Why projects give tokens away
An airdrop is a marketing and governance tool at the same time. It rewards the people who used a protocol before it was obvious, spreads the token across many holders, and creates a community with an incentive to keep using the product.
- Retroactive — rewards past on-chain activity
- Holder snapshot — based on holding another asset at a set block
- Task-based — for completing specific protocol actions
- Fork drop — new chain tokens issued to existing holders
How eligibility is usually decided
Most retroactive drops use a snapshot: a specific block height at which balances and activity are recorded. Criteria are announced afterwards precisely so they cannot be farmed cheaply — though people try anyway, which is why many drops now filter out obvious sybil wallets.
A protocol snapshots all wallets that made at least three swaps before a given block, then allocates tokens on a sliding scale by volume. Wallets created the week before the announcement are excluded.
The scam patterns
A legitimate airdrop never needs your seed phrase and never asks you to send funds first. Most airdrop scams work by getting you to sign a transaction that grants a token approval, which then drains the wallet.
- Never enter a seed phrase to "claim" anything
- Never send crypto to receive crypto
- Unsolicited tokens appearing in your wallet are usually bait — do not interact
- Check the claim URL from the project's official channels, not a search ad
- Review and revoke token approvals periodically
Tax and practical notes
In many jurisdictions an airdrop is taxable income at the value received, with a separate capital gain or loss when sold. Keep the date, quantity and value at receipt — reconstructing it later is painful.