What Is a Crypto Faucet?

There are many ways to earn free cryptocurrencies. A crypto faucet is one of the earliest means. Users are rewarded for completing tasks ranging from simple to complex ones.

There are many scam sites today promising to offer free money. Hence there is a need to do your research if you intend to earn through a crypto faucet. It is a good way for newbies to start their journey into crypto space. In this guide, we will take a look at how a crypto faucet works and most especially the drawbacks of using this method of earning.

What is a Crypto Faucet?

A crypto faucet is a site, an app, or software that pays small amounts of cryptocurrencies to users as a reward for completing tasks. These tasks range from playing games, watching videos, viewing ads, solving catches, and other small tasks. The rewards are sometimes very small compared to the time spent on these tasks. Just like droplets can fill a bowl with time, these rewards, if left untouched, can compound over time.

The first crypto faucet was the Bitcoin faucet launched in 2010 by Gavin Andresen, a senior developer of the Bitcoin network. It was launched when cryptocurrencies were not just worthless but unknown. Users were then rewarded with 5 BTC for completing simple tasks. This has been the highest-paying faucet in history. A total of 19,715 BTC was given out. If this amount is calculated using the current price of BTC, it will amount to millions of dollars.

The purpose of crypto faucets is to incentivize people to learn about cryptocurrencies and possibly invest in them. When the first crypto faucet launched, the idea of cryptocurrency was still new and hence it was a great means of creating awareness. Crypto Faucets are categorized based on the crypto received as a reward, hence we have Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC) faucets, etc.

How Does a Crypto Faucet Work?

To make use of a crypto faucet, a user will need to register on the faucet by providing his details and wallet address. The wallet address is used to receive payment when the micro wallet is filled up. By signing up with a faucet, your micro wallet is automatically activated. Micro wallets are capable of holding small amounts of crypto assets.

The user will then need to complete some tasks. The task can be simple and sometimes complex and time-consuming. Some of these tasks include answering quizzes and surveys, viewing ads, solving captchas, and sometimes referring a friend to join. Users are in return rewarded with a small amount of crypto for completing these tasks. The reward can then be withdrawn to the user’s wallet. Depending on the faucet, the payment can be initiated automatically once the minimum threshold is reached.

Types of Crypto Faucets

There are several types of crypto faucets, which are categorized based on the token type that is paid as a reward or the type of task that a user must perform. Below we list some of them.

• Bitcoin faucets: These faucets dispense small amounts of bitcoin in exchange for completing tasks or solving captchas.

• Altcoin faucets: They work the same way as the former, but instead of bitcoin, they dispense various altcoins.

• PTC (paid-to-click) faucets: These faucets pay users small amounts of cryptocurrency in exchange for visiting websites or viewing ads.

• Offerwall faucets: These faucets allow users to complete offers or surveys in exchange for cryptocurrency.

• Gambling faucets: Users are able to bet using these faucets to potentially increase their cryptocurrency earnings.

• Mining faucets: By utilizing their computers’ processing capacity to solve mathematical problems, users can use these faucets to earn cryptocurrency.

• Airdrop faucets: These faucets give users free cryptocurrency in exchange for completing tasks or holding certain cryptocurrencies.

The latter type, even if considered by many to be a faucet, is actually slightly different, as crypto airdrops are often used as a marketing strategy to promote a new cryptocurrency or to increase the adoption of an existing one.

Pros and Cons of Crypto Faucets

Crypto faucets are designed to provide users with free cryptocurrency so they will take the time to learn about digital assets and, ideally, invest in them. However, there are some contraindications related to this phenomenon, which should be treated with caution. Below are some pros and cons of a crypto faucet.

Pros

• They are a good way for beginners to get their first taste of cryptocurrency.

• They can be a source of small amounts of cryptocurrency for users who don’t have the means to purchase it.

• They may serve as a resource for learning about cryptocurrencies and the blockchain technology that powers them.

Cons

• Since faucets often only give out extremely modest amounts of cryptocurrency, it can take a while to build up a substantial amount.

• The value of the cryptocurrency earned through faucets may fluctuate significantly, making it difficult to predict the value of earnings over time.

• Some faucets could ask users to perform time-consuming or frustrating tasks.

Risks Associated With Crypto Faucets

The thought of earning free money is awesome, but you need to be very careful when making use of any crypto faucet. There are lots of scams out there. Some sites will allow the users to complete all the tasks both simple and complex, but will not allow them to withdraw any reward at the end.

Most crypto faucets will also require you to download files. These files can be malicious and capable of destroying your device. Hence you need to be extremely careful when clicking links or downloading files. A lot of faucets earn money by advertising other brands and will require you to view these ads. These ads could be fake, misleading, and also capable of infecting your device.

As you are planning to make free money, have in mind that it takes lots of time and energy to earn something tangible. Except for a few faucets, the reward is usually not worth the sacrifice.

Conclusion

The launch of cryptocurrency has opened up tons of opportunities for individuals to earn money, a crypto faucet is just one of them. As more people pour into crypto space, there is a significant decrease in the reward earned compared to when the technology was at its initial stage. No crypto faucet will offer you anything close to 5 BTC for just completing simple tasks now.

It is also worth knowing that a crypto faucet is not a get-rich-quick scheme. To earn something tangible there is a need to dedicate some time and energy to it. You might be lucky if the price of the crypto you collected goes up. Before choosing any faucet, endeavor to do your research to avoid being a victim of online scams.