Investors Abandon New Tokens for Listed Crypto Companies

Data from DWF Labs and Memento Research shows that more than 80% of tokens launched last year are trading below their token generation event (TGE) price. Many of them dropped between 50% and 70% within the first 90 days, triggering what analysts describe as a structural rotation away from new tokens and toward regulated crypto equities.

The result has been a surge in crypto-related IPO activity, with fundraising climbing to $14.6 billion as investors look for alternatives to the struggling token model.

Token Launches Face Widespread Losses

Research tracking 118 token generation events in 2025 found that 84.7% are currently below their launch price. Median drawdowns have been severe across major exchanges, with new listings showing a 71% decline in fully diluted valuation and a 67% drop in market capitalization shortly after going live.

On Binance, several high-profile venture-backed projects from 2024 reported steep losses, with some declining nearly 90% from their initial valuations.

Bybit and KuCoin recorded median returns of -70.4% and -66.1% for 2024 listings.

OKX showed slightly better resilience, though still negative overall, with just 27.6% of its listings remaining profitable through the third quarter of 2024.

The pattern suggests that the typical token launch structure is struggling to deliver sustainable value.

Why Investors Are Moving to Crypto Stocks

Analysts describe the capital migration as a “flight to quality.” Publicly traded crypto companies such as Circle, Gemini, and eToro are trading at price-to-sales multiples ranging from 7x to 40x. Comparable tokenized projects often sit between 2x and 16x.

Institutional investors face structural constraints that limit their ability to buy unregistered tokens. Regulated securities such as crypto IPOs and ETFs offer clearer compliance frameworks, audited financials, and defined shareholder rights.

Capital is also shifting toward infrastructure-focused businesses – including custody, compliance, and payments providers. Unlike tokens, equities offer legal licensing and corporate transparency, which many large funds require.

The TGE Is Losing Its Power

Market commentary suggests that the token-first funding model is no longer working as intended.

High fully diluted valuations combined with low circulating supply at launch have created pressure points. Retail buyers often enter at elevated valuations, while early venture investors and airdrop recipients sell into early liquidity.

The rise of so-called “mercenary capital” during 2025 worsened the issue. Airdrop participants frequently had no long-term commitment to projects, inflating engagement metrics temporarily before exiting.

While tokens can generate explosive short-term gains during their first month of trading, crypto equities have demonstrated more stable growth trajectories over longer periods.

As 2026 progresses, the data suggests that investors are reassessing risk, valuation discipline, and regulatory clarity – reshaping how capital enters the digital asset sector.

The information provided in this article is for educational purposes only and does not constitute financial, investment, or trading advice. Coindoo.com does not endorse or recommend any specific investment strategy or cryptocurrency. Always conduct your own research and consult with a licensed financial advisor before making any investment decisions.

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