Finding a way to earn free cryptocurrency is understandably something that many cryptocurrency investors are interested in. While there are ways of getting cryptocurrency for free, you shouldn’t expect major returns without taking on any risks.
In this article, we’ll show you how to earn free crypto in different ways. We’ll cover cryptocurrency faucets and airdrops, which are the main methods of getting crypto for free. We’ll also highlight some related ways of earning cryptocurrency by staking your crypto or depositing it in various crypto passive income products.
Get free crypto using crypto faucets
Faucets are a somewhat old-school way of getting free crypto instantly. Cryptocurrency faucets were first created by Bitcoiners who wanted to grow the Bitcoin community by giving away small amounts of BTC for free.
A cryptocurrency faucet is a website where you can input your crypto address and receive a small amount of crypto. Usually, you will have to solve a CAPTCHA or a similar test first to prevent spamming.
A crypto faucet is the most “no strings attached” way to earn crypto for free. However, you have to keep in mind that faucets typically only distribute tiny amounts of cryptocurrency, so don’t expect to make any meaningful profits. Faucets are mostly just a way to try out the technology and make a few test transactions to see how the cryptocurrency works.
Also, it’s important to understand that there are no faucets for some cryptocurrencies. However, if you’re interested in getting some testnet coins, you will usually be able to find a faucet for any cryptocurrency. On CoinCodex, we provide guides for using a BNB faucet, a Solana faucet and a Dogecoin faucet.
Get free crypto through airdrops
Airdrops are a popular way for cryptocurrency projects to promote themselves and distribute coins to a broader community of users. A cryptocurrency airdrop is when you receive some cryptocurrency in your wallet for no additional cost.
If you want to learn how you can find cryptocurrency airdrops, check out our list of the 5 best sites for free crypto airdrops.
In some cases, a cryptocurrency project will announce an airdrop ahead of time and allow interested participants to submit the wallet address they would like to use to receive the airdrop. Sometimes, such airdrops can come with some strings attached. For example, users might be required to promote the project on their social media accounts before they become eligible for the airdrop.
In other cases, projects will choose a set of criteria to determine which users will receive an airdrop. The most common example of this are “retroactive” airdrops, where users of a decentralized application or blockchain platform are rewarded with tokens.
A popular example of a retroactive airdrop is Uniswap. When the Uniswap decentralized exchange launched, the UNI token did not exist. When the Uniswap project decided to launch the UNI token in 2020, they airdropped UNI tokens to everyone who used the Uniswap decentralized exchange in the past. Examples of other notable projects that have conducted retroactive airdrops are dYdX, 1inch and Optimism. More recently, the Arbitrum airdrop was announced for past users of the Arbitrum layer 2 scaling solution for Ethereum.
You can use this knowledge to make yourself eligible for potential future airdrops. If you find a cryptocurrency project such as a decentralized exchange, lending protocol or layer 2 solution that doesn’t have its own token, it might be worth it to use the product so that you build up a history of on-chain activity related to the product. If the project decides to launch a token later on, you could become eligible for an airdrop based on your past use of the protocol.
Alternative methods of getting “free” crypto
If you want to get cryptocurrency completely for free while taking on minimal risks, the only realistic options are faucets or airdrops.
Theoretically, it is of course also possible to receive cryptocurrency as a gift, but we recommend extreme caution if an unknown person you meet online is offering to send you cryptocurrency for free.
In almost all cases, this involves some kind of scam—they will either ask you to send them some cryptocurrency first, or will attempt to steal your cryptocurrency in some other way. If you’re approached by someone that is offering you cryptocurrency, we recommend that you don’t accept their offer and ignore them. Remember, if something seems too good to be true, it probably is.
If you want to grow your cryptocurrency holdings without spending money, you will practically always have to take on some amount of risk. There’s two main ways you can do it—cryptocurrency staking and passive income products.
Earn rewards through cryptocurrency staking
There are two main approaches to securing a cryptocurrency network — Proof-of-Work and Proof-of-Stake.
In Proof-of-Work cryptocurrencies, “miners” deploy computers that solve computationally intensive problems, and the first one to arrive at the correct solution has the right to add the latest block to the blockchain and receive a reward.
In Proof-of-Stake cryptocurrencies, “validators” put their cryptocurrency at stake. If they are selected to add the next validator to the blockchain, they must do so in accordance with the rules of that particular cryptocurrency’s protocol. If they do so successfully, they receive some cryptocurrency in return. If they are found to be breaking the rules, they are penalized by having a portion or the entirety of their stake taken away.
Earlier cryptocurrencies were almost exclusively using Proof-of-Work, but we’re now seeing a significant growth in Proof-of-Stake cryptocurrencies. Examples of Proof-of-Stake cryptocurrencies include Ethereum, Cardano, Solana, Polkadot and Avalanche.
In many Proof-of-Stake cryptocurrencies, you can choose to run your own validator or delegate your coins to another validator to receive a portion of the rewards earned by that validator.
If you hold a Proof-of-Stake cryptocurrency and don’t intend to sell it in the short term, you should seriously consider staking your coins. There’s two main benefits of staking. The first benefit of staking is that you will receive crypto rewards in exchange for staking your coins. The second benefit is that by staking your coins, you contribute to the security and decentralization of your cryptocurrency of choice.
Some cryptocurrency exchanges offer cryptocurrency staking products where they stake customers’ crypto on their behalf. However, you can also stake most Proof-of-Stake cryptocurrencies directly from your crypto wallet.
Earn interest through passive income products
Some cryptocurrency businesses offer crypto passive income products where you can deposit your cryptocurrency and earn interest on the deposit. In most cases, the interest is earned by lending the cryptocurrency to third parties.
Crypto passive income products are typically offered by crypto exchanges, but there are also businesses that specialize in such products.
As far as exchanges are concerned, one of the most popular examples is Binance, which offers the Binance Earn suite of products for earning crypto yield. On Binance, you can choose between flexible and locked products. The interest rate offered will vary depending on multiple factors, including the cryptocurrency you’re depositing, the duration of the deposit, and more.
If you’re using flexible products, you can withdraw your deposit at any time and collect the interest you have earned so far. If you’re using locked products, you can only earn interest if you keep the deposit locked for a specified period of time.
It’s important to keep in mind that crypto passive income products are not risk-free. Many crypto lending businesses such as Celsius, BlockFi and Voyager, which offered such products, collapsed in 2022 due to poor risk management practices. Users who deposited funds with these businesses now have their funds stuck (or lost) and need to wait for the outcome of complicated bankruptcy proceedings.
So, before choosing to deposit your cryptocurrency into such products, it’s important to conduct your own research on the business you’re looking to use.
The bottom line — There’s multiple ways of getting free crypto
If you’re investing in crypto, there’s ways to get some extra coins for free or by taking minimal risks. The most common ways of getting free crypto are faucets or airdrops, but you shouldn’t expect to make big profits in this way. If you hold a Proof-of-Stake cryptocurrency, consider staking your coins to earn rewards passively while helping contribute to the cryptocurrency’s decentralization.
There’s also riskier ways of getting crypto for “free”. This would include various cryptocurrency lending products, which are offered by businesses such as exchanges. These products pay interest to users who deposit their cryptocurrency. Such products are riskier because you need to trust the business to handle your cryptocurrency responsibly and apply proper risk management properties.
