As a trader or an investor in cryptocurrency, you may be familiar with the word "Airdrop" already. But if you are a beginner, maybe you are unsure or do not know what it is. In this article, we will give you the details you should know about airdrop!
What is Airdrop?
Airdrop is a distribution of tokens to users for free. Normally, an airdrop is used as a marketing strategy to introduce or promote new tokens. Developer teams will give away free tokens to users’ wallets to gain more early adopters or potential users.
- When a new or a start-up company launches their new product, they offer a lot of freebies such as discount codes and promotions to bring in more customers. Shopping apps like Lazada and Shopee also used this strategy in their early stage after opening the company by paying their money to attract more customers. This is the price companies are willing to pay which is called “Customer Acquisition Cost (CAC)”.
- Similarly in the crypto or Defi world, no matter how great the product is, it can be nothing without users. Thus, it is very important to introduce the product to the blockchain community and gain new users.
Types of Airdrop
We can categorize airdrops into 5 types, based on the criteria for receiving the airdrop.
1. Standard Airdrop
This is a typical type of airdrop. Users can just receive free tokens by registering with their email address/ wallet address or signing up for a newsletter.
2. Bounty Airdrop
This type of airdrop requires users to perform simple tasks. These tasks include but are not limited to re-tweeting posts about the project or following the project’s official channels such as Facebook, Instagram, or Telegram.
3. Exclusive Airdrop
This one is an exclusive airdrop to a group of users who have been contributing to the project. For example, in September 2020, Uniswaps distributed 2,500 UNI to its loyal users. Bitkub also airdropped 10,000,000 KUB to users before the public sale.
4. Hard Fork Airdrop
This one is quite different. At the point when a token hard-forks from its original blockchain, another token is created, and the users who held the first token will get an equivalent amount of the new tokens in their wallets. The best example of this would be the Bitcoin Cash (BCH)'s hard fork that happened in 2017. Bitcoin holders got an equivalent amount of BCH consequently.
5. Holder Airdrop
This airdrop is similar to Hard Fork Airdrop in that the token holders will receive certain amounts of new tokens. For instance, IOST holders received Donnie Finance (DON) tokens. This token is one of the projects established on the IOST blockchain.
What type of airdrop is most related to Bitkub?
The answer to this question would be Holder Airdrop. There are many tokens with good potential listed on Bitkub and they may come up with airdrop events to promote new tokens from their developer teams in the future. Bitkub will then consider supporting each airdrop for the benefit of our customers.
Why do we need to perform temporary system maintenance to support an airdrop?
In order to support an airdrop, we need to take a snapshot (to capture the number of tokens our customers hold at some point before the airdrop). Snapshot is a necessary part because the developer team needs to know the total amounts of tokens that users from different exchanges hold in order to proceed with the token distribution.
Bitkub’s process to support airdrop is as follows.
- Bitkub makes an official announcement about airdrop support to our customers.
- Bitkub announces that the deposit and withdrawal of the related token will be temporarily suspended, which is normally 2-3 hours ahead of the snapshot time.
- Bitkub proceeds with the snapshot to gather the total amount of tokens our customers hold at the time. We then send this snapshotted data to the token's developer team.
- The developer team receives our data and distributes the air-dropped tokens to Bitkub.
- Once Bitkub receives the air-dropped tokens from the developer team, we will continue to calculate and distribute them to our customers according to the airdrop criteria.
Q: I saw on K.Topp's page about giving out free KUB coins, but I have to transfer some of my funds to him first.
A: That is a fake airdrop from a counterfeit Facebook page/website. Please be reminded that most (if not all) of the developer teams do not ask users to send money to them in order to receive the airdrop. Also, avoid clicking on any links shown on the post and make sure if the post is official by rechecking with the post on our website, Bitkub.com, or Bitkub's official Facebook @bitkubofficial. You can also contact our Bitkub Support to recheck, 24/7.
Q: Why do we need temporary system maintenance before our snapshot?
A: We need to temporarily suspend the token's deposit-withdrawal before the snapshot in order to prevent the event that processing transactions are not included in the snapshot.
Q: When will Bitkub list the tokens airdropped?
A: We do not guarantee the token listing by supporting the airdrop as per our internal policy. Please allow us to keep you updated on this matter via our website.
Some airdrops we have supported:
- Spark (FLR) is a native token of Flare Network. The network is one of the projects from Ripple, XRP founder. FLP tokens are to be airdropped to those who held XRP.
- Donnie Finance (DON) is a native token of Donnie Finance platform (Defi), developed by Korean developers on the IOST blockchain. DON was airdropped to those who held IOST.
- BOBA is another Defi token partnered with OMG Foundation which Bitkub supported their airdrop of BOBA in September 2021.