A recent paper is launching SmartDrops as a new and more effective alternative to airdrops. While the latter (airdrops) is known to give coins away indiscriminately SmartDrops promises to give free coins away to the base of a project.
There have been only two main options for new crypto projects to choose from in regards to distributing their coins. The new projects can either choose to host an airdrop for the cryptocurrency users or launch an initial coin offering (ICO). This is the process of selling the digital coin to the investors publicly.
ICOs rise tremendously
It is evident that the number of ICOs being launched has risen tremendously in the recent times. Thus, it minimizes the ability of each project to successfully sell each of its allocated virtual coins. Some projects have even found it difficult to hit their targeted soft cap.
Instead of introducing an ICO, several projects have opted for the hosting of an airdrop. In a bid to entice the community to participate, a given project will distribute its digital coins for free. All a user will need to do is sign up for it within a given period of time.
Consequently, it is expected that a user who benefits from the free coins should automatically go ahead and utilize it. However, this is proving difficult for new projects since some users are preferring to hold the coins as opposed to utilizing them. Hence, a project experiences a false shortage in the market hindering its growth.
Another challenge with airdrops has been its random distribution method. Many people get to receive the free coins, although a majority of them end up receiving very few digital coins.
Following these challenges, Rahul Raina together with Esteban Castano has since come up with SmartDrops. This new system promises to enable blockchain based projects efficiently dispense their virtual coins to a larger audience.
Castano confirmed that coins issuers are benefiting from SmartDrops since it is simple to use, time efficient and saves them money. Additionally, the new system is efficient at growing their initial community.
Castano revealed that SmartDrops was just the beginning. They are developing tools that will ensure the growth of token issuers. Moreover, the tools will help projects keep and better understand their users.