Americans Miss Out on Over $5 Billion in Crypto Airdrop Revenue Due to Geoblocking

A study by Dragonfly indicates that Americans may have missed out on up to $2.64 billion from cryptocurrency airdrops. 

Notably, another study by CoinGecko suggests this figure could be as high as $5.02 billion. So, what are the reasons behind this situation?

Americans Face Restrictions in Participating in Cryptocurrency Airdrop

Dragonfly’s research findings are based on 12 cryptocurrency airdrops, including Uniswap and 1inch. Of these, 11 airdrops imposed restrictions on US IP addresses. Dragonfly discovered that the number of Americans affected by this IP blocking ranged from 920,000 to 5.2 million active users. This accounts for 5–10% of the 18.4 to 52.3 million cryptocurrency holders in the US impacted by geoblocking policies in 2024.

Sample Group Airdrop Claim Data (As of January 28, 2025). Source: Dragonfly

Approximately 22–24% of all active cryptocurrency addresses worldwide are US residents. The total value of the airdrops in Dragonfly’s sample amounted to around $7.16 billion. Approximately 1.9 million people globally claimed airdrops, with an average value of about $4,600 per eligible wallet address.

Estimated Percentage of US Active Addresses of the World in 2024. Source: Dragonfly

Based on these figures, Dragonfly estimates that Americans lost between $1.84 billion and $2.64 billion from 2020 to 2024 due to the 11 airdrops that blocked US users. Notably, CoinGecko conducted a similar analysis but with a larger sample size. Evaluating 21 airdrops that excluded Americans, CoinGecko estimates the losses could range from $3.49 billion to $5.02 billion.

The exclusion of US IP addresses from participating in crypto airdrops is a measure to avoid penalties from regulatory bodies like the Securities and Exchange Commission (SEC).

US Government Loses Nearly $3 Billion Due to Stringent Policies

The lost federal personal income tax revenue from geoblocked airdrops, based on CoinGecko’s sample from 2020 to 2024, is estimated to range from $418 million to $1.1 billion. The estimated lost state tax revenue ranges from $107 million to $284 million. This represents an estimated tax revenue loss of $525 million to $1.38 billion.

The relocation of cryptocurrency operations overseas has also significantly reduced US tax revenue. The report cites Tether as an example. Companies like Tether establishing headquarters in El Salvador may have cost the US approximately $1.3 billion in federal corporate taxes and $316 million in state taxes.

Crypto projects show caution amid potential legal challenges ahead of the new acting SEC Chair under President Trump’s administration. Blocking and losing a portion of US users is considered a safer option than facing costly litigation as is the case with Ripple, Kraken, or Coinbase.