What is a free referral code?

Excuse me, could you please explain what a free referral code is? I've heard it mentioned in the context of cryptocurrency and finance, but I'm not entirely sure what it entails. Is it some sort of promotion or incentive offered by a platform or service to encourage users to refer others? And if so, how does it work? Does it provide any tangible benefits to both the referrer and the referee? I'd really appreciate it if you could clarify this for me.