Airdrop

What Is a Cryptocurrency Airdrop?

An "airdrop" refers to a method of distributing cryptocurrency to the public, via the fact that they own certain other tokens or wallets on a particular blockchain. This is usually done for marketing purposes to incentivize the holding of other tokens or induce them to become a participant in the blockchain network.

Airdrops usually work by requiring users to hold a certain amount of tokens in a publicly discoverable wallet at a predetermined time (snapshot time). The token project conducting the airdrop would then use the snapshot to distribute the airdrop tokens accordingly.

The effect of airdrops allow users to diversify their cryptocurrency holdings, spread awareness of the airdropped token and earn an effective dividend (of their previous holdings). Most airdrop campaigns run with mechanics such as receiving coins or tokens in exchange for simple tasks like sharing news, referring friends or downloading an app.