How Do People Make Money on Retrodrops — In Simple Terms
Hey guys! We want to tell everyone who isn’t familiar with it yet about how earning on retrodrops actually works, what it’s based on, where the money comes from, and what you need to do to get into the next airdrop.
So, a retrodrop is when a crypto project (blockchain or Dapps) distributes its tokens to users for free. The tokens are given out for early activity in the project. In simple terms, if you tested or used the project before it launched its token, you might be among the lucky ones who receive the airdrop.
The amount of the airdrop depends on the level of your activity. If you were an early user and used the project a lot (for example, made 50+ transactions on that blockchain), you would be more valuable to the project, so they would give you more tokens. In other words, the earlier and more you contribute, the higher the chance of receiving a generous airdrop. But even with a few actions, you can meet the criteria for the airdrop.
Unfortunately, nobody can know certain details such as:
- Whether the project will distribute tokens for sure
- When they will distribute them
- What exactly they will distribute them for
- What the criteria for the airdrop multiplier will be
Therefore, to some extent, we can only speculate and draw conclusions based on past project experiences. We look at all the projects that have already conducted airdrops, study what they gave and how much, and then use that information to prepare as effectively as possible for future projects.
Why do projects distribute tokens through retrodrops?
Mostly, it’s due to SEC regulations. If a project gives away tokens for free, they don’t fall under the definition of “securities,” and the SEC can’t intervene with the project. So, it’s more advantageous for projects to distribute tokens to their community for free and then sell some of their tokens on the exchange to regular investors during the hype, thereby making a substantial profit without facing SEC inquiries. That’s how the scheme works.
Where can you find projects that might offer retrodrops in the future? It’s simple: analyze the market, explore various information sources, gather lists of projects, and start engaging with them by performing similar activities for which airdrops were given in past projects. Use the following criteria: blockchain project (preferably), the project doesn’t have its own token yet, and it has received a significant amount of investment.
How can you potentially increase the amount of the airdrop? Run the project through not just one wallet but a dozen or more.
As a simple example of an airdrop, once I exchanged BIFI from the Ethereum network to the Arbitrum network (about a year and a half ago), and for using that bridge, I received ARB tokens worth $4,000, which I wasn’t even aware of. So, I received tokens for being an early user of the blockchain. And if I had done that with 100 accounts back then, it would have been $400,000.
There are now many airdrop hunters, but many of them give up after a series of failures. Also, it’s always worth doing slightly more activity than the majority to get into the top active participants.
