The latest news on crypto reveals that US investors have lost out on billions of dollars in airdropped tokens, thanks to strict regulatory policies enforced by the Securities and Exchange Commission (SEC). According to an analysis by venture firm Dragonfly, cryptocurrency exchange companies and blockchain-based projects are actively avoiding US-based users due to concerns over potential legal issues. This crackdown is not only affecting investors but also costing the US government cryptocurrency tax revenue.
Airdrops in crypto are a common way for blockchain projects to distribute newly issued tokens to early adopters and active users. However, the SEC has suggested that certain airdropped tokens may be considered securities, meaning they would be subject to strict registration and disclosure requirements similar to stocks and bonds.
To avoid facing lawsuits, many cryptocurrency exchange companies and blockchain projects have decided to block US-based users from claiming these free tokens. One notable example is the Hydrogen case, where the SEC sued a company for offering unregistered securities through an airdrop. This has led to widespread geo-blocking by crypto companies, leaving American investors on the sidelines while the rest of the world benefits from these distributions.
Dragonfly’s report analyzed a sample of 11 major airdrops and found that between 15% and 44% of potential claimants were likely based in the US. This means that US-based cryptocurrency companies and investors who were otherwise eligible for these airdrops likely missed out on at least $1.8 billion in crypto tokens.
On a larger scale, crypto data company CoinGecko estimated that global airdrops in 2024 have distributed over $26 billion worth of tokens, with 29 out of 50 major airdrops explicitly blocking US users. With dozens—if not hundreds—of airdrops happening each year, the actual financial loss for US investors is likely much higher than the conservative $1.8 billion figure.
The financial consequences extend beyond individual investors. Since airdropped tokens are considered taxable income, the US government cryptocurrency tax revenue has taken a hit as well. The report estimates that the federal government has lost at least $418 million in uncollected taxes, while state governments have lost an additional $107 million.
Beyond tax revenue, these policies are driving crypto innovation overseas. With strict US cryptocurrency regulation in place, many blockchain in cryptocurrency projects are opting to launch in more crypto-friendly jurisdictions. This means fewer opportunities for US-based cryptocurrency companies, fewer jobs in the blockchain space, and a weakening position for the US in the global crypto economy.
While the regulatory landscape has been tough for crypto enthusiasts, there are signs of change. According to Dragonfly’s associate general counsel Jessica Furr, discussions between the crypto industry and the SEC have intensified in early 2025, hinting at a potential softening of regulatory restrictions.
This shift in attitude could mean clearer rules and better guidelines for airdrops of crypto and other blockchain-based innovations. If regulatory bodies and cryptocurrency exchange companies find common ground, the US could reclaim its position as a leader in blockchain innovation.
The exclusion of US investors from major crypto airdrops highlights the broader impact of current US cryptocurrency regulation. As policymakers reassess their stance, there’s hope that future regulations will balance investor protection with innovation. Until then, US-based cryptocurrency companies and investors will have to navigate a challenging landscape while the rest of the world enjoys the benefits of blockchain in cryptocurrency.
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