Crypto Capital Shifts From Token Launches to Publicly‑Listed Crypto Companies, DWF Labs Reports
Investor funds are increasingly flowing into crypto‑related equities as new token sales stumble, according to a study by market‑maker DWF Labs that draws on Memento Research data covering hundreds of launches across major exchanges.
Token launches under pressure
An analysis of token generation events (TGEs) for a broad set of projects — excluding meme‑coins and focusing on ventures with a product or protocol roadmap — shows that more than four‑fifths of the examined tokens traded below their opening price on the exchange. Within roughly three months of listing, typical price drops ranged from 50 % to 70 %, indicating that most retail and institutional buyers incur losses shortly after a token’s debut.
Andrei Grachev, managing partner at DWF Labs, told Cointelegraph that the pattern reflects a systemic post‑listing decline rather than a temporary market wobble. “The highest price a token usually reaches occurs in the first few weeks, after which selling pressure from airdrops, early‑investor unlocks and speculative exit strategies pushes the price down,” he explained.
A pronounced rotation into crypto‑related equities
While token markets have softened, capital formation in the traditional equity arena tied to the crypto sector has surged. Fundraising for crypto‑focused initial public offerings (IPOs) totaled approximately $14.6 billion in 2025, a near‑50‑fold increase year‑over‑year. Merger‑and‑acquisition (M&A) activity also hit a five‑year high, exceeding $42.5 billion.
Grachev interprets the data as a rotation of investor appetite rather than an outright withdrawal from the space. “If money were simply leaving crypto, we wouldn’t see IPO proceeds exploding and M&A numbers hitting multi‑year peaks,” he said.
Valuation gap between tokens and stocks
DWF’s report compares the valuation multiples of listed crypto firms—including Circle, Gemini, eToro, Bullish and Figure—to those of comparable token projects. Public equities were trading at price‑to‑sales ratios ranging from roughly 7× to 40×, whereas tokens generally fetched 2× to 16× sales. The disparity, the firm argues, stems largely from accessibility.
Institutional investors such as pension funds and endowments are generally limited to regulated securities markets. Public shares can be incorporated into index funds and ETFs, automatically generating demand from passive vehicles that cannot hold unregistered digital tokens.
Maksym Sakharov, co‑founder and group CEO of WeFi, corroborated the shift, noting that tighter risk appetites push investors toward “cleaner” ownership structures that provide clearer disclosure and enforceable rights. He added that the capital is flowing into businesses that serve as the underlying infrastructure of the crypto economy—custody providers, payment processors, brokerage platforms and compliance services—because these entities can be wrapped in an equity vehicle that aligns with real‑world adoption and regulatory scrutiny.
Why equities are becoming the preferred exposure
According to the interviewees, tokens alone do not substitute for a functional product or a revenue‑generating business model. When a project fails to sustain user activity, transaction volume or fee income, its token price becomes driven largely by expectations rather than fundamentals, leading to the steep post‑launch corrections observed in the data.
Publicly listed crypto firms, while not devoid of risk, offer investors a more familiar set of analytical tools: audited financial statements, corporate governance frameworks, and the ability to lodge legal claims. By contrast, holding tokens often requires navigating custodial approvals and bespoke policy stipulations that many institutional investment guidelines prohibit.
Outlook
Grachev characterises the emerging landscape as structural rather than cyclical. Tokens will continue to play a role in network incentives and governance, but institutional capital is likely to favour equity‑based exposure for the foreseeable future. “We are witnessing a lasting bifurcation,” he concluded. “Protocols that generate genuine revenue will thrive, while speculative token projects will encounter a tougher funding environment.”
Key Takeaways
- Token performance: Over 80 % of studied token launches fell below their initial listed price, with typical 50‑70 % drawdowns within 90 days.
- Capital migration: Crypto‑related IPO fundraising reached $14.6 bn in 2025, and M&A activity climbed to $42.5 bn, both at multi‑year highs.
- Valuation disparity: Public crypto equities trade at 7‑40× sales versus 2‑16× for tokens, reflecting greater accessibility and inclusion in institutional portfolios.
- Investor preferences: Institutional investors are gravitating toward equity structures that provide regulatory clarity, governance standards, and the ability to integrate into indexed funds.
- Future dynamics: The sector is likely to see a durable split—well‑funded, revenue‑driven protocols will persist, while the long tail of speculative token launches will face increasingly scarce funding.
The analysis draws on data from Memento Research and comments from DWF Labs and WeFi executives. As market conditions evolve, investors should conduct independent due diligence before allocating capital.
Source: https://cointelegraph.com/news/crypto-capital-rotates-from-tokens-to-stocks-as-new-launches-struggle-dwf?utm_source=rss_feed&utm_medium=feed&utm_campaign=rss_partner_inbound
