On April 10, 2025, Miles Jennings, the head of policy and general counsel at a16z crypto, published a report advocating for regulatory relief for crypto airdrops, proposing that a “safe harbor” should be established to protect airdrops from regulatory enforcement. This proposal is part of the industry’s ongoing push for more favorable regulations regarding crypto activities.
Airdrops—methods of distributing crypto tokens to holders—have come under scrutiny by the U.S. Securities and Exchange Commission (SEC), particularly under Chairman Gary Gensler. The SEC has argued that many crypto airdrops qualify as unregistered securities offerings, given its stance that most crypto assets are securities. However, Jennings disagrees with this perspective, stating that airdrops are not “sales” and are essential for blockchain projects to achieve decentralization and functionality.
Jennings also criticized the SEC’s regulatory approach, suggesting that the U.S. government’s stance has led to “perverse incentives” that have harmed Americans by excluding them from airdrops. This exclusion, he argues, deprives U.S. citizens of the opportunity to engage in the growing field of decentralized ownership on the internet.
To address these concerns, Jennings proposed five conditions that would allow airdrops to be excluded from U.S. securities laws. These conditions include:
Network Token: The token being a network token, meaning it derives its value from a decentralized blockchain, not a centralized company.
Operational Blockchain: The blockchain network should already be operational.
Broad Distribution: Airdrops should be broadly and equitably distributed, not limited to private investors or venture capitalists.
Free or Based on Past Usage: The airdrop should either be free or based on the recipient’s past engagement or usage of the network.
Lock-up Period for Insiders: Any portion of the airdrop allocated to insiders should be locked for at least one year to prevent manipulative practices like rug pulls.
Jennings believes these conditions would allow for a clearer, more equitable regulatory framework for airdrops, helping to foster innovation while avoiding burdensome restrictions.
Related topics:
Potential 50% Tariff on China: How Could It Impact Crypto Markets?
Dogecoin Price Resilience Amid Market Chaos: Is DOGE Decoupling from Musk’s Influence?
Expert Reveals Decentralized Strategy to Stabilize Pi Network Price
