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How to Make the Most Out of Crypto Airdrop

  • Crypto airdrops are giveaways of small token amounts.
  • Airdrops are a legit marketing tactic, however, discredited by scammers.
  • Crypto airdrop scammers steal private data, private keys, and cryptos.

Everybody loves to get something for nothing. This is why free cryptocurrency giveaways, or simply crypto airdrops, are one of the most common targets of cryptocurrency scammers.

Scammers trick victims into disclosing their personal data, giving away money, or even worse—the keys to their main cryptocurrency wallets.

In this article, you will learn about how to recognize the most common scam types of cryptocurrency airdrops, and how to claim free tokens safely.

What Is an Airdrop in Crypto?

A cryptocurrency airdrop is a widely used term in the world of crypto. Simply speaking, it is a giveaway of tokens or coins for the loyal crypto community.

It is a common marketing strategy used by start-ups to create initial awareness, gain more followers, and create a user base.

For the crypto community, an airdrop is a legitimate way to gather new coins for free or in exchange for small tasks like social media follows or referrals to friends.

For crypto projects and start-ups, it is a business tactic to gain resources and put a value on their tokens, sometimes even before the initial coin offering (ICO).

How Do You Find out about Crypto Airdrops?

To win some free coins, you need to find upcoming airdrops. Crypto projects themselves do announce upcoming crypto airdrops on their websites or social media, which works if the project already has a community.

For those who are looking for new gems, there are websites like AirdropAlert or Airdrops.io that constantly publish information about upcoming cryptocurrency airdrops. And mega players like CoinmarketCap also have a crypto-airdrop section to look through.

Scrolling crypto-focused social media channels and forum groups can also help you find airdrops, but keep in mind there could be more scam projects airdropping, so the risk is a bit higher.

How to Claim a Crypto Airdrop

  • Sign up for airdrops: create an account or fill in a special form on the project’s page. Usually, registration requires you to provide your name or social media account, email, and crypto wallet address.
  • Follow the instructions to claim free tokens. The airdrop issuers always provide the list of tasks you have to complete. Typically these are requests to follow their social media accounts and share and retweet posts within a limited time period.
  • Link your crypto wallet address. This is necessary as it is the only way to get tokens if you earn them. Keep in mind that giveaway coins are built on different blockchains, so your wallet has to support the same token standard.
  • Just wait. Do not forget though that crypto airdrops are like a lottery. They are distributed randomly, and completing the tasks does not guarantee your wallet will be credited.

What Are the Dangers of Crypto Airdrops?

Crypto airdrops are legit means to raise awareness of a project. But as any legit and effective tool, it is also widely exploited by scammers.

It’s no secret that some airdrops are simply a scam, created to steal your private data or cryptocurrency. You should always stay vigilant and take every crypto airdrop with a grain of salt.

As scammers have different goals, fake crypto airdrops can be classified according to these goals. Here are the most common categories of crypto airdrop scams:

  • Data gathering. Fake crypto airdrops imitate legitimate projects to bring users into scam websites. They gather your personal information here, like name, email, passwords, or wallet addresses. Scammers later sell such data or use it for social engineering attacks.
  • Private key gathering. This is a less common, but no less dangerous type of airdrop scam. Scammers ask you to download their app to register for the airdrop and then to import your private key. Even though they claim that private keys are not stored on their apps, even the idea of asking for a private key should raise a red flag. Private keys are supposed to be private, and you should never ever share them with others.
  • Pump and dump purposes. Another common type of scam, pump and dumps create hype around certain coins before they come to exchanges. As soon as coins get listed and the price spikes, token issuers sell their assets with no intent to develop the project further.
  • Referral credits. Scammers collect your sign-up data and use it on other websites, where they get referral credits for bringing you in. This is the least dangerous type of scam; however, it still consumes your time and effort for nothing.

How to Claim Airdrops Safely

  • Verify websites. You’d be surprised how often scammers impersonate legit crypto projects and create fake websites and social media accounts that mirror genuine projects. Always do your own due diligence and check if the airdrop registration URL matches the official one.Of course, do not stop with domain checking. It’s best to investigate the whole project. Some red flags are an anonymous team, incomplete details about the crypto project, unclear airdrop steps, or a website that looks unfinished, slightly different than the original brand, or stuffed with broken links.
  • Avoid registration via third parties. Sometimes airdrop issuers ask you to fill out a registration on online survey administration software, like Google Forms. Legit crypto projects seeking to establish themselves in the market invest in their digital presence and usually do not use low-cost solutions, as it could damage their reputation.
  • Never share your private keys. Legit crypto players do not ask for private keys that give them permission to open your wallet and send your cryptos. Private keys are not public keys, which act as your wallet address. There is absolutely no legitimate reason why airdrops would ask for private keys in order to send you free tokens.
  • Avoid promises of high rewards. Typically airdrops are massive giveaways of small token amounts. Whenever the project promises rewards that seem too good to be true, it most probably is a scam that wants to trick you. Scammers promise a lot of coins, and when the time comes to deliver on their promises, they simply apply new terms and conditions or ask for a higher deposit to get tokens that were supposed to be for free.
  • Beware of airdrops that ask for donations. A common scammer tactic is to gather deposits from users that are claiming tokens from airdrops. Typically they ask for small amounts of crypto allegedly to compensate for high network fees that they need to pay for token transferring to your wallet. However, the purpose of a crypto airdrop is to give coins for free and not ask you to pay money for participation. All legit airdrops include transfer fees into their expenses.
  • Never download unknown wallets. Trustworthy crypto projects never ask you to download apps to get free tokens. If the airdrop of a young and small crypto startup asks you to do this, take it as a warning sign of an unsafe project. The unknown wallet might be simply malicious software that threatens to steal your private keys and thus cryptocurrency funds.
  • Create separate wallets for airdrops. Even if you are aware of potential risks but decide to claim airdrops anyway, keep your main wallet separate from those participating in airdrops. You never know what may happen. Creating a dedicated wallet, email address, or social media account to apply for airdrops will help you minimize the risk of losing your funds or private data. Also use 2 Factor Authentication (2FA) on your wallets.
  • Trust your gut and common sense. If you feel that something is not right or too good to be true, trust your gut and stop.

On The Flipside

  • Apart from being crowded with scams, airdrops are criticized for attracting users with no genuine interest in the project. In other words, airdrops attract speculators, but not long-term holders.

Why You Should Care?

Crypto airdrops are not losing popularity despite the scams. It is still a legit marketing tactic and a way for young crypto startups to increase awareness and build a follower base. But as airdrops are widely exploited by scammers, it is equally important to know how to recognize airdrop scams and how to keep your funds safe.

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    This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed to be financial legal or tax advice. Trading Forex, cryptocurrencies, and CFDs poses a considerable risk of loss

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    Author

    Simona is a fintech journalist and content editor at DailyCoin Academy, which focuses on educating new crypto investors. She entered the crypto space in early 2018, got burned, but discovered a passion for trading, and now it’s her hobby. Simona covers crypto and blockchain-related topics and takes a deeper look at what lies behind the latest industry trends.