Airdrops are the core marketing strategy for any crypto project looking to drive hype, organic growth, and present the project to an audience the fastest way possible. When executed correctly, they can be the most powerful hack in the crypto space.
For users, these events provide a lucrative opportunity to earn tokens by engaging with the project and becoming a part of the ‘early adopters’ clan, if they feel the project is worth rallying for.
In 2024, crypto projects airdropped tokens worth $15 billion to users across protocols!
Source: Dropstab.com
However, airdrops aren’t exactly a ‘𝐼 𝑔𝑖𝑣𝑒 𝑦𝑜𝑢 𝑓𝑟𝑒𝑒 𝑡𝑜𝑘𝑒𝑛𝑠, 𝑦𝑜𝑢 𝑔𝑟𝑎𝑛𝑡 𝑚𝑒 𝑦𝑜𝑢𝑟 𝑒𝑣𝑒𝑟𝑙𝑎𝑠𝑡𝑖𝑛𝑔 𝑙𝑜𝑦𝑎𝑙𝑡𝑦’ kind of marketing scheme. On the contrary, the airdrop game has changed completely. There’s too much noise. The crypto space has become bigger. Thousands of projects are vying to capture the attention of the users, engage them, and drive adoption.
But how do you know an airdrop isn’t a scam or soon-to-be-a-failure story? This article explains what crypto airdrops are, how they work, and how to get your hands on the best airdrops out there.
What Are Airdrops in Crypto?
For the uninitiated, crypto airdrops are a type of free token giveaway that blockchain projects use to market their projects, raise funds, and build a community of users. They are a strategic crypto marketing tool that projects use to distribute platform-minted tokens with certain governance rights or exclusive benefits to the wallets of early adopters.
These token distribution events are native to the crypto ecosystem and provide an organic way to bypass the ‘cold start’ problem most businesses face.
However, without a great airdrop plan, projects are heading towards failure. Most airdrops result in the recipients selling off the airdropped tokens shortly after the token distribution event. They must target value-creating users, be appropriately timed, and be based on meaningful interaction with the platform.
Source: BitcoinTalk
They are also a way to reward communities, encourage participation, or serve interim capital requirements. They can involve distributing tokens or NFTs based on a specific eligibility criterion, such as:
Holding certain crypto coins in the wallet
Performing certain tasks
Connecting with a particular member
Writing a blog or X post
Sharing posts or referring friends
Airdrops are mostly announced through official channels and cryptocurrency communities.
Here’s a YouTube video from DAppradar explaining Airdrops.
Evolution of Airdrops Over The Years
Auroracoin was probably the first crypto airdrop. Held in March 2014, it sought to distribute half of the token supply exclusively to Icelanders. Each qualified resident received 31.8 AUR worth of tokens.
Stellar Lumens launched its airdrop in 2017 in collaboration with wallet provider Blockchain.com. The protocol distributed $125 million worth of tokens to over 2.5 million wallets. XLM remains the most generous and largest airdrop in crypto history.
remains the most ideal airdrop to date. In 2020, the DEX distributed 400 UNI to any wallet that made atleast 1 swap on their platform. It remains the most successful airdrop as only 12% of the accounts with these tokens interacted with an exchange on the first day. UniSwap created the most sustainable and long-standing community, a feat achieved by very few other protocols.
were the five most successful ones in 2024. Many big ones are lined up in 2025. You can find out about the upcoming airdrop events in 2025 in this thread by X user @MercyDeGreat.
Types of Crypto Airdrops
Airdrops can be part of a crypto promotional campaign, an initial token offering alternative, or a crypto reward mechanism. Based on the purpose they serve, they can be of different types:
Standard Airdrops
These don’t have any specific eligibility criteria for receiving airdropped cryptocurrency. Interested users must express their interest and share a valid wallet address, and nothing more.
These all-inclusive token distributions are designed to create brand awareness, engage the community, or reward early adopters. While Standard airdrops can be a great Web3 promotional activity for brands, they are most prone to scams and rug pulls and Sybil attacks.
Free airdrops are often not free. Users must be cautious before sharing personal information besides their wallet address. The most classic example of a standard airdrop is UniSwap (UNI).
Bounty Airdrops
Bounty airdrops require participants to complete specific tasks, such as social media promotions. These tasks revolve around creating crypto brand awareness about the project, encouraging user participation, and building a community.
The tasks may be as simple as joining the project’s Telegram or Discord channel, following them on X, sharing/retweeting posts, referring friends, or signing up on their platform. The users who complete the tasks receive tokens as bounty rewards.
An example of a bounty airdrop could be Aptos (APT), where users who participated in the incentivised testnet were rewarded with cryptocurrencies. Hyperliquid distributed tokens to users who participated in perpetual futures trading and made referrals to the platform. Notcoin distributed tokens based on in-game activity and early participation.
