DWF Labs says the token market is losing ground to equity capital. In its latest report, the firm said more than 80% of newly issued tokens in 2025 are now trading below their TGE price. At the same time, crypto IPO activity surged, with 2025 fundraising rising 48 times from 2024 to more than $14.6 billion. The report frames this as a clear rotation in capital, away from token issuance and toward public listings and acquisitions.
The report argues that weak token performance is tied to more than price action alone. It points to stretched valuations, thinner liquidity, early profit-taking, airdrop-related selling, and exchange-driven supply overhang as persistent sources of pressure after launch. That combination has made profitable token exposure harder to find and has chipped away at confidence among both retail users and investors.
Tokens and stocks are showing different return profiles
On fundraising structure, the report says IPO and ICO valuations are often not far apart at issuance, but the public float differs. IPO offerings typically sell 12% to 20% of shares to the public, while ICOs usually range from 7% to 12%. World Liberty Finance stood out as an exception, with public sale allocation exceeding 35% of total supply.
Performance patterns also diverge. Tokens tend to reach their peak much faster, often in less than 30 days, and then retrace sharply. Stocks, by contrast, more often climb over a longer period. DWF noted that CRCL and XPL both delivered strong early gains, producing returns of 10x to 25x for investors, yet their post-peak behavior still matched the broader pattern: XPL fell 65% within two weeks of topping out, while CRCL continued to rise in a steadier way.
Why public equities are getting higher valuation premiums
The report says revenue multiples remain higher in equities than in tokens, with stocks trading at roughly 7x to 40x price-to-sales versus 2x to 16x for tokens. One reason is institutional access. Many pools of capital are still limited to securities, which gives listed crypto companies a much larger addressable investor base.
Index inclusion is another factor. DWF highlighted that Coinbase joined the S&P 500 in May 2025, becoming the first crypto company in the index. That move created automatic demand from index-tracking funds and ETFs. The