal idea behind launching a crypto airdrop is to advance a blockchain venture, initiative, or offering. New startups can issue tokens to users to bootstrap its project and give a fair price of tokens to the community from the initial days. If more users are interested in the token, its price will likely hit the highest market.
Recipients will be incentivized to increase awareness about this new token or cryptocurrency. They can help engage more audiences when trading on an exchange. Users will only be asked to invest in genuine cryptocurrency airdrops. As an alternative, it allows you to distinguish yourself from rivals who sought outside funding before releasing their tokens.
What is the process of Crypto Airdrop?
The Crypto Airdrop is nothing more than a pump-and-dump scheme. The crypto creator issues a token and uses this promotional strategy to create hype before it will be listed on the exchange. The process of airdropping is ast listed below.
Check out the detailed steps to have an overall better understanding!
- The process starts when a company issues a token and decides to airdrop to wallet addresses. It can be in the form of incentivizing existing investors or promotional activity.
- The next step is how the airdrop will be facilitated and the eligibility criteria for choosing investors or token users.
- Launch the public campaign, which follows gathering email addresses, finding wallet addresses, and other interested parties. Include all to a contact list and increase the no. of users.
- Next, startups and companies will decide on the list of airdrop recipients. Once the list is selected, the airdrop is often facilitated through smart contracts. The airdrop distributes the recipients in the transaction. To show that the airdrop is equal, the company frequently makes the transaction block public and may use its Treasury wallet to conduct the airdrop.
- Often, airdrop recipients don’t have to accept the tokens; they receive the cash or tokens straight. To view their wallet balance of the token correctly, some people may need to add the token or coin and its address.
Conclusion
Now, you have learned what Crypto means and how it works. If you are a crypto trader, you may also receive airdrops depending on your portfolio and qualification. Look at this site for bitcoins trading for beginners who still need to start Crypto trading. You can open your wallet in the Bitcoin era.
