85% of 2025 Token Launches Trade Below Launch Price as VC Power Waned
85% of crypto tokens launched in 2025 are trading below their launch price, according to analyst Edgy of The DeFi Edge. The trend holds even for many VC-backed projects, with several trading deep in the red. Crypto venture capital fundraising has collapsed since its 2022 peak — Q2 2022 saw nearly $17 billion raised and 80+ new funds, while recent quarters show fundraising at just 12% of that peak. Although $8.5 billion was deployed last quarter (up 84% QoQ), The DeFi Edge and Galaxy Research note much of that comes from capital raised in 2022 rather than fresh LP commitments. New fund formation is at a five-year low and VC returns have been falling since 2022. The article argues the traditional model—landing a top VC to drive token demand and offload to retail—is breaking down. As VC influence fades, tokens from projects with real users, revenue, fairer launch models and community-driven ecosystems are gaining attention. Key takeaways for traders: high proportion of 2025 token launches are underwater, VC backing is a weaker signal than before, and capital deployment figures may overstate current investor appetite because much capital is recycled from earlier vintages.
Bearish
The data—85% of 2025 token launches trading below launch price plus collapsing VC fundraising and declining VC returns—signals weakened demand for newly issued tokens and reduced effectiveness of VC endorsement as a price catalyst. Recycled 2022 capital inflating deployment figures suggests limited fresh buying power. Historically, periods when retail and institutional demand fall (e.g., post-2018 ICO bust) lead to extended price weakness for newly issued tokens and higher volatility. Short-term, expect continued selling pressure on recent token listings, wider bid-ask spreads, and increased sensitivity to on-chain metrics (user growth, revenue) rather than investor names. Liquidity may be thin for many new tokens, raising execution risk. Long-term, the market could reprice valuation premia toward projects with demonstrable usage and revenue rather than speculative launches; capital formation may consolidate into fewer, more resilient funds and projects. Overall, these dynamics are negative for token prices and increase downside risk for traders focused on new listings, while providing selection opportunities for traders who can identify genuinely user-driven projects.