How are airdrops taxed?

Any cryptocurrency you receive as part of an airdrop should be taxed as ordinary income, with the fair market value of the coins on the day you received them serving as the basis for the taxable income. As a result, airdrops are taxed in the same way that cryptocurrency earned through mining and staking is.

The monetary value of coins acquired through an airdrop should be taxed as ordinary income, akin to paid-up bonus shares. Airdrops are more coins a coin holder receives for an existing holding of coins on a chain, similar to how bonus shares are additional shares a shareholder receives for an existing holding of shares in a corporation.