Airdrops — What exactly is an Airdrop?

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Airdrops is a way to get free cryptocurrencies. Where is the catch ? The good thing is — there is really no catch.

The company that distributes the coins also has some of it. Nevertheless, there are a few things to consider in order to get to Airdrops Coins. What this is about, you will find out here:

What does Airdrops mean and how do they work?

  • Most likely they can be compared with a kind of giveaway. The developers of the cryptocurrency deliberately bring their own coin among the people. The developers do that for good reasons. Often these are young brands and startups who want to make their cryptocurrency better known. Just the announcement to get through Airdrops Coins provides a lot of attention.
  • And then, when people get the cryptocurrency, they often wonder what they can do with it. So begins the research, the interest in the cryptocurrency grows. Cryptocurrency developers could also try to make the coin distribution more decentralized.
  • However, cryptocurrencies do not just fall from the sky. Airdrops are also being distributed by platform operators, such as Binance , to reward their own members. In most cases, they must have a certain trading volume or be members for a certain period of time. Some developers want to distribute the cryptocurrency after a hard fork, because there is no other way. Or bypass the ban on an ICO .

How do you get free Airdrops?

First of all, you need a wallet. This wallet should be able to accommodate several different cryptocurrencies. Wallets that can hold ERC20 tokens are particularly suitable for this, because behind many Airdrops Cryptos are ERC20 tokens based on the Ethereum Blockchain. It is advantageous if there are already a few Ether Coins in the wallet and a certain activity can be detected on it. Some teams will check to see if the wallet really belongs to a human being, and not just masses of wallets, to get as many Airdrops coins as possible in vain.

For other cryptocurrencies, it depends entirely on the developers or the company. Often these provide specific conditions or require you to register on their site. It may be that you have to short-circuit for some Airdrops on Telegram with the developers. Or you have to write to a forum with a private message. Twitter is also a useful way to get coins for free. Just follow the social media channel of a cryptocurrency and wait for their instructions.

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Where is the difference between a manual and automatic Airdrop?

With a manual Airdrop you have to take care of yourself to get the Airdrops cryptocurrency. You need to follow the developers on social media, maybe share or like a tweet, fill in some forms or surveys. Sometimes just ask one of the team members directly in a forum.

With an automatic Airdrop you do not have to do any more than have an active wallet. From one day to the next there are a few unknown coins on the wallet. Mostly the address needs a credit, so that the wallet is activated by the deposit. An automatic Airdrop Crypto is often an ERC20 token based on the Ethereum Blockchain. For this you need an Ethereum Wallet.

Airdrops — Why they could be worthwhile & what you should consider!

Airdrops give you the chance to get a cryptocurrency you probably would not have heard of otherwise. In the worst case, you get a free coin, which will not be worth much later and only on the wallet virtual dust sets, because you can not sell them. But it did not hurt you either. In the best case, the price actually rises after a while and you can make a profit without having invested anything.

But be careful: even Airdrops can be abused for fraud. That’s why you should never give the Wallet’s private key. Nobody needs the private key to send coins to a wallet, just the address. Also you should never send money for Airdrops. It’s about getting something. That is why it is always important to review the official channels of the development team or to interact with others in the crypto scene.

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Airdrop’s Taxes — You need to know -

So far, there is no official rule as far as Airdrop’s taxes are concerned. If in doubt, you should simply contact your tax adviser or the tax office. Automatic Airdrops are similar to a lottery win. At the same time, the coins are only created in the Wallet, which is why there is no taxable gift. Also, no acquisition process takes place. The situation is different with the manual Airdrops . For this the participant must do something, so a tax will be incurred.

What tools are needed to keep your Airdrops?

Cointracking is a very helpful tool. First and foremost it is a crypto-currency trade analysis tool, it also shows the latest news related to ICOs and Co. There are several websites that tell you about upcoming Airdrops , such as Icodrops, Airdrop Alarm and Cointrend.

Conclusion

These coins are a great opportunity to get into unknown cryptocurrencies without having to invest money yourself. And they are an effective marketing measure by the developers. If you keep your eyes open, you’ll always find a current Airdrops somewhere.

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