Free Lunch in Crypto — SIMETRI Insights
Since crypto is gaining traction, I’ve been approached by many of my no-coiner friends about how to get into the market right now. The answer to this question is actually quite important.
The market is currently quite elevated and from a risk-reward standpoint, it’s difficult to recommend people invest their hard-earned cash right now. Bitcoin is less than 2x from $100,000, but the road there will be bumpy in my opinion.
In other words, most of the growth for the large-cap projects has already happened. But small-cap projects still can bring outsized gains. Though, without the guidance of research teams like SIMETRI, picking the winners from the scams is hard.
So, how can one get into the market without risking too much? By chasing airdrops.
In the previous issue of Insights I touched on why the next wave in DeFi will likely be multichain. At this moment, dozens of new projects are launching outside of Ethereum and they are fighting for your attention. In cash.
The simplest way to get traction for these projects is to offer something in return. For them it doesn’t cost much: just mint some more tokens for the community and airdrop them.
Airdrops aren’t a new concept. It’s been out there for years, but only at some point in bull markets do they get sizable enough to justify the effort. Its time to seize the opportunity.
The size of an airdrop right now can get as high as $10,000. The latest airdrop from Internet Computer, a.k.a. Dfinity, dropped over $35,000 for those who did two simple actions three years ago.
Yesterday, one member of the YFI community, Banteg, said that whoever will reply to his tweet with a picture of a dog licking them will get an airdrop of the new WOOFY token. What sounded like a joke turned into a real deal and participants got $420 each.
Now, not every airdrop will result in a big payout. That’s why I wouldn’t recommend chasing them continuously. When I was trying to get airdrops in 2018 they all cost no more than $10 to participate, so it still wasn’t worth the effort.
Right now, however, that’s the best way to get into the market. Also, it’s a nice side hustle. While researching the market you can spend some time getting in on airdrops.
How to do that? Just keep on looking closely at social media. The current airdrops are usually designed to increase a project’s following. So, you will see people retweeting posts and tagging others to increase awareness.
Usually, there will be a short form asking you to share some of the project’s information on your social media and provide your blockchain address. Some airdrops will be like a lottery, some will offer a guaranteed allocation.
What’s more, you can game the system by creating several social media accounts and applying for the same airdrop. It’s not for every project and it takes time but the result may be worth it.
Finally, active participation in crypto also gets rewarded. Some projects like Uniswap and Compound provide retroactive airdrops for early users.
Others, like Frozen Yoghurt, offer airdrops as a nod to original projects. Frozen Yoghurt is a copy of Curve on Fantom blockchain and veCRV holders can now get regular airdrops of FROYO to their addresses.
All in all, crypto is getting frothy. If you spend some time chasing a free lunch, you may eventually get a pretty tasty one. Good luck!
Disclosure: The author of this newsletter holds Bitcoin, Ethereum, ICP and WOOFY. Read our trading policy to see how SIMETRI protects its members against insider trading.