Airdrop: a way of project’s promo

August 20, 2020

An airdrop is an event most often launched among the crypto projects and is all about distributing tokens to as many users as possible. The mechanics are simple - the project picks a certain amount of tokens according to its tokenomics and sends the funds to the crypto audience.

There are dozens of sources promoting airdrops from different projects as well as telegram bots sending tokens directly to users’ wallets.

You may check some from the list:

Cryptocurrency exchanges quite often launch airdrops to promote newly listed projects or dedicate them to events like anniversary/ release/ meetups, etc. As a rule, these activities are highly promoted so anyone following the exchange news may take part in airdrop promo.

This is a great chance for a user to join the project's Community. Usually, there are no additional requirements to get free tokens. However, sometimes participants are asked to subscribe to the project's social networks/ make a deposit, etc.

token airdrop

Why take part and airdrop and what to do with the tokens?

There are a few options, so anyone can choose the best of it:

  • Sell tokens on trades and forget about it
  • Hold it hoping that price will grow and sell it later to gain additional benefit
  • Deposit tokens in staking/ saving/ earning pools (if such features are available) and get guaranteed interest from the project

As you can see now, there are lots of benefits for the users when participating in the airdrop. But what about the project itself?

Pros and cons for a project launching an airdrop:

Token distribution in order to increase its circulation and capitalization on the market

+ Getting new token holders as loyal audience

Additional promo for the project and making it noticeable among the others on the crypto market

Attracting the obtained audience to trade with the project's token

- The project may not reach out its targeted Community as launching the drop may lead to token distribution among bounty hunters and a large number of funds may be concentrated in one hand

- Recipients of tokens during the airdrop do not appreciate free funds and try to sell them as soon as possible

- Price falls after new holders go to trades and start an immediate simultaneous sale 

As we can see there may be positive and negative influence when launching an airdrop. Thus, launching this service should be considered very carefully.

Coin listing on crypto exchange in 3 days

We highly recommend consulting with a financial advisor and trading team before launching an airdrop to evaluate all risks and profits and create a correct strategy.