What is an airdrop? An analysis of the most popular zero-cost profit mechanism in the crypto world

The cryptocurrency market has experienced a bottoming rebound after adjustments in 2023. Besides direct trading of mainstream coins, a participation channel increasingly attracting investors’ attention has emerged—Airdrops. This mechanism, characterized by low barriers to entry and high returns, has quickly become a hot topic in the crypto community. Compared to traditional investment methods, airdrops offer an almost zero-cost yet potentially lucrative path to wealth. So what exactly do airdrops mean? How can ordinary users seize this opportunity?

What is the essence of an airdrop?

An airdrop (Airdrop) is a promotional mechanism where projects distribute tokens for free to users. This concept originated in the early days of cryptocurrency—simply promoting Bitcoin on social media could earn reward tokens. Today, this approach has evolved into complex and diverse forms, with project teams setting various filtering criteria to assess user value.

Specifically, airdrops are divided into two distribution methods:

Direct Transfer—the project team proactively transfers tokens into eligible users’ wallets

Claim-Based—users need to actively click the Claim button to receive the allocated tokens

The current mainstream filtering logic for airdrops in the market is: users demonstrate their value through staking, interaction, governance participation, etc., and thus earn token rewards from the project team. Simple task-based and in-depth participation coexist; the former only requires social media engagement, while the latter involves long-term holding, providing liquidity, writing smart contracts, and more.

Why are project teams so keen on airdrops?

On the surface, airdrops seem like a benefit-sharing act for project teams, but the underlying logic is quite clear: Distributing tokens for free has a far greater promotional effect than traditional marketing, quickly accumulating users and forming community consensus, laying a foundation for long-term ecosystem development.

The most convincing example is the airdrop of the Layer 2 public chain Arbitrum. The project airdropped 1.162 billion ARB tokens to the community, covering about 625,000 wallet addresses, with an average of 1859 tokens per address. This airdrop not only sparked community excitement but also led to sustained ecosystem growth—according to Dune data, after the airdrop incentives ended, Arbitrum’s daily active users and transaction volume hit new highs, fully demonstrating the long-term boosting effect of airdrops on project ecosystems.

How profitable are airdrops?

Before the market landscape changes fundamentally, airdrops are indeed the most cost-effective option for participating in crypto investments. Although returns vary depending on project size, overall, grabbing airdrops remains a low or zero investment activity that can yield substantial returns.

Based on the top ten crypto airdrops calculated at their all-time highs (as of December 2023), these are classic cases:

Uniswap Airdrop (September 2020)
Decentralized exchange Uniswap distributed 400 UNI tokens to each user for free, with the token price fluctuating between $3-4 on the day, worth about $1200 directly. At its peak, this asset soared over $10,000, becoming one of the most valuable airdrops in history.

Bored Ape derivative token APE airdrop (March 2022)
Leveraging the influence of the BAYC community, Yuga Labs launched the independent token APE. On the airdrop day, users received an average of 1500 APE tokens per account, which, at the then $6-7 price, translated into a direct cash benefit of $9000-10500.

Arbitrum token ARB airdrop
Nearly 2000 ARB tokens per account, valued at an average of $1.3-1.4, resulted in a direct sale yield of about $3000.

Of course, not all airdrops create miracles; many projects yield more modest returns. However, earning tens to hundreds of dollars per account has become the norm in the market, especially when backed by larger funding rounds and strong project teams.

What promising airdrop projects are there in 2024?

In the first half of the year, emerging projects like Starknet, Etherfi, Dog帽币, Notcoin have brought substantial returns to early participants. After screening, the following categories of projects are receiving particular attention:

Cross-chain protocol layer—LayerZero raised $120 million in Series B funding, with a valuation of $3 billion

Layer 1 public chains—Emerging mainnet projects like Monad

Layer 2 scaling solutions—zkSync, StarkWare, Linea, Scroll, among others

Testnet projects—Base, SEI, Sui, Zircuit, which are fully accessible at zero cost and are highly funded

Emerging tracks—New projects are constantly launching; staying updated on market dynamics is key to discovering opportunities

How to participate in airdrops scientifically?

With thousands of crypto projects, blindly grabbing airdrops is inefficient. A systematic evaluation methodology is necessary for effective participation.

Step 1: Assess project funding strength
This directly determines the likelihood of an airdrop. Generally, projects with total funding exceeding hundreds of millions of dollars are almost certain to distribute tokens, greatly increasing airdrop chances. Conversely, projects with less than tens of millions and lacking backing from top investors have lower probabilities.

Use investment and funding data websites, Twitter, and other media channels to learn about project backgrounds. Following professional airdrop bloggers can provide timely information and participation strategies.

Step 2: Develop personalized interaction strategies
Choose different approaches based on the project stage:

• Testnet projects: Actively interact using free test tokens
• Mainnet projects: Select methods according to specific features

Mainstream interaction types include:

Key tip: Interaction frequency and time span have become core evaluation criteria for project teams, used to filter airdrop hunters. If participating with multiple accounts, ensure proper isolation; otherwise, being identified as a Sybil attack (multi-account manipulation) will result in disqualification from the airdrop.

Common questions about airdrops for beginners

Q: Can I participate in airdrops with zero experience?
Absolutely. After grasping basic knowledge, start with zero-cost testnets or, if funds permit, go directly to mainnet. It’s recommended to become proficient with a single account before attempting multi-account operations.

Q: Are airdrops scams?
There are risks, so focus on projects with large funding and well-known teams. Beware of “airdrops” requiring large investments—true airdrops are zero-cost; any request for money is likely a scam.

Q: Should I sell the airdropped tokens immediately?
It depends on the project’s prospects. However, experience shows that selling immediately on the first day of the airdrop is the most prudent way to lock in gains and avoid price volatility risks later.

Q: How can I discover new airdrop opportunities in time?
Professional platforms like AirdropAlert, Airdrops.io, and CoinMarketCap’s Airdrop channel regularly update information. Also, closely monitor Twitter, Reddit, Telegram, and other communities, as project teams usually announce airdrops first through these channels.

Conclusion

At its core, an airdrop is a win-win agreement between project teams and users—users receive assets at zero cost, while projects accumulate ecosystem users. Although the difficulty of airdrops has increased over time, their potential returns remain strong. It’s foreseeable that many high-quality projects will still be worth participating in through airdrops in the future.

However, if you want more stable excess returns in crypto investing, continuous learning of trading fundamentals is essential. Airdrops are just the entry-level stepping stone; true wealth accumulation depends on building a deep understanding of the market.