Is airdrop marketing still profitable in 2025?
In a pool of crypto audiences, one mechanism that brings together different demographics of crypto users is airdrops. It is a concept centered around the distribution of rewards, and it has become increasingly popular within the crypto space.
Research shows that nearly 90% of crypto projects use airdrops to grow their audience. But what fuels this marketing trend, and is it still effective in 2025? This article will address these questions and explore whether airdrops remain a sustainable marketing strategy for crypto projects.
Over the years, airdrops have simply been a way of giving out incentives to a community to grow a particular project. The term first appeared during World War II and was used to describe the act of dropping supplies from aircraft to ground forces.
The Google Ngram chart shows that the use of the word peaked in 1995 due to its use in the Bosnian War to describe the act of supplying food to civilians trapped in war zones. Ever since, it has been used in different industries, including tech, finance, marketing, and more.
In traditional finance, many companies have used the concept of airdrops to distribute bonus shares and stock dividends to attract more investors and inject liquidity into the market. Between 1987 and 2003, Microsoft has split its stock nine times. Likewise, Walmart have offered investors stock splits 13 times. Other major companies, such as Coca-Cola, have also adopted this strategy.
Although the concept of airdrops originated for humanitarian purposes, it has made its way into modern finance. In decentralized finance (DeFi), for example, airdrops have been used as a distribution model for projects to reward users.
Similar to the distribution of weapons, food, or medicine in humanitarian airdrops, DeFi airdrop rewards come in the form of coins and serve primarily promotional rather than humanitarian purposes.
Crypto airdrops simply mean distributing tokens to users in return for liquidity, network growth, and marketing. Airdrops are usually designed based on the objectives of the project.
To qualify for the free tokens, users may need to hold a certain amount of the token or perform a few tasks to help boost the project’s awareness.
As the popular saying goes, “Scratch my back, and I’ll scratch yours.” It’s a mutually beneficial exchange, and achieving the right balance depends on the design and objectives of the airdrop.
Many crypto projects across multiple chains like ethereum solana, arbitrum, and much more have incorporated airdrops into their distribution model, however only about 1 in 10 succeeds. Research indicates that in 2024, only 11% of airdropped tokens yielded positive returns for investors after 90 days.
This suggests that while airdrops are widely used as a strategy for user acquisition and growth, their long-term effectiveness remains uncertain.
Just like most things evolve over time, airdrop designs are not rigid but have been refined through lessons learned from previous projects. Crypto airdrops have transitioned from simple, and generous distributions to more complex models designed to encourage active user participation in the project.
Fair distribution tokens like Uniswap relied on retroactive conditions, rewarding anyone who had recently interacted with the platform with 200–400 UNI tokens. This was one of the easiest airdrops to claim, as it required minimal effort to earn money.
Before Uniswap, most airdrops, such as XLM, OmiseGO, and 0x, were either too small, distributed to random wallets, or lacked utility. For example, XLM airdrops failed because many tokens were given to Bitcoin holders, not the community itself, this encouraged farming rather than fostering an engaged community.
Uniswap addressed these issues by making the airdrop rewards both significant and community-focused. The project used a retroactive design, rewarding community members based on their recorded past activity.
The UNI airdrop was wildly successful and reshaped the narrative around crypto airdrops. the price of the distirbuted token peaked $16,000 – potentially life-changing money for many. However, it wasn’t without flaws. Since users weren’t required to hold or stake UNI to claim the airdrop, many sold their tokens immediately, leading to significant sell pressure.
The UNI airdrop was like a turning point in the crypto space and the idea of free money changing lives eventually led to people making a career out of farming airdrops. With multiple projects launching airdrops, some could actually make a living off them. This, however, made it insanely difficult to separate opportunistic users from those genuinely interested in the project.
Hence, the game now revolves around balancing free money with an effective strategy to ensure both sides benefit. There is now a huge design away from simple past-activity retrospective airdrops to more future-activity behaviour-shifting designs. This design integrate complex criteria, usually based on multi-phase airdrops, to better understand user behavior and continuously refine the approach.
Blur, an NFT marketplace and aggregator, is a good example of a project pulling off this complex strategy. They used a three-way approach, and rather than relying solely on retroactive rewards, the team adopted a multi-round process, reassessing and refining each season through a feedback-driven mechanism. Other projects taking a similar approach include Arbitrum and Optimism, both of which have been successful but come with significant costs.
For example, Blur allocated over 51% of its total supply to the community—a massive sum that many projects simply can’t afford. But did it work? Absolutely. With the multi-season mechanism, the project improved on uniswap’s strategy, introducing gamified engagement and onchain activity, which played a role capturing a significant share of the NFT market.
This proved that airdrops, when executed correctly, can be more than just free money, they can serve as a powerful and sustainable growth tool.
The success of any airdrop marketing depends on how it is designed. Fair and generous distributions with minimal criteria are cost-effective, while complex airdrops come with strict requirements that require users to engage and actively participate in the network, but they can be extremely expensive.
Designing and executing a successful airdrop requires balancing cost with a well-thought-out strategy. When done right, airdrops drive active community management, targeted distribution, organic growth, and governance participation. However, when they fail, they lead to farming attacks, token dumping, and poor user retention, issues that plague most Web3 projects.
Honestly, I believe it’s time for crypto projects to move beyond blindly throwing coins at a community of farmers who will most likely dump their tokens. Over the years, it has taken deep market research to design a truly effective airdrop. And with the current state of fiat currencies, where many are desperate to hunt for projects just to cash in, getting caught in this loop is the last thing you want. These people don’t care about your project, only the short-term hype – before they move on to the next on
Do I believe airdrops are an effective way to grow a project? Absolutely. But would I recommend them for a small project just starting out? Definitely not.
The next blog will explore alternative, more cost-effective ways to grow a Web3 business beyond airdrops marketing.
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