What Are Crypto Airdrops? How Does It Work?
Crypto Knowledge

What Are Crypto Airdrops? How Does It Work?

written by John Murphy | April 6, 2023

Airdrops in cryptocurrency are a marketing stunt where coins or tokens are sent to wallet addresses to promote awareness of a new cryptocurrency. The answer to the question, what are crypto airdrops is a promotional strategy involving divvying out a free token to generate excitement and attract talent.

Key Takeaways

  • Airdrops in cryptocurrency is a marketing stunt used by new cryptocurrency projects.
  • Airdropping involves delivering tokens to the wallets of existing users or active users associated with the project.
  • The purpose of the airdrop is to increase public knowledge about the newly launched cryptocurrency.

The best crypto airdrops intersect blockchain and guerilla marketing strategies to achieve increased public awareness about a new startup. Since the crypto market is experiencing floods of new projects, airdrops in cryptocurrency are becoming popular.

Since the idea is to reach potential community members, thus it is achieved by offering rewards for their loyalty and getting investors’ attention. 

We will discuss the best airdrops in this article, so let us move forward and dive deep into the idea of airdropping.

Cryptocurrency Airdrops Working

Let us first understand how crypto airdrops work in the market. 

  • Launch A Campaign 

Once a new crypto project adopts an airdrop strategy, the first step is to launch a public campaign. The best way to achieve this feat is to perform a widespread outreach program across social media platforms like Twitter, Discord, and others.

  • Compile a List

As the campaign picks up traction, the next step is compiling a list of token recipients. Typically, companies gather data on active investors from the market and collect their wallet addresses to make a transfer. Moreover, companies also pitch influencers to motivate them to promote the project.

  • Gather Personal Information

Along with collecting wallet addresses, companies also gather their selected user’s personal information like email addresses or phone numbers. Letting them know about the project details and expanding the contact list is necessary.

  • Transfer Tokens

Airdrops in cryptocurrency are the transferring of tokens to selected customers. Generally, this transfer occurs through smart contracts or a self-executing program that runs automatically.

Users may wonder how to get crypto airdrops. Well, the answer is to keep yourself active in the crypto trade. Since projects usually select traders who are actively participating in the market.

  • Publish Traction Results

Once blockchain confirms funds transfer to intended recipients, projects tend to release a traction result report. It further promotes the new project and proves that the airdrop happened.

Types Of Crypto Airdrops

Another way to understand what crypto airdrops are is to look at different types and develop a clear understanding of this extensively used market strategy.

  • Standard Airdrop

Standard airdrop receives participation requests from interested participants. Individuals provide their wallet addresses to become part of the airdropping process. 

Since organizations have a set amount of distributable tokens, they select independently. Standard airdrop is famous for their simplicity; however, some are time-sensitive.

  • Bounty Airdrop

If users get paid upon completing a specific task for a new project, this type is known as a bounty airdrop. Generally, users from social media need to either make a post, tweet or tag their friends to get a chance to receive rewards.

  • Holder Airdrop

Holder airdropping occurs when existing clients holding tokens get new coins from the project. Since blockchain and wallet information is already with the project team, hence to incentivize their existing holders.

  • Exclusive Airdrop

It occurs when only selected users get tokens. The purpose is to target centralized rewards to only users actively participating in the project. Usually, the selection criteria depend on time spent, money spent, or non-token activity, like posts on a forum. 

  • Raffle Airdrop

Sometimes a project states several airdrops and encourages participants to earn them through a raffle ticket. Users can achieve these by holding tokens, showing interest, or earning points.

Once the number of interested users increases, the pre-set number of airdrops and a raffle occurs and rewards winners.

Advantages and Disadvantages

Airdrops in the cryptocurrency have both advantages and disadvantages.


  • Rewards early adopters or people who are actively involved in the project
  • Raises project awareness
  • Easy to execute
  • Low risk
  • Drives adoption
  • Rewards holders, which is not possible in an open market
  • Multiple airdrops options to choose from depending on the required goal


  • Poses security threats if transferred wrong wallet address
  • Sometimes appear as pump-and-dump schemes
  • May dissuade some investors
  • It may prove not very worthy if not executed properly

Frequently Asked Questions

What was the first crypto airdrop?

AuroraCoin (AUR) was the first cryptocurrency to launch airdrop on March 25, 2014. Since the coin targeted Iceland citizens, thus every permanent resident who submitted their ID received 31.8 AUR.

How can I find crypto airdrops?

Since crypto airdrops aim to raise awareness among general people, you can find them on social media or by subscribing to airdrop newsletters.

Can I make money from crypto airdrops?

Although the amount associated with airdrops is often minimal, thus it is not considered a source of handsome income from cryptocurrency. Likewise, there are high chances that received tokens are not highly liquid as they are relatively new.

Parting Thoughts

The best crypto airdrops serve the purpose of reaching out to the general public and getting them educated about a potential new cryptocurrency launch. It is a marketing strategy that is widely used in the crypto space as a number of new cryptocurrencies are lining up for a launch.

Moreover, airdropping increases the token’s liquidity as it gets disseminated to thousands of wallets. Although these are free giveaways, it proves worth it when users return to purchase newly launched coins.

Furthermore, airdropping is a straightforward concept and does not require professional support. Therefore an increased number of projects are adopting it. However, it is not risk-free as it bears the cost of a new project. If the liquidity is low, there are chances that the company may doom into oblivion even before reaching adulthood. So, project teams are advised to carefully study their marketing option before executing airdrops.

We hope you are now well-equipped to answer the question – what are crypto airdrops? Please leave feedback!