Imagine if Tether, the big shot in the stablecoin world, had set up shop in the US. It could've shelled out a whopping $1.6 billion in taxes! Now, wouldn’t that be a nice chunk of change for Uncle Sam?
Let's dive into the quirky world of airdrops – those little crypto sprinkles that keep the blockchain party lively and engage users like never before. They’re like the candy of the crypto universe, sweetening the deal for everyone involved by spreading the love and wealth around.
But here’s the kicker: Dragonfly’s latest scoop reveals how those pesky geoblocking policies, especially in the US, are throwing a wrench in the works. These restrictive rules are like party poopers, leading to missed financial chances, less partygoers, and some serious economic repercussions for both users and the government.
Dragonfly took a closer look at 12 airdrops between 2019 and 2023, zooming in on how geoblocking affected US users. The results? Between 920,000 and a staggering 5.2 million US crypto fans missed out on these digital giveaways, making up about 5-10% of all local investors. Ouch!
Even though the US is a major player in the global crypto scene, snagging 22-24% of all active blockchain addresses, these policies are shutting out a big slice of potential users from grabbing new tokens hot off the press.
Let’s talk dollars and cents. The report crunched the numbers on 11 geo-blocked airdrops, which collectively whipped up around $7.16 billion in total value. For the 1.9 million worldwide claimers, that meant an average haul of $4,600 per eligible address. Cha-ching!
However, for US users, the missed revenue was nothing to sneeze at, estimated between $1.84 billion and $2.64 billion from 2020 to 2024. And if you zoom out with a broader lens, the lost revenue climbs to an eye-popping $3.49 billion to $5.02 billion over the same period. Talk about a missed payday!
And it’s not just individuals feeling the pinch. The taxman’s missing out, too. The report highlights a potential loss of $418 million to $1.1 billion in federal tax revenue and $107 million to $284 million in state tax revenue, thanks to US users missing these freebie tokens. Total missed tax collections from these geo-blocked airdrops could range from $525 million to $1.38 billion. And that’s not even counting the extra taxes that could roll in from selling these tokens later on.
To top it off, the report points out how the offshore migration of crypto businesses is putting a dent in corporate tax revenues. Take Tether, for example, which raked in $6.2 billion in profits in 2024 while chilling offshore. If Tether had been under US tax jurisdiction, it could’ve contributed a cool $1.3 billion in federal corporate taxes and $316 million in state taxes. Talk about a missed opportunity for a nice tax windfall!
