Is 2022 the Year of Cosmos Airdrops?
A quick explanation of Cosmos airdrops and how to be eligible
Hey DEFI TIMES community,
2021 has been an amazing year for the crypto community as a whole.
We saw many new niches inside crypto emerging and maturing. NFTs, Play-to-Earn games, etc.
One of these niches is the Cosmos ecosystem, which was in its infancy only a year ago.
Some of them are established chains like Terra LUNA. Other chains are completely new chains that decided to integrate IBC from the start. There is one particular pattern that most of these newly created chains have in common: The fact that they distribute a part of the total supply to the Cosmos community - effectively an airdrop!
It’s reasonable to assume that this trend will continue going forward this year.
Today, we talk about how these airdrops work and how you can make sure to be eligible to claim most of them.
I expect more than 50 new airdrops this year alone, which could potentially yield life-changing gains in 2022.
How can you get them? Let’s find out!
📺 Watch our latest video about how to make a living of Cosmos airdrops!
How to Be Eligible for Cosmos Airdrops
It will be very hard to be eligible for every single Cosmos airdrop that is coming. However, I can give you a pattern that most projects use to reward Cosmos ecosystem members. While all projects have unique requirements, there seem to be a few that most have in common:
Staking ATOM: Most Cosmos airdrops are distributed to ATOM stakers and/or holders. This is probably the safest bet to be eligible for most airdrops. But why exactly ATOM? Well, ATOM is the base currency for the Cosmos network - just like ETH is the native currency of Ethereum. Cosmos projects want to reward those who secure the center of the Cosmos ecosystem: The Cosmos Hub. If you are an ATOM staker, you are valuable to Cosmos. In fact, it has become a trend for Cosmos projects to reward ATOM stakers with an airdrop when they launch. I don’t expect that to change anytime soon. The fact that ATOM stakers receive airdrops, has pushed the percentage of staked ATOM to an all-time high. Right now, more than 60% of all ATOM are staked:
Staking OSMO: Most Cosmos airdrops in the past have also rewarded OSMO stakers. OSMO is the native coin of the Osmosis blockchain, which is basically an interchain exchange. Osmosis was one of the first Cosmos airdrops and is a major reason why the Cosmos space has grown so much in the past couple of months. To maximize your chances to be eligible for the next Cosmos airdrop, it might be smart to consider withdrawing your OSMO from your centralized exchange to a non-custodial wallet and stake them.
LPing on Osmosis: Just as it’s important to stake your OSMO, it might be smart to use the Osmosis exchange in any way possible. For example, consider providing liquidity with your Cosmos assets on Osmosis. Many liquidity providers received airdrops in the past and it’s reasonable to expect that there will be many airdrops left doing the same.
The good news is that all of the above options give you a passive income while you wait for your airdrops. Even if you do not receive the airdrop in the end, you still have the chance to make a living simply by staking and LPing your assets. Good deal, isn’t it?
Stake with Non-Exchange Validators
One thing to note is that you should always stake your assets with validators that are not exchanges. For example, the top 5 validators on the Cosmos Hub are mostly exchange validators: Binance, Coinbase, and Kraken.
Most airdrops in the past have excluded exchange stakers from the airdrops. This is to prevent exchanges from receiving these airdrops (as they would never claim them anyway). So make sure to stake with validators you know your trust in order to maximize your chances of receiving future airdrops.
How Much Money Will I Make Per Airdrop?
While Ethereum-based airdrops have made you fortunes in the past (Uniswap, ENS, etc.), Cosmos-based airdrops are not as rewarding. In fact, Cosmos airdrops are much smaller than Ethereum airdrops. But why is that so?
Well, first of all, Cosmos airdrops have many more recipients than Ethereum airdrops. While Cosmos airdrops reward all Cosmonauts out there, Ethereum, based airdrops reward only a fraction of all Etheruem users. For example, the ENS airdrop was only allocated to ENS users. On the other hand, Cosmos airdrops are allocated to all (or most) Cosmos users. Because the number of Cosmos users is much higher than Etherum protocol users, the overall dollar amount is smaller.
However, there will be many more airdrops in the Cosmos ecosystem than in Ethereum. That is because most Cosmos projects start - as a fact - with an airdrop in the beginning. That means the number of airdrops will yield bigger gains in Cosmos than in Ethereum… even though the dollar value of Ethereum airdrops is higher!
2022 is going to be the year of Cosmos airdrops. However, to maximize the number of airdrops you will receive, there are some things to keep in mind.
Keep your assets on non-custodial wallets
Don’t delegate to exchange validators
ATOM/OSMO stakers are eligible for most airdrops
Don’t expect to make a fortune per airdrop
If you consider these steps, 2022 will be an awesome year for you going forward! =)
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DISCLAIMER: All information presented above is meant for informational purposes only and should not be treated as financial, legal, or tax advice. This article's content solely reflects the opinion of the writer, who is not a financial advisor.
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