Airdrop (Cryptocurrency) - Explained
What is an Airdrop?
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What is Airdrop of a Cryptocurrency?
An Airdrop is used in Cryptocurrency to describe the free distribution of token or coin made to numerous wallets. Free distribution of virtual currency tokens or coins is often made to the wallets of community members as a reward or compensation for achieving certain tasks. Sometimes, airdrops are distributed to attract new followers and build a larger community. Airdrop is also defined as a distribution process through which a cryptocurrency enterprise sends tokens or coins into accounts of members for free.
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How Does Airdrop of Cryptocurrency Work?
Airdrop is often used in the cryptocurrency world as a promotional strategy by blockchain startups and emerging cryptocurrency enterprises. It entails the distribution of free coins and tokens to the wallets of community members to attract traction for their virtual currency projects and also build a larger community. Airdrop refers to a process used by a cryptocurrency enterprise to create awareness for its virtual currency project by distributing free tokens and coins to community members. Airdrops are free gifts distributed to wallets, they could be a reward for completing a task. There are certain eligibility criteria community members must meet before they qualify for the free tokens, these include;
- Holding a minimum quantity of the crypto coins in their wallet.
- Creating awareness for a virtual currency project such as posting promotional content on social media handles and others.
- Completing specific tasks.