We might have come across this time or would have seen it attached to some ICO's. Am talking about airdrops and for this reasosn, we might have wondered what they really mean. Some might think airdrops are the dropping of coins by a plane in the sky, or probably a rises or calamity just occurred that might have claimed some lives and properties in areas that are difficult to approach by land, that's where the airdrops comes in. It helps in supplying things to those that are trapped in those districts, but that's just in real life and outside the crypto world.
In cryptocurrency or the world of crypto, the word airdrops have a different meaning all together. The cryptocurrency world is know for it's incomparable lexicon which enlarges the market over time. In this post, i'll try to explain everything you need to know about airdrops.
Definition
An airdrop can be defined as the process by which a crypto firm gives out tokens to some of their customers for free. The act of airdropping is mostly carried out by blockchain-based startups to enhance a lot of traffic to their cryptocurrency projects. Airdrops are mostly carried out by confirmed blockchain-based enterprises like cryptocurrency exchange platforms.
Reasons for carrying out airdrops
One of the crucial reasons about bringing airdrops are mostly as a means to reward their loyal customers. Basically, thee are several reasons why a cryptocurrency airdrop is being carried out. But well just highlight two crucial points;
- As a reward for loyal customers
From time to time, the blockchain-based services like wallet service, trading platforms, desire to give back some goodies to their loyal subscribers and customers. In order to reward their loyal customers, airdrop was introduced with free cryptocurrency attached to it. It functions as an encouragement for patronizing their project.
In 2017, the cryptocurrency exchange platform, Binance, carried out an airdrop of 500 TRX cryptocurrency to account holders on the platform. The airdrop lasted from the end of October 2017 to the middle of November 2017. In order to qualify for the airdrop an account holder needed to have at least 0.003 BTC in addition to having completed at least one transaction on the account. Binance account holders who had the equivalent of 0.003 BTC in other cryptocurrencies were also eligible for the airdrop as long as they fulfilled the transaction requirement.
- To create awareness about a new cryptocurrency
We all know cryptocurrency market to be very large and gigantic, no doubt a new coin can absolutely be unnoticed if it isn't given the proper boost as per the substantial marketing campaigns. Whenever a new product is out, the first thing they involve in is advertisement, making the product known and also most organizations go as far as giving free products, or indulge in the ''buy 2 and get 1 free technique''. Same is applicable for for any new cryptocurrency that wants to gain more customers. All the same, for any new cryptocurrency searching for a new crypto options, an airdrop is the best way to attract more users to your crypto project.
And that's it for today guys, having read this i hope we can now get the real meaning of what an airdrop is and knowing it's functions whenever we see one attached to an ICO.
Thanks for reading my post