Holder Airdrops
Holder airdrops are where tokens are given to individuals holding a specific amount of the project cryptocurrency in their wallets to qualify for the token rewards. The number of tokens received is a function of the amount and duration of coins held by the user.
In this kind of token distribution, users have full visibility into the free crypto allocation, as the wallet information is available for public view on a blockchain. While all existing token holders become eligible for the token distribution, some users may not be interested but have no way to opt out.
Blockchain payment network Stellar distributed 2 billion XLM tokens to existing holders and users of the keybase platform in 2019. Pudgy Penguin NFTs distributed their $PENGU tokens to the holders of their soulbound tokens as well as BAYC and Doodles NFT holders.
Exclusive Airdrops
Exclusive airdrops are targeted at specific community members or early supporters invited or selected by the project team based on certain criteria such as influence, expertise, reputation, etc.
The DEX platform 1inch distributed tokens to liquidity providers who interacted with 1inch DEXs. NFT marketplace aggregator Blur conducted an exclusive airdrop for high-volume traders and early adopters on its platform.
How to Find Crypto Airdrops
Airdrops are a great way to earn money in crypto through digital asset allocation. However, you need to know the right channels to learn how to get free token distributions:
Monitoring Official Project Channels: Information regarding the airdrop is mostly communicated on the project’s official social media channels, such as the X account, Telegram, or Discord channel. The official announcement can also be found on the project's official website. Many projects grant blockchain rewards to early users and communities.
There are loads of recommended reputable platforms that list upcoming airdrops, such as Airdrops.io, Airdrop Alert, Freecoins24.io, or Earnfi. You can also check out which has a dedicated Binance Airdrop Portal. Binance conducted 94% of the airdrops in 2024.
Engaging in Crypto Communities: Participating in forums and groups is crucial for finding information on these events.
Projects also depend a lot on disseminating favorable information around their airdrops to ensure their success. These events are decentralised token distribution and communities play a crucial role in spreading information, creating positive sentiment, and converting airdrop holders into long-term users.
X influencers like @mztacat, @CC2Ventures, @heycape_, and @CarbzXBT 's present their informed talk on the topic, which prove valuable for anyone intent on airdropped asset claim.
Forums help channel discussions around the good or bad of a current airdrop or point to an upcoming airdrop with huge upside potential. Here’s an interesting discussion around upcoming free token distributions on the Bitcointalk Forum.
Artists can also airdrop tokens representing rights over their music to the community to raise capital for producing a song instead of committing to a record label for years. The token or NFT holders can earn royalties once the song starts streaming.
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Gary Vaynerchuk, creator of VeeFriends and Chairman of VaynerX, airdropped one mystery NFT to anyone who purchased 12 copies of his book Twelve And A Half in 2021. Vaynerchuk received more than 1 million pre-orders within 24 hours.
Steps to Participate in a Crypto Airdrop
Once you know how to find crypto airdrops, the next step is to start participating in one. Let’s now answer how to participate in a crypto airdrop for earning blockchain-based incentives.
Setting Up a Secure Wallet
The first and obvious step is to set up a suitable wallet. A MetaMask or Phantom wallet would serve most airdrops. Fill out any form or registration links using your wallet address. Be careful while clicking on any links. Keep checking the community forums and social media accounts of the project for any new updates.
Meeting Eligibility Criteria
Each airdrop has a minimum set of criteria that an airdrop farmer or user needs to meet to become eligible. Be consistent and actively participate in social media or platform activities.
Different projects can have different sets of requirements. For instance, a chain would require you to set up a node, a project would require you to promote them on social media, a web3 game could ask you to participate in play tests, etc. Sometimes, the eligibility would be as low as holding the token.
Claiming the Airdrop
Once you have done what is needed, wait for the due date. The tokens get automatically transferred to your wallet if you are eligible. Check your wallet for the token allocation. You can also confirm the transactions using a blockchain explorer.
Best Practices for Maximising Airdrop Rewards
Staying Informed
There would be users who spend a lot of time and money on these token distribution events and would get a negligible return. There would also be users who, without having made any considerable efforts, might have won a bounty. Airdrop, as a digital currency giveaway, can be arbitrary.
The best bet is to see if any project you follow or look up to has hinted towards an upcoming cryptocurrency distribution. Keep an eye on the posts and official announcements. Double check any information coming via alternative routes, such as crypto influencers or random accounts.
Social scams are most rampant in airdrops. A random X user would tag you and claim your eligibility for an unknown or a known (but false) token airdrop. You might be asked to click on a link and follow the instructions to claim the rewards. Be wary, as those links might drain your wallet entirely of its assets.
