- 85% of tokens launched in 2025 now trade below launch price, even VC-backed projects fail.
- Last quarter fundraising hit just 12% of Q2 2022, with new fund launches at a five-year low.
- VCs mostly deploy old capital, while projects with real users and revenue gain more attention.
According to crypto analyst Edgy of The DeFi Edge, 85% of token launches in 2025 are already trading below their launch price.
VC-backed projects, long seen as safer bets, are barely breaking even. Some are deep in the red. The old playbook of raising funds, launching a token, and offloading to retail buyers is losing its grip.
Crypto VC Fundraising Has Collapsed Since Its 2022 Peak
The data paints a sharp picture of decline. In Q2 2022, crypto venture capitalists raised nearly $17 billion in a single quarter. Over 80 new funds launched in that period alone. Limited partners poured money into anything pitched with the word “crypto.”
That era is now firmly in the rearview mirror. According to Galaxy Research data shared by The DeFi Edge, VC returns have been falling since 2022. New fund formation just hit a five-year low. Last quarter’s fundraising was only 12% of Q2 2022 levels.
The $8.5 billion deployed last quarter may look impressive at first glance. It was up 84% quarter-over-quarter. But The DeFi Edge points out this is not fresh capital at work.
VCs are spending money raised back in 2022. The total capital deployed from 2023 to 2025 is roughly equal to what the industry raised in that one record quarter alone.
85% of token launches in 2025 are underwater.
VC backed deals barely break even and some are deep in the red.
Back in the day having a “Top VC” on the cap table was a huge catalyst, but not anymore. This chart from Galaxy Research tells the story.
In Q2 2022, crypto VCs… pic.twitter.com/HAdlXAYccA
— Edgy – The DeFi Edge 🗡️ (@thedefiedge) February 17, 2026
What the Fall of VC Power Means for Crypto Token Launches
For years, landing a top VC on the cap table was a powerful signal. It drew attention, drove up prices, and gave projects instant credibility. That era is changing fast. Having a big-name investor no longer moves the market the way it once did.
The DeFi Edge notes that as VC influence fades, something else tends to take its place. Projects with real users and real revenue start to stand out. Fairer launch models gain traction. Insider dumps become less of a dominant force in the market.
The shift is already visible across the crypto landscape. Community-driven ecosystems are drawing more engagement. ‘
Builders focused on product over the next funding round are finding an audience. The model that relied on VC prestige to push tokens into retail hands is clearly not working as well anymore.
The Galaxy Research chart shared by The DeFi Edge tells the story clearly.
Fundraising peaked and then cratered. Returns followed. The dynamics that once made a VC stamp feel like a guarantee of success have quietly eroded, leaving 2025 token investors to deal with the fallout.
Disclaimer: The information on this page may come from third parties and does not represent the views or opinions of Gate. The content displayed on this page is for reference only and does not constitute any financial, investment, or legal advice. Gate does not guarantee the accuracy or completeness of the information and shall not be liable for any losses arising from the use of this information. Virtual asset investments carry high risks and are subject to significant price volatility. You may lose all of your invested principal. Please fully understand the relevant risks and make prudent decisions based on your own financial situation and risk tolerance. For details, please refer to
Disclaimer.
Related Articles
Bitcoin Falls Below $69,000, Derivatives Market Shifts to Defense, Downside Risks Intensify
10x Research analysis points out that Bitcoin has broken below $69,000, marking a shift in market structure. Traders have significantly adjusted positions, with increased futures liquidations and negative funding rates. Options capital flows are moving toward downside protection, signaling hedging demand against downside risks. Meanwhile, market expectations regarding rate increases are diverging from the Federal Reserve's rate-cutting guidance, which could impact risk asset performance.
GateNews22m ago
Hyperliquid Surpasses CME Pricing Status, On-Chain Commodity Trading Volume Breaks $173.4 Billion
Hyperliquid's HIP-3 board has achieved billion in trading volume over the past 7 days, primarily driven by WTI crude oil contracts, demonstrating strong market activity. Powered by the US-Iran conflict, the platform's 24/7 trading functionality has made it an important source for price discovery, replacing traditional exchanges. As Hyperliquid adapts to CFTC regulations, it aims to maintain financial neutrality, but how to balance compliance requirements with the advantages of decentralized trading remains a challenge.
MarketWhisper48m ago
Gate Daily Report (March 23): MicroStrategy Releases Bitcoin Buy Signal; MajiDaBro's ETH Liquidation Incurs Losses of 30.35 Million
Bitcoin has continued to decline to around $67,950, with MicroStrategy founder Michael Saylor reiterating a buy-the-dip strategy. Huang Licheng's highly leveraged ETH position was completely liquidated, with losses exceeding $30.35 million. Fidelity has called on the US SEC to improve its regulatory framework for crypto assets. US stocks have broadly declined, and market sentiment remains cautious.
MarketWhisper1h ago
Scaramucci: Bitcoin Halving Cycle Remains Intact, Q4 Bull Market About to Resume
SkyBridge Investment Company partner Scaramucci stated that Bitcoin's four-year halving cycle remains effective, with the current bear market representing a normal pullback, predicting another bull market for Bitcoin in 2026. The market's collective belief is self-fulfilling, and pessimistic sentiment similar to historical patterns could present entry opportunities. Although institutional investors influence cyclical volatility, the fundamental nature of the halving cycle has not changed.
MarketWhisper1h ago
Why Did Bitcoin Fall Today? Trump's 48-Hour Ultimatum Triggers Market Panic
Bitcoin declined to $67,979.57 today, primarily affected by US-Iran tensions, higher-than-expected US PPI data, and whale short-selling activity. Global markets face stagflation pressure, with $70,000 serving as a key support level. If this level is breached, prices could potentially decline to $68,000.
MarketWhisper1h ago
Cryptocurrency Fear and Greed Index Falls to 8 Today, Market Extreme Panic Sentiment Deepens
Gate News reported that on March 23rd, according to Alternative.me data, today's cryptocurrency fear and greed index fell to 8, declining further from yesterday's 10. The index indicates the market is currently in a state of extreme panic, with panic sentiment continuing to deepen.
GateNews2h ago
