Announced on the 6th of November, the Stellar Foundation is planning the biggest airdrop in cryptocurrency history thus far. USD 125 Million in Stellar Lumens tokens (XLM) are to be given away to those who have a Blockchain wallet. Blockchain (formerly Blockchain Info) are the creators of the most popular online crypto web wallet, which is facilitating the airdrop. The Stellar Foundation is a non-profit aiming to bank the unbanked and make finance accessible to all. It was started by Ripple and Mount Gox creator Jed McCaleb.
The Stellar Foundation airdrop
In the first batch of the airdrop, USD 25 Million of XLM tokens are to be given away. Priority is given to those with the oldest accounts on blockchain and participants must be willing to verify their identity. Participants must also reside in an appropriate legal jurisdiction for the airdrop. Airdrops can be an effective means of promoting a particular cryptocurrency. Speaking on the Stellar airdrop, Jed McCaleb stated that –
“We believe that airdrops are central to creating a more inclusive digital economy. Giving away lumens for free is an invitation to communities to design the services they need. By working with Blockchain to increase the availability and active use of lumens on the network, we will increase the network’s utility by many orders of magnitude.”
Do airdrops work?
Giving away cryptocurrency for free is a highly effective form of marketing. However, there is evidence to suggest that the airdrop may have had its day. Too many coins are now doing it, and it is losing its effectiveness, as wallet owners have small amounts of multiple cryptocurrencies. However, it is useful for marketing purposes and general awareness, as people will see the coin and might do further research. Many popular coins such as OmiseGo have used airdrops for promotion.
Other firms are taking a more targeted approach by giving away cryptocurrency to those who would be interested in what the coin has to offer. This adds a new dimension to the cryptocurrency marketing model. The targeted airdrop approach is known as the smartdrop, and they will likely replace the airdrop which is crude in comparison. Some have referred to airdrops as ‘dumbdrops’ in contrast to the new smartdrops. ETERBASE and Polymath are examples of blockchain companies that have used the smartdrop as opposed to the airdrop with significant results.
Digital Nomad with an interest in Zen and Blockchain technology.
Law graduate with 3 years experience as a consultant in the capital markets industry and 4 years experience freelancing on UpWork as a Creative Writer.