Participating Actively
While active community participation is mandatory to keep a tab on such events and their progress, we often ignore actively participating in the actual protocol or chain. As such, we miss eligibility requirements.
If the token distribution concerns a dApp, use it often. If it concerns a chain, use at least 10 different dApps at different times over a few months. Take the eligibility requirements for any projects seriously.
The airdrop market is already diluted with a large number of farmers vying for the same share. Be consistent, be active. However, don’t make your crypto portfolio only about these free token distributions, as the Reddit user Cryptodad2100 says, “𝐷𝑜𝑛'𝑡 𝑒𝑣𝑒𝑟 𝑏𝑢𝑖𝑙𝑑 𝑦𝑜𝑢𝑟 𝑝𝑜𝑟𝑡𝑓𝑜𝑙𝑖𝑜 "𝑓𝑜𝑟" 𝑎𝑖𝑟𝑑𝑟𝑜𝑝𝑠, 𝑦𝑜𝑢 𝑤𝑖𝑙𝑙 𝑏𝑒 𝑚𝑎𝑠𝑠𝑖𝑣𝑒𝑙𝑦 𝑑𝑖𝑠𝑎𝑝𝑝𝑜𝑖𝑛𝑡𝑒𝑑. 𝐽𝑢𝑠𝑡 𝑑𝑜 𝑦𝑜𝑢 𝑎𝑛𝑑 𝑡𝑎𝑘𝑒 𝑡ℎ𝑒 𝑑𝑟𝑜𝑝𝑠 𝑎𝑠 𝑙𝑖𝑡𝑡𝑙𝑒 𝑏𝑜𝑛𝑢𝑠𝑒𝑠.”
Diversifying Participation
Track or engage with multiple protocols/chains to become eligible for many of these events at once. Most of these events today hold no value as the rewards are too diluted. Once you have identified a few good ones, stick to them. Don’t be a jack of all and Master of none.
Source: Bitcointalk
Avoid using too many wallets for a single airdrop. You might end up being recognised as triggering a Sybil attack rather than a genuine airdrop farmer.
Tax Implications
If the financial gain from an airdrop comes under the ambit of capital gains, then the crypto wallet rewards become a taxable event. Talk to your Chartered Accountant or local tax advisor to find out how much tax rate airdrop rewards attract in your country.
How to Avoid Cryptocurrency Airdrop Scams?
Scams are most rampant in airdrops--Phishing and social scams being the most common ones. To avoid falling victim to one, take note of the following:
DYOR - do your own research before participating
No airdrop requires you to share your private keys
Have a separate wallet for free token distributions or multiple wallets for different airdrops. Move your precious crypto stash to a cold one.
Don’t click on any unknown links. Triple-check website URLs before clicking on them
Don’t sign transactions without checking
Know the risks well and follow recommended security practices
When it comes to DYOR, you must note a few things around tokenomics, token allocation, and funding to confirm whether the token distribution event is worth taking a shot. Reddit user Prog132487 deep dives into what makes a good airdrop. Read here.
Conclusion
Airdrops remain an important cryptocurrency marketing strategy in the post-ICO crypto world. However, in the airdrops vs ICOs debate, there’s no conclusive winner. We can say that ICOs have evolved into Token Generation Events (TGEs) of which airdrops are a significant part.
Being an incentive-first ecosystem, most users are here for the rewards and price gains. If projects want people to look beyond that, they need to focus on usability and then educate the community about the same. Make sure a project is doing that, and you won't regret your decision to participate in its airdrop.
Interested in reading more such enlightening articles? Head over to NFT.EU to explore more.
FAQs
How do crypto airdrops work?
Projects design a set of criteria for the airdrop. These criteria may range from holding a specific number of tokens, social media or platform engagement, exclusive invites, or nothing at all. The users who pass the criteria receive the tokens in their recognised wallet addresses.
How to participate in a bounty airdrop?
Bounty airdrops mostly have the eligibility criteria of social media or platform engagement. You need to have a suitable wallet and complete the set of criteria needed, which may include resharing tweets, referring friends, using the platform, conducting trades, setting up a node, etc.
Are crypto airdrops free money?
Many crypto airdrops are free money as the tokens are disbursed without any considerable efforts on your part. However, today, with every project conducting an airdrop, the right ones are hard to grab and require considerable effort and time to complete eligibility tasks.
What are the Pros and Cons of crypto airdrops?
Crypto airdrops are the best way for brands to create awareness, reward active users, or build communities. Airdrops are a great crypto adoption strategy, but without the right plan, airdrops can increase selling pressure, price dilution, and very little community engagement.
What is the goal of crypto airdrops?
Airdrops can have varied goals ranging from Web3 marketing, community-led growth, incentivised participation, to simply letting users know the brand exists.
