What is Airdrop?
Free tokens distributed to wallets, usually to promote a new project or reward early users. The ATO generally treats airdrops with value as ordinary income at receipt.
An airdrop is a giveaway: a project sends tokens to wallets, either to bootstrap attention or to reward early users of a protocol before its token existed. Some airdrops have been famously valuable to people who'd merely used an app early; the vast majority are marketing dust.
Two cautions carry the weight. Tax first: the ATO generally treats airdropped tokens with a market value as ordinary income at receipt — free coins arrive with a tax bill attached, and later selling adds a CGT event on top. Security second: "claim your airdrop" is a top-tier phishing lure — real airdrops never need your seed phrase, and a surprise token appearing in your wallet is sometimes bait designed to lead you to a malicious site. Ignore unknown tokens; never interact with them.
See it in practice
Related terms: Capital gains tax (CGT) · Phishing · Seed phrase · full glossary
FAQ
Do I really pay tax on free tokens?
Generally yes — airdrops with an established value are ordinary income at their AUD value when received. If the token has no market or value yet, treatment can differ; records of what arrived and when matter either way.
A token I never bought appeared in my wallet — what do I do?
Nothing. Don't sell it, don't approve it, don't visit the website it advertises. Unsolicited tokens are frequently bait for approval-draining scams; the safe interaction count is zero.
General information only, not financial advice. Definitions are maintained in our fact database and reviewed with the daily rebuild.