Want to know what a Bitcoin Faucet is? You’ve come to the right place!
A Bitcoin Faucet is essentially a reward based system which issues small increments of Bitcoin to users.
Bitcoin Faucets typically issue Bitcoin to users in small increments called Satoshi. Most often the rewards are given out in exchange for them completing a task such as a Captcha form, or watching a short video advert.
Bitcoin, on tap…
Bitcoin Faucets take their name directly from ‘Faucets’ – another word for a ‘tap’, or more technically “a valve controlling the release of a fluid or gas”. Much in the same way that a tap can be activated to give you water, a Bitcoin Faucet can be activated and will “drip feed” you some Bitcoin!
Bitcoin Faucets are most often found on specialist websites or apps, which make a point of being know for places to get free Bitcoin. Alternative Faucets might also dispense Altcoins (other types of Cryptocurrency).
The first Bitcoin Faucet
It’s understood that Gavin Andresen (Chief Scientist at The Bitcoin Foundation), created the first bitcoin Faucet, back in 2010. At the time, it dispensed 5BTC to visitors as a way of introducing the world to Bitcoin. 5BTC! Just think how much that is worth today!!
Bitcoin Faucets typically dispense rewards at certain time intervals, or upon completion of a task. The size of the reward is usually relatively small in terms of a whole Bitcoin, but can vary and also be random depending on the function / nature of the Faucet you use.
Because of the mining fees and effort involved in transacting and transferring Bitcoin rewards, operators of Bitcoin Faucets will typically impose a minimum threshold of Satoshi or BTC which you have to accrue, before you can withdraw your rewards and have it sent to your BTC wallet. This makes a lot of sense. Making a huge number of micro-transactions in Bitcoin can be very costly and in-efficient.
Why do Bitcoin Faucets exist?
Operators of Bitcoin Faucets tend to have a number of drivers / reasons for offering free Bitcoin, and normally 1 or multiple of the following 3 reasons:
- To educate people on Bitcoin and introduce new users to the Blockchain technology and Crypto Currencies. Faucets are a great way to promote Crypto Currencies and get people to try out Bitcoin without having to invest and risk their own cash upfront. There’s also an education and adoption play here. The Bitcoin community largely wants mass consumer adoption of Bitcoin and Crypto Currencies, and so Faucets are a cheap and efficient means of promoting this.
- To increase traffic to their website(s). Offering Free Bitcoin is a very attractive proposition, and let’s face it – who’s never been attracted to the offer of free money? Many Bitcoin Faucet operators want to attract as much traffic and eyeballs to their websites as possible. Bitcoin Faucets are great for this.
- Monetisation – making money out of web traffic. The opportunity for many Faucet owners is to make money out of your visit to their website or app. They may well do this by serving up adverts for which they get paid. They may offer up a pot of Bitcoin for their users to get at. However you can safely assume that what they’re doing here is “spending money to make money”, and that they’re being paid a larger sum in advertising fees. The difference between the two values (the Bitcoin they offer, and the advertising revenue which they receive), is their profit margin. Some advertisers may even pay them in Bitcoin, so they’ll offer up a portion of that revenue directly. To break even and even hope of making any money, Bitcoin Faucets need to generate very significant amounts of web traffic. They need this to make sure their advertising revenue covers the cost of their payments processing, web hosting and other costs.
Our favourite Bitcoin Faucet
Amongst the huge list of Bitcoin Faucets available today, our favourite from personal experience is Free Bitco.in. With it’s great bonus system and added raffle game, it really is a fun way to earn some free Bitcoin!
Want to earn some free Bitcoin and try out a Bitcoin Faucet for yourself?
Here’s our List of the Best Free Bitcoin Faucets.