What is crypto airdrop?

1 The crypto airdrop is a marketing method employed by startups in the cryptocurrency space. 2 It involves delivering bitcoins or tokens to the wallets of current cryptocurrency traders, either for free or in exchange for a small promotional service. 3 The airdrop is meant to spread awareness and increase ownership of the currency startup.

What is a holder airdrop?

Some holder airdrops may only award an airdrop if members are holding a certain amount of tokens; otherwise, they may pro-rate the award amount. A more specific type of holder airdrop, an exclusive crypto airdrop occurs when specific people are individually selected for the airdrop.

Do you have to pay tax on crypto airdrops?

Finally, since airdrops are considered income by the U.S. Internal Revenue Service, it means whenever you received an amount of “free tokens” you’ll actually need to pay tax on them – whether you wanted the airdrop in the first place or not. The cryptocurrency industry has recently seen a few crypto airdrops that took users by surprise.

What are the requirements for receiving crypto airdrops?

The main requirement for receiving crypto airdrops is having a cryptocurrency wallet with a balance. One can't receive or claim an airdrop without having a wallet address. Using an exchange address is convenient but not suitable for airdrops.