Airdrop

Crypto & Blockchain

An airdrop is a distribution of free cryptocurrency tokens to users meeting specific criteria — often early protocol users, NFT holders, or community members. Major airdrops: Uniswap (UNI tokens worth ~$1,200 to early users in 2020), Optimism (OP), Arbitrum (ARB), Jupiter (JUP). Used to bootstrap distribution, reward loyalty, decentralize governance. Many recent airdrops use complex eligibility criteria to filter out 'airdrop farmers' (users gaming the system). Tax implications: airdrops are taxable as ordinary income at fair market value when received. Some airdrops have made early users hundreds of thousands of dollars; most are negligible.