Investor capital increasingly flows from tokens into publicly listed crypto companies as new token launches struggle, according to research and commentary from market maker DWF Labs.
Drawing on Memento Research data covering hundreds of token launches across major centralized and decentralized exchanges, the firm said more than 80% of projects have fallen below their token generation event (TGE) price. Typical drawdowns range between 50% and 70% within roughly 90 days of listing, suggesting public buyers often face immediate losses after launch.
DWF Labs managing partner Andrei Grachev told Cointelegraph that the figures reflect a consistent post-listing pattern rather than short-term market volatility. He said most tokens reach a price peak within the first month and then trend downward as selling pressure builds.
“TGE price is the exchange-listed price set before launch,” Grachev said. “This is the price the token is set to open at on the exchange, so we can see how much the price actually changes due to volatility in the first few days,” he added.
The analysis focused on structured launches tied to projects with products or protocols, rather than memecoins. Airdrops and early investor unlocks were identified as major sources of selling pressure.
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Crypto IPOs, M&A surge as capital shifts from tokens
In contrast, capital formation has strengthened in traditional markets tied to the sector. Fundraising for crypto-related initial public offerings (IPOs) reached about $14.6 billion in 2025, up sharply from the prior year, while merger and acquisition (M&A) activity surpassed $42.5 billion, the highest level in five years.
Grachev said the shift should be understood as a rotation rather than a withdrawal of capital. If capital were simply leaving crypto, you wouldn’t see IPO raises jump 48x year-over-year to $14.6 billion, M&A hit a 5-year high of over $42.5 billion, and crypto equity performance outpacing token performance,” he said.
In its report, DWF compared listed companies such as Circle, Gemini, eToro, Bullish and Figure with tokenized projects using trailing 12-month price-to-sales ratios. Public equities traded at multiples between roughly 7 and 40 times sales, compared with 2 to 16 times for comparable tokens.
The firm argued that the valuation gap is driven by accessibility. Many institutional investors, including pension funds and endowments, are restricted to regulated securities markets. Public shares can also be included in indexes and exchange-traded funds, creating automatic buying from passive investment products.
Maksym Sakharov, co-founder and group CEO of WeFi, also confirmed to Cointelegraph that there has been a capital rotation from token launches. “When risk appetite tightens, investors don’t stop craving exposure, so they start demanding cleaner ownership, clearer disclosure, and a path to enforceable rights,” he said.
Sakharov added that the money is going toward businesses that look like infrastructure because of custody, payments, settlement, brokerage, compliance and plumbing. He noted that the “equity wrapper” is attractive because it aligns with real-world adoption, enabling licensing, audits, partnerships and distribution channels.
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Why investors favor crypto equities over tokens?
The market is increasingly treating tokens and businesses as separate things, Sakharov said, noting that a token alone cannot replace distribution or a working product. If a project fails to generate steady users, fees, transaction volume and retention, the token ends up priced on expectations rather than real activity, which is why many launches look successful at first but later disappoint.
Listed crypto equities are not necessarily safer, but they are clearer and easier for investors to evaluate, according to Sakharov. Public companies offer reporting standards, governance and legal claims, and they fit within institutional portfolio rules, whereas holding tokens often requires custody approvals and policy changes.
Grachev described this shift as structural rather than cyclical. While tokens will remain part of crypto networks for incentives and governance, he said institutional capital increasingly prefers equity rails.
“Tokens won’t disappear, but we’re seeing a permanent bifurcation: serious protocols with real revenue will thrive, while the long tail of speculative launches faces a much harder environment,” he concluded.
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