TLDR
Capital is rotating from new token launches to IPOs and other equity deals for crypto companies as token performance disappoints and regulated listings scale up.
- Recent research shows over 80% of 2025 token launches trade below their initial price, with typical 5070% drawdowns within 90 days.
- Crypto-related IPO fundraising hit about $14.6 billion in 2025, a 48x year-on-year jump, alongside record M&A in the sector.
- Institutional capital increasingly prefers equity and tokenized securities, leaving tokens mainly for incentives and governance, which changes how retail investors access crypto growth.
Deep Dive
1. Why Token Launches Are Lagging
Analysis by DWF Labs and Memento Research finds that more than 80% of tokens launched in 2025 now trade below their token generation event (TGE) price, with typical drawdowns of 5070% within 90 days of listing, even after excluding memecoins and focusing on structured launches tied to real products or protocols. This pattern is described as structural selling pressure from airdrops and early investor unlocks rather than short term noise, with most tokens peaking in the first month then grinding lower due to scheduled supply hitting thin secondary markets.
A separate 2025 study by Arrakis Finance covering 125 token generation events found that 85% of tokens finished the year below launch, and only about 1 in 10 weak launches that dropped early ever recovered to their initial price, underscoring how early design and unlock mechanics dominate outcomes, more than whether the broader market is bullish or bearish.
For most new tokens, the default pattern is early hype, then sustained selling into unlock calendars, which makes buy-and-hold on new launches statistically challenging without very strong fundamentals.
2. How Crypto IPOs And Equity Deals Are Surging
The same DWF and Memento dataset shows crypto-related IPO fundraising in 2025 reaching roughly $14.6 billion, a 48x increase versus the prior year, while M&A volume climbed above $42.5 billion, the highest in five years. Infrastructure players such as Circle, Gemini, eToro, Bullish and Figure are cited as examples of listed or listing-bound firms whose shares trade at price-to-sales multiples around 740x, compared with 216x for comparable token projects.
Separately, sector reviews of Q1 2026 raise activity highlight BitGos NYSE listing, which raised about $213 million at a valuation just over $2 billion, plus dozens of other funding rounds where mature crypto infrastructure firms tapped IPOs, PIPEs and post-IPO equity offerings rather than issuing new tokens. Venture funds like Dragonfly are explicitly steering new capital toward real-world asset tokenization and financial infrastructure companies, not consumer tokens.
The growth capital that once defaulted to token sales is increasingly flowing into regulated equity and debt for exchanges, custodians and payments firms, deepening their moat while leaving fewer high-quality token launches.
3. Why Capital Prefers Equity Over Tokens Now
DWFs report argues this is a rotation inside crypto, not money leaving the sector. Institutional allocators are constrained to regulated securities that can sit inside traditional mandates, indexes and ETFs, so they can buy shares of a crypto exchange or custodian far more easily than a governance token. Equity also offers cleaner ownership, audited financials and enforceable shareholder rights, which many investors now prioritize over reflexive tokenomics.
Grachev and other contributors conclude that tokens are increasingly treated as tools for incentives and governance, while serious capital formation for revenue-generating businesses happens via equity rails. For token investors, this means fewer clear-cut growth equals token upside stories and more cases where a successful product lives behind a stock, not a coin, while the token trades mainly on narrative and rewards.
To capture the same underlying growth, investors may need to look across the full stack of vehicles, distinguishing when value accrues to a token, an IPO stock, or tokenized securities instead of assuming every successful protocol will reward its coin.
Conclusion
Token launches are not disappearing, but data shows most recent ones have delivered poor risk-reward, while crypto IPOs and infrastructure equity deals have become the preferred channel for large, regulated capital. This shift pushes real value capture toward exchanges, custodians and payment rails raising money in traditional markets, leaving many tokens as secondary instruments for incentives rather than primary claims on cash flow. For crypto users, the key is to track where the economic rights actually sit in each project, and watch how upcoming regulation, token design and listing choices decide whether upside flows to coins, stocks or on-chain securities.
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