Americans May Have Missed Out on Billions of Dollars’ Worth of Crypto Airdrops: Dragonfly

A new report from crypto venture capital fund Dragonfly estimates that geoblocking policies in cryptocurrency airdrops—typically due to regulatory concerns—have potentially cost U.S. users billions of dollars’ worth of lost revenue from 2020-2024. 

The analysis is part of Dragonfly’s “State of Airdrops 2025” report, in which the firm analyzed data from 12 distinct Ethereum-based airdrops, a popular crypto reward mechanic that typically involves giving tokens to current or historical users of a given protocol.

Of the 12 large-scale airdrops included in the data set, 11 utilized geoblockers restricting U.S. residents from participating or receiving tokens. Just between those projects alone, estimates range between $1.84 and $2.64 billion worth of U.S. user token shares that may have gone unclaimed due to location restrictions.

“Understanding the scale of U.S. participation and the financial implications of restrictive policies is critical for informing future regulatory decisions,” reads the report. “We aim to quantify the impact of geoblocking policies on cryptocurrency airdrops for U.S. residents and to assess the broader economic consequences of these policies.” 

The report covers a sample of significant Ethereum token airdrops like the Bored Ape Yacht Club-linked ApeCoin (APE), along with Arbitrum (ARB), EigenLayer (EIGEN), and the Ethereum Name Service (ENS). Even among a relatively small sample of projects, American users may have missed out on billions of dollars’ worth of value.

A larger set of airdrop data gathered by CoinGecko and cited by Dragonfly, which includes 21 airdrops, indicates that the upper range could be as high as $5.02 billion. And while some users may have used workarounds like VPNs to get around the blocks, there’s likely still a substantial portion of would-be recipients that never claimed their token shares.

“The economic repercussions of geoblocking on U.S. users are profound, with significant revenue losses that affect both the individual claimers and the broader economic landscape,” the report continues.

That broader economic landscape includes a sizable percentage of missed tax revenues for state and federal governments as well. Utilizing individual tax rates, Dragonfly estimates that the federal tax revenue loss could be as high as $1.1 billion, while states may have missed out on as much as $284 million.

To rectify that situation, the firm provided a handful of recommendations about how regulators could better work with the industry to find a suitable approach to crypto airdrops, something it calls an “important strategic tool to create excitement and build awareness around a project.” 

Those recommendations include aligning airdrops with the tax status of credit card rewards points, providing safe harbor to previous airdops and their respective protocols, and continued engagement of congress with the crypto industry.

Of late, regulators have been increasingly willing to work towards resolutions with crypto companies, highlighted by the U.S. Securities and Exchange Commission’s growing list dropped lawsuits and investigations under President Trump.

Whether regulatory clarity will come as it relates to token airdrops though remains to be seen.  

“To unlock the full potential of airdrops while safeguarding user and market integrity, we call for regulatory clarity and tailored frameworks,” writes Dragonfly. “By embracing such regulatory modernization, the U.S. can cultivate a thriving blockchain ecosystem that drives technological advancement, economic growth, and global competitiveness.”

Edited by Andrew Hayward