Airdrop
An airdrop is the free distribution of tokens to existing users of a network or application, usually as a reward for early use or to spread the tokens.
Explained simply
New projects want to distribute their tokens broadly and retain users. So they credit early users with tokens, often by criteria such as "used the application before date X".
For recipients it is a gift with strings: the value can be high or drop to zero, and in Germany an airdrop can have tax consequences.
Fraudsters also use the term as bait: "airdrop" as a pretext to get users to grant access to their wallet.
From the familiar world
The free shares a company hands to loyal customers at its IPO. Nice, but how much they are worth in the end is decided by the market.
An example
A major layer-2 network distributed tokens worth several hundred million dollars to earlier users at launch, tiered by activity.
Why it matters
Airdrops explain why some users try many applications, and they are a gateway for fraud. Both are useful to know when clients mention them.
To pass on
„An airdrop is a token gift to early users. A genuine one never asks you to approve anything or deposit money.“
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