have an account?【sign in】What is an Airdrop? Understanding Cryptocurrency Airdrops and How They Work
noureddineauthorAn airdrop is a distribution of cryptocurrency tokens or coins to users who meet certain criteria. It is usually done by developers or projects to promote their token or coin or to build a community around it. Airdrops can be a valuable way for new projects to get off the ground and for existing projects to grow their user base. This article will provide an overview of what an airdrop is, how they work, and some examples of recent airdrops.
What is an Airdrop?
An airdrop is a distribution of cryptocurrency tokens or coins to users who meet certain criteria. It is usually done by developers or projects to promote their token or coin or to build a community around it. Airdrops can be a valuable way for new projects to get off the ground and for existing projects to grow their user base.
How Airdrops Work
Airdrops work by using a smart contract, which is a computer program that runs on a blockchain. The smart contract contains the rules for the airdrop, such as the amount of tokens or coins to be distributed, the date when the airdrop begins and ends, and the criteria for qualifying for the airdrop.
When a user meets the criteria, they will be added to a list of eligible participants. When the airdrop ends, the tokens or coins will be transferred from the developer or project's wallet to the wallets of the eligible participants. The distribution can be weighted based on different factors, such as the number of followers on social media or the number of referrals made.
Examples of Recent Airdrops
1. TokenSoft Airdrop
In June 2021, TokenSoft, a blockchain-based regulatory compliance platform, conducted a US dollar-denominated airdrop worth over $1 million. The airdrop was open to anyone in the United States who created an account on the TokenSoft website and completed a short survey. The goal of the airdrop was to promote awareness and adoption of the TokenSoft platform.
2. Binance Coin (BNB) Airdrop
In 2019, Binance, a leading cryptocurrency exchange, conducted a BNB airdrop worth over $500 million. The airdrop was open to all Binance users who held at least 100 BNB tokens at the time. The airdrop was worth 50% of the BNB tokens held at the time, with the remaining 50% being distributed based on trading volume on the Binance exchange. The airdrop was a successful way for Binance to grow its user base and increase the value of its token.
3. Tezos Airdrop
In 2017, Tezos, a decentralized blockchain platform, conducted a US dollar-denominated airdrop worth over $23 million. The airdrop was open to anyone in the United States who contributed to the Tezos token sale between July and August 2017. The airdrop was worth 5,000 Tezos tokens per participant, with a cap of 100,000 tokens per person. The airdrop was a successful way for Tezos to grow its community and fund its blockchain development.
Airdrops are a valuable tool for cryptocurrency projects to grow their community and increase the value of their tokens or coins. By understanding how airdrops work and keeping up with recent airdrops, cryptocurrency investors and enthusiasts can take advantage of these opportunities to add value to their portfolios.