There are more ways to earn money in the crypto space than ever before. From trading and staking to flipping non-fungible tokens (NFTs) and yield farming, blockchain technology is responsible for a significant amount of value generation. Also, the play-to-earn (P2E) gaming revolution has inspired millions of gamers to put their skills to the test by competing in tournaments and battles. In turn, this trend has inspired other blockchain gaming genres like move-to-earn (M2E) and learn-to-earn (L2E), for example. However, those looking to make a few satoshis without spending too much effort may be more attracted to the idea of crypto faucets. So, if you’re one of the people wondering, “what is a crypto faucet?”, read on!
In this article, we’re going to dive deep into the world of crypto faucets. Also, we’ll look at the key differences between crypto faucets and airdrops. Additionally, we’ll discuss testnets, testnet tokens, and testnet faucets. Plus, we’ll explore some of the other ways you can earn crypto rewards. Make sure to check out Moralis’ crypto faucets!
Moralis Academy is the premier Web3 and blockchain education suite online. If you’re new to crypto, check out our Crypto for Beginners course. Here, we teach students about the foundations of Web3 and the key differences between Bitcoin, Ethereum, and altcoins. Plus, we show you how to buy, sell, and trade crypto using an exchange account. Join our community of over 30,000 students and kickstart your blockchain education journey today with Moralis Academy! Additionally, save our “Rust & Solana” and “Solana vs NEAR” articles for later reading!
What is a Crypto Faucet?
So, what is a crypto faucet? A crypto faucet is an application or website that enables users to earn crypto rewards by participating in tasks. The term “faucet” refers to a tap dripping small amounts of water that could fill a cup over time. One of the first crypto faucets was established in 2010 by Bitcoin developer Gavin Andresen. Users could earn up to 5 BTC at a time by simply completing a captcha. This faucet distributed a total of 19,715 BTC and was pivotal in the early distribution of Bitcoin.
Although nobody could truly understand the upside potential of Bitcoin at this time, crypto faucets are considerably less generous these days. However, crypto faucets still play a crucial role in increasing awareness of new cryptocurrency projects and encouraging new users. Also, faucets can be a great educational tool to assist new users in navigating the crypto landscape when they require participants to learn about the technology powering a project.
Most crypto faucets are easy-to-use and require you to create an account and register with that website in order to receive tokens. In many cases, a MetaMask wallet account may be required for you to receive any free tokens. Additionally, you may be asked to confirm your identity before you can earn crypto rewards.
Some of the tasks involved include reading content, watching videos and adverts, completing surveys and quizzes, or playing computer games. Also, some crypto faucets encourage users to onboard their friends using referral codes. Furthermore, some crypto faucets allow users to compound their earnings by completing tasks multiple times.
Crypto faucets exist on various leading blockchain and layer-2 networks. This includes Bitcoin, Ethereum, Litecoin, Avalanche, Bitcoin Cash, Monereo, and many more. Below, we take a look at some of the risks to consider when selecting a crypto faucet.
Crypto Faucet Risks
Despite the many benefits of crypto faucets, there are several drawbacks to consider before using them. Firstly, the crypto space is rife with scams and fraudsters. It’s important to always conduct your own research before registering with a crypto faucet, as you could be giving your information to a scammer or other malicious actor looking to infect your computer or compromise your privacy.
Another consideration is the amount of time it takes to complete tasks. Some tasks can be time-consuming. If this is the case, you may want to check to see if the rewards you receive for completing them will reimburse you sufficiently for your time. Also, crypto faucets tend to distribute small amounts of crypto assets at a time. As such, the gas fees for redeeming your crypto rewards could exceed the value of them at peak times. To remedy this, you can avoid periods of network congestion, or compound your rewards until the gas price is covered.
What is a Crypto Airdrop?
Now that we have addressed the question of “what is a crypto faucet?”, let’s take a look at airdrops. In crypto, an airdrop is a marketing strategy whereby cryptocurrency projects give away free tokens to promote their brand and gain awareness of their token. Often, airdrop participants must be active on social media and internet forums to stand a chance of entering. For example, participants may need to share posts, join discussions, or even create content for a new project.
As you might imagine, the term “airdrop” refers to crypto assets being dropped into traders’ cryptocurrency wallets. Just like crypto faucets, airdrops can also be dangerous if you’re not careful. There are plenty of scams out there. This includes fake airdrops that require some type of capital investment. Also, a type of scam known as a “dusting scam” is commonplace among airdrops. A dusting scam is when a malicious actor deposits an extremely small amount of crypto into a large number of wallet addresses to deanonymize them.
Faucet vs Airdrop
If you’re familiar with crypto faucets, you’ve likely heard of airdrops too. While faucets require users to complete tasks to earn small rewards in a way that is repeatable, airdrops tend to follow a distribution schedule. Airdrops work very much like faucets. However, they usually require participants to register with several platforms or follow multiple social media accounts and jump through various hoops to earn rewards.
Some airdrops will grant participants with more rewards for promoting the airdrop to friends or completing more challenges. Despite this, though, the challenges you need to complete for airdrops are usually directly related to spreading awareness. On the other hand, the challenges associated with crypto faucets are generally more straightforward. That said, airdrops often distribute more crypto rewards than faucets because they only occur once.
Despite the various differences, airdrops and crypto faucets are both very popular ways of earning free crypto by completing tasks. Also, both distribution models are common marketing techniques for new crypto projects, as they incentivize new users.
What is a Testnet Faucet?
A testnet is a version of a blockchain network that allows developers to iron out any kinks or bugs before launching the final version of the blockchain, the mainnet. Testnets are essential for blockchain developers as they facilitate the type of experimentation required to find obscure flaws without compromising the real blockchain or any user funds.
To achieve this, blockchain developers can get testnet tokens from a testnet faucet. Testnet tokens are like play money. However, they integrate with crypto wallets just like regular cryptocurrencies. Unlike regular crypto faucets, you don’t need to complete quizzes or watch videos to access testnet tokens from a faucet.
Without testnet tokens, blockchain developers would have to use real cryptocurrencies during testing. If this were the case, it would likely destabilize the value of the asset in question. As such, testnet tokens mimic the cryptocurrencies that underpin our favorite blockchain networks so that developers can safely make changes to a blockchain without it affecting crypto holders.
If you’re a developer and want to learn how to build, test, and deploy your own smart contracts on Ethereum, check out the Ethereum Dapp Programming course at Moralis Academy. This course teaches students how to build a non-fungible token (NFT) marketplace using Web3.js, Truffle, and Ganache. Plus, it’s the perfect way to start building up your Web3 development portfolio. Take your programming game to the next level today with Moralis Academy!
Other Ways to Earn Cryptocurrencies
So, if you’ve been watching adverts and completing captchas all day, you might be wondering if there are more efficient ways to earn crypto rewards. If this is the case, you’re not wrong! For starters, you could create your own cryptocurrency or non-fungible token (NFT) collection and sell them. However, if you fancy a bit more of a challenge, then you might consider a play-to-earn (P2E) gaming platform.
P2E games allow players to earn crypto rewards by flexing their skills in tournaments and battles. If you want to take more of an active approach to earning crypto rewards, then perhaps a move-to-earn (M2E) gaming platform would be more suitable. M2E games work very much like P2E games. However, instead of playing games on a computer, participants complete physical challenges. This includes sporting challenges, wellness goals, and daily practice.
Another way to earn a passive income with crypto is by creating a game or experience in the metaverse. Some metaverse gaming platforms allow users to monetize virtual land and resources by creating unique and engaging experiences that can be enjoyed time after time. Additionally, you may consider renting out your hard drive space as part of a decentralized data storage service.
Also, you could become a node on any number of cryptocurrency networks. In particular, crypto networks that use internet of things (IoT) devices to upload real-time data to traffic and logistics management systems allow users to earn money by contributing to a Web3 data economy. Moreover, you could earn crypto rewards by using a privacy-preserving Web3 browser like Brave.
Are Crypto Faucets Profitable?
Making a decent profit with crypto faucets can be extremely time-consuming. When you consider the amount of time it takes to earn more than just a few dollars, crypto faucets don’t come near minimum hourly wage requirements in most countries. However, it’s worth noting that compounding crypto rewards could be worth considerably more in years to come. Also, the nature of the tasks involved with crypto faucets is such that you can easily watch a few adverts, complete a few puzzles, or play a game on a coffee break from your job, on the bus, or whenever you have five minutes spare.
That said, if you actively seek out high-utility projects that distribute rewards frequently for minimal effort, you could make significant gains in the next bull market if you back the right project. On the other hand, it’s not advisable to quit your day job to speculate on crypto faucets by completing tasks all day. Moreover, if you can find a crypto faucet that doesn’t feel like work, you could make a passive income by doing something you enjoy!
What is a Crypto Faucet? – Summary
As the old saying goes, “there’s no such thing as a free lunch”. Even in the world of crypto, when things are free, they usually require some time and effort. However, crypto faucets are quickly becoming one of the most popular ways to earn crypto rewards. Despite the many reputable websites offering these rewards, there are several websites out there that are less than legitimate. As such, you should always conduct thorough research before participating in any sort of crypto giveaway. Once you have found one or more authentic crypto faucets, compare them to see which pays the highest rewards for the least amount of time completing challenges!
There has never been a better time to learn a new skill in an emerging tech field. Also, blockchain developers are in extremely high demand and can earn an incredibly handsome salary. If you want to become a blockchain developer but have no coding experience, check out the JavaScript Programming for Blockchain Developers course at Moralis Academy. Here, we teach students how to build a decentralized exchange (DEX) from scratch on Ethereum! Take your first steps towards a life-changing career in Web3 with Moralis Academy!
Additionally, don’t forget to follow us on Twitter @MoralisAcademy! We’d love to hear your thoughts about crypto faucets and airdrops! Also, check out our “Understanding Crypto Crashes” and “How to Invest During a Crypto Bear Market” articles to learn how to safeguard your portfolio during market downturns!
