The market is experiencing a prolonged revaluation. According to Galaxy Research, about 85% of tokens launched in 2025 are now trading below their TGE price. For many, the drop is measured in dozens of percent, and in some cases exceeds 70–80% of the initial valuation.
A few years ago, having a ‘top fund’ among investors automatically created a sense of quality. Listings were accompanied by growth, and retail investors entered expecting a repeat of the 2020–2021 scenarios. In 2026, this mechanism hardly works. An institutional logo on a project’s website no longer guarantees demand.
The Venture Model No Longer Drives the Market
The peak occurred in the second quarter of 2022. At that time, crypto venture funds raised about $17 billion in a single quarter, and more than 80 new structures entered the market. Money flowed into almost any project with a strong narrative and tokenomics promising a quick listing.
Now, the picture is the opposite. According to Galaxy, the amount of capital raised in the last quarter was only about 12% of Q2 2022 levels. The number of new funds has dropped to a five-year low. Venture investment returns in the sector have declined for the third year in a row.
At the same time, on paper, investment activity looks lively. In the last quarter, funds invested $8.5 billion, up 84% quarter-over-quarter. However, a significant portion of these funds is capital raised back in 2022. There is much less new money than headlines suggest. In fact, the market is eating through old cash.
TGE No Longer Means Growth
The model of ‘raise a round — launch a token — sell at listing’ is gradually losing effectiveness. The market has become sensitive to unlocks, insider shares, and aggressive tokenomics. Investors track unlock schedules and distribution volumes, not just marketing promises.
When 85% of 2025 launches are trading below TGE, it is not a signal of individual teams failing, but of a changing environment. Demand no longer automatically absorbs supply. Liquidity has become selective.
Projects with real users and revenue survive. Where there is organic demand, the drawdowns are less deep and recovery is faster. Everything else remains under selling pressure.
Bitcoin Has Increased Market Pressure
The correction intensified against the backdrop of bitcoin’s decline. Since October 6, when BTC hit a new cycle high, the price has fallen by 46%. At one point, the drop exceeded 52%. This is the largest pullback of the current cycle.
The fall to $60,000 changed the behavior of long-term holders. The seven-day EMA of the Long-Term Holder SOPR dropped below 1 for the first time after a long period of sustained profits. This means that some long-term investors have started to lock in losses.
A similar trend was observed in May 2022 during the LUNA crash. At that time, the pressure intensified in a cascade, and the market entered a full-fledged bear phase. Now, the picture is less dramatic, but the signals are similar.
The Spot Market Is Under Sellers’ Control
CryptoQuant analytics show that since October, the net delta of spot volume has remained consistently negative. This means that sales dominate over purchases.
On Coinbase, the average monthly outflow is about minus $89 million. On Binance, the figure is even higher — about minus $147 million. The pressure comes specifically from spot, not just derivatives. This indicates a real reduction in positions, not just temporary hedging.
Against this backdrop, new tokens face a double blow. First, venture support has weakened. Second, overall market liquidity has decreased.
Why Drawdowns Are Deeper for New Tokens
New assets are traditionally more sensitive to downturn phases. They have lower liquidity, a higher share of early investors, and often an aggressive unlock schedule. When the spot market is selling rather than buying, the pressure intensifies.
In addition, the market has become more skeptical of valuations. Multipliers that seemed justified in 2021–2022 are now seen as inflated. This leads to a revaluation and a gradual decline in prices to more realistic levels.
What Has Changed Structurally
The declining role of venture capital is gradually leveling the market. Listings are becoming less ‘insider,’ and the share of quick profit-taking is decreasing. Projects are forced to prove their value with the product, not just a funding round.
At the same time, this makes recovery slower. Without an aggressive influx of new capital, growth requires real demand. The market is restructuring.
What’S Next?
The current situation is not unique to the crypto market. Every cycle is preceded by a cleansing period. Capital becomes more cautious. Investors demand transparency. Liquidity is concentrated in strong assets.
85% of tokens below TGE is not just a sign of weakness, but also an indicator that the market is no longer automatically supporting projects. In conditions of limited liquidity, resilience is valued, not just a narrative.
As long as spot flows remain negative and bitcoin does not show a sustained reversal, pressure on new tokens may persist. However, it is precisely in such periods that the foundation is laid for the next stage of the market — one that is more mature and less dependent on venture capital.
Read More: Why Markets Look Unstable in 2026
