85% of 2025 Crypto Tokens Now Trade Below TGE as Sell-Off Deepens

Crypto markets in 2026 are proving brutal for fresh projects. According to data from Galaxy Research, roughly 85% of tokens launched in 2025 are now trading below their Token Generation Event (TGE) price, highlighting just how severe the post-launch drawdowns have become.

What once worked - a big-name VC on the cap table and a hyped launch - is no longer enough to sustain price action.

VC Boom Turns Into Capital Hangover

Back in Q2 2022, crypto venture funds raised nearly $17 billion in a single quarter, with more than 80 new funds launching. Limited partners were pouring capital into nearly anything crypto-related. That era is over.

Fundraising last quarter reached only 12% of Q2 2022 levels, marking a five-year low for new crypto funds. Venture capital ROI has steadily declined every year since 2022, signaling a structural shift in investor appetite.

Some argue that VC investment is rebounding, pointing out that firms deployed $8.5 billion last quarter, up 84% quarter-over-quarter. However, Galaxy Research notes that this isn’t fresh capital - much of it comes from funds raised during the 2022 boom.

In fact, total capital deployed between 2023 and 2025 roughly equals what was raised in 2022 alone. The model that dominated previous cycles - raise capital, launch a token, sell into retail demand - is fading fast.

As VC influence weakens, projects with real users, real revenue, and sustainable tokenomics are the ones surviving. Insider-driven rallies are less common, and fewer chains are launching purely on speculative narratives.

Bitcoin’s Slide Amplifies Token Pain

The broader market downturn has only intensified pressure.

Bitcoin recently dropped to $60,000, dragging sentiment lower and triggering heavy losses across altcoins and newly launched tokens. Since its October 6 all-time high, Bitcoin has fallen approximately 46%, with peak drawdowns exceeding 52% - the largest pullback of the current cycle.

This environment resembles the May 2022 LUNA collapse in terms of market psychology.

On-chain data shows the 7-day EMA of Long-Term Holder SOPR dropping below 1 after remaining above that level for one to two years. When this happens, long-term holders begin realizing losses - a pattern typically associated with deeper bear market phases.

The macro backdrop hasn’t helped either. Weaker economic momentum and geopolitical stress have pressured risk assets across the board, with crypto feeling the brunt of capital flight.

Spot Markets Show Sellers in Control

Market structure data further confirms the bearish tone.

During last summer’s rally, delta volume analysis showed consistent demand and positive spot flows. Since October, that dynamic has reversed sharply.

Spot net volume delta has turned decisively negative across major exchanges.

On Coinbase, monthly spot flows are averaging approximately negative $89 million, while Binance is seeing roughly negative $147 million in monthly average flows. These numbers signal sustained distribution rather than accumulation.

With sellers dominating spot markets and venture capital support fading, token launches face a much harsher environment than in previous cycles.

A Structural Reset for Crypto?

The current landscape suggests a structural shift rather than a temporary correction.

The days of automatic post-TGE pumps driven by venture backing appear to be over. Investors are increasingly scrutinizing fundamentals, token supply structures, and actual product-market fit.

While painful for short-term speculators, this shift may ultimately strengthen the ecosystem. Fewer speculative launches and reduced insider dumping could create a more sustainable market structure in the long run.

For now, however, the numbers are clear: most 2025 token launches are underwater, and crypto’s capital cycle has entered a far more disciplined - and unforgiving - phase.