Everything you need to know about free launches of tokens and digital assets. Why they are given away and what are the most common variations in this practice?
What is NFT Airdrop?
An NFT airdrop is the free distribution of non-fungible tokens to a blockchain community of interest.
Just like in other sectors and businesses, the launch of free products is a promotional action. The purpose is to give visibility to the asset, such as an NFT.
Airdrops are not exclusive to NFTs: cryptocurrencies and other tokens are sometimes sent.
Keep these facts in mind:
- It is usual for airdrops to revolve around newly created assets.
- These launches are generally used to add value or to draw attention to a brand or experience.
How does an NFT airdrop work?
The functioning of an NFT airdrop is based on the logic of a promotion, in which the initial gifts aim to provide visibility and future profits.
Although these launches are based on traditional marketing schemes, there are a number of different aspects to consider.
- During the NFT airdrop, the tokens are sent to addresses chosen by the responsible parties of the promotional action.
- In some cases, the gift arrives at user addresses that did not request the NFT.
That is why some compare the airdrop of digital assets to “buzzing”. Why? Look.
That is an expression of marketing that refers to the placement of printed advertising notices in mailboxes of people who are considered potential customers.
What types of NFT airdrops exist?
There are variations of NFT airdrops, depending on the target audience, the digital asset being given away, or certain specific instances of the projects. Let’s see the most frequent ones.
Standard or “task” airdrops
- It is common to ask for an action in exchange for the gift, but not money.
- For example, completing a form, sharing a post on social media, joining a whitelist, subscribing to a newsletter, or providing an email address.
- The assets are usually new and unknown, hence the need for promotion.
- Do not expect airdrops of known assets like Bitcoin or Ether.
- It is a “win-win” action: the managers receive a boost, while the user gets an asset that could potentially increase in value in the future.
- Typically aimed at loyal users of a community.
- Unlike standard airdrops, the managers make a selection of recipients.
- So it is considered more of a reward than a gift.
- In these cases, it is not common to ask for an “action in return” as previous loyalty is rewarded.
Hard fork airdrops
- Occur when there is a new version or fork of a blockchain chain, and a new token is created.
- These are focused on non-fungible tokens, which as previously reviewed in this blog, are different from cryptocurrencies proper.
- They can be channeled through deliveries or through drawings, among other modes.
- They are also marketing strategies, in this case for collections of certificates of ownership of unique digital elements and with a determined value.
- Some cases of NFT airdrops are famous, for example, those within the Bored Ap Yatch Club collection.
Why are NFT airdrops important?
NFT airdrops, in particular, and digital assets in general, are important to the web3 community in terms of their promotional character.
As noted above, they offer project managers a way to make them known, and users the possibility of having values in a free form.
NFT and cryptocurrency airdrops are launch platforms with the potential to lay the foundation for successful initiatives.
They are also user loyalty campaigns, sometimes rewarding them for their loyalty and also deepening their identity with brands and projects in communities.
When thinking about why NFT airdrops are important, it is also worth mentioning that they are actions that attract the attention of the media and, thus, further expand the visibility of the promoted assets.
Finally, an airdrop is a conducive way for different assets (NFTs, tokens, virtual coins) to begin being used by real users, boosting their economic activity.
How can one participate in an airdrop?
To participate in an airdrop, the user must have a minimum amount of digital assets, such as NFTs, or have used services that qualify them to receive the recognition/gift.
It is also necessary to have a wallet to receive the asset in an airdrop.
As we mentioned in “What types of airdrops exist?”, sometimes it will also depend on the choices of the project managers, who create exclusive lists.
How much can one earn in an airdrop?
The question splits into two main aspects.
- On one hand, for the managers of web3 projects, airdrops allow for earning through the promotion of assets, user loyalty, and the expansion of the community.
- For users who receive an airdrop, the decision is given by the subsequent performance of the asset.
In any case, there is no single answer for how much one can earn in an airdrop. In some cases no profits are perceived, and in others there are juicy returns.
A remembered example among the latest (those that generated good yields) is the Mutant Serum airdrop from the Bored Ape collection.
As the One37PM site recalls, the NFTs of the series were released for free to some collectors, and in January 2022 one was sold for the equivalent of almost $6 million.
Following the source, not all NFT airdrops are valuable, as some can be simply useless and in some cases frauds. To avoid these latter ones, we recommend readers check our article “NFT Scams: What they are and how to avoid them.“