Since the explosion of cryptocurrencies, we have seen many usages of airdrop from Initial Coin Offerings (ICOs) to create brand awareness. These days, smartdrops are gaining popularity for more targeted marketing. In this article, we will go through the differences between the two concepts.
In the early days of cryptocurrencies, airdrop has been one of the most successful and popular methods of distributing coins and raising capital for new startups or blockchain projects. Holders of a certain coin are usually given a free number of tokens or when they perform certain marketing related tasks. Quite simple, but projects gained awareness from rather untargeted participants too. Many users were observed to be merely accumulating such tokens for speculation instead which affects supply in the open market afterwards. Furthermore, some also have to wait till the coin gets listed on various exchanges in order to trade. There are exceptions where the project chooses the Initial Exchange Offering (IEO) route though.
On the other hand, smartdrops do have some advantages where blockchain projects may garner real interested users in the long-term because people have to fulfil specific actions before being awarded tokens. For instance, they will have to share information about the project, complete KYC verifications or invite others to be part of the community. The biggest advantage is access to people who are actually invested in the company’s growth. Instead of targeting thousands of people who are not interested, it may be better to have the few hundreds who actually care instead.
These users are more likely to value add to the project and help build the community organically. The people who are active and contributing will get the rewards and this will motivate others as well. It can also result in faster innovation cycles when the community gives feedback for improvements and new features. Morpheus Labs and Polymath are two projects who grew strong communities through the smartdrop method. Therefore, smartdrop is a fast-growing trend as projects find more effective ways to distribute their tokens.
Over the coming months, more innovative methods of token distribution may arise as with anything in the crypto world. Nevertheless, what do you think of smartdrop and airdrop? We welcome you to give your insights too.
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