By Key Points
- US Crypto Airdrop Losses Exceed $5 Billion Due to Geoblocking
- US crypto holders lost between $2.64B and $5.02B due to geoblocking.
- Strict SEC regulations forced crypto projects to block US users.
- Millions of Americans were excluded from major airdrops.
- The US government lost nearly $3B in tax revenue.
A recent study by Dragonfly revealed that American crypto investors may have missed out on up to $2.64 billion in free cryptocurrency airdrops due to geoblocking restrictions. Meanwhile, another analysis by CoinGecko estimated this number could be as high as $5.02 billion.
The primary reason? Stringent SEC regulations.
Sample Group Airdrop Claim Data (As of January 28, 2025). Source: Dragonfly – Techtoken
To avoid potential legal action from the US Securities and Exchange Commission (SEC), most crypto projects blocked US-based IP addresses from claiming airdrops. This affected millions of crypto users, shutting them out of lucrative token distributions from projects like Uniswap, 1inch, and Blur.
Dragonfly’s study examined 12 major crypto airdrops, with 11 of them explicitly banning US participants. The report estimates that between 920,000 to 5.2 million US investors were impacted by these restrictions.
This is particularly significant because US-based crypto users represent nearly 24% of all active crypto addresses worldwide. The report found that the total value of airdrops analyzed amounted to $7.16 billion, with an average airdrop claim of $4,600 per eligible wallet.
Estimated Percentage of US Active Addresses of the World in 2024. Source: Dragonfly – Techtoken
However, because of regulatory uncertainty, these funds never reached American investors.
Check out how US banks are tightening crypto rules, making it even harder for investors to access digital assets.
US residents are missing out on billions.
Because of unclear regulations, Americans can’t access crypto airdrops.
This has affected millions of people, and they’re just the beginning… 🧵 pic.twitter.com/twZpwHApFb
— Matt (@0xMatt1) March 11, 2025
US Crypto Policies Cost Billions in Lost Tax Revenue
The impact of these restrictions goes beyond just individual investors—the US government is also losing out.
According to CoinGecko’s research, the lost tax revenue from unclaimed airdrops between 2020 and 2024 is estimated to be:
- $418M to $1.1B in federal income tax losses.
- $107M to $284M in lost state taxes.
- A total estimated loss of $525M to $1.38B in tax revenue.
But the damage doesn’t stop there. Many crypto firms are moving their operations overseas to avoid SEC scrutiny, further reducing US tax collection.
For example, Tether relocated its headquarters to El Salvador, potentially costing the US economy:
- $1.3 billion in federal corporate tax losses.
- $316 million in state tax losses.
JUST IN: 🇸🇻 Tether to relocate to El Salvador. 🔥 pic.twitter.com/eFi70Bbz8V
— Bitcoin Archive (@BTC_Archive) January 13, 2025
With increasing uncertainty surrounding SEC regulations, many crypto projects prefer to block US users entirely rather than risk legal battles. High-profile cases involving Ripple, Kraken, and Coinbase have shown that the SEC is aggressively targeting crypto companies, making geoblocking a safer option.
Curious about how regulations are shifting? The US House recently voted to overturn the IRS DeFi broker rule, a move that could reshape crypto tax policies.
Will This Push More Crypto Projects Out of the US?
As regulatory pressure intensifies, more blockchain companies may choose to leave the US altogether. Some have already moved to crypto-friendly nations like Singapore, Switzerland, and El Salvador.
Even major players like Michael Saylor have expressed concerns. His Bitcoin reserve plan highlights how businesses are adjusting their strategies to navigate strict US policies.
I shared this today at the White House Digital Assets Summit. https://t.co/cmOXdDC9pd
— Michael Saylor⚡️ (@saylor) March 7, 2025
At the same time, market trends indicate that investor sentiment is shaky. Solana’s recent price drop is a clear example of how regulatory fears and external pressures are impacting the crypto space.
With the SEC continuing its crackdown and projects prioritizing legal safety, American crypto investors could keep missing out on major opportunities unless the regulatory landscape shifts.
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