So, what is a crypto airdrop and ICO, and how do they work?
What Is a Crypto Airdrop and ICO?
They are also an avenue for people to invest in the new cryptocurrency.
An ICO is, however, slightly different from an airdrop.
How Does an Airdrop Differ From an ICO?
Why Conduct an Airdrop?
We’ll use the 2019 Stellar airdrop to illustrate the incentives to use a service.
Each wallet received 100 free XLM, which at the time was worth $25.
Why Conduct an ICO?
ICOs are mostly conducted by new projects or projects re-launching for one reason or the other.
But why does a project need to raise funds right at the start?
Ethereum, the second largest cryptocurrency after Bitcoin, started with an ICO.
Luckily, it did, but this isn’t always the case, and there are also outright scams.
This is why regulators frown at ICOs, and they are no longer very common.
Pros and Cons of Airdrops
Airdrops have evolved significantly over the last few years.
They used to be as simple as sending you free tokens for meeting certain conditions, but not anymore.
Participating in airdrops has become more competitive because the awareness of crypto is on the rise.
This comes with some pros and cons.
The following are some pros and cons of engaging in an ICO.
Pros of ICOs
Cons of ICOs
Should You Participate in Airdrops and ICOs?
However, check that the airdrop will reward you with as little work as possible.
For ICOs, “do your own research” is the watchword.
Carry out a thorough background check to ensure the project is legit before investing.
There is always a risk, though, and you should keep that in mind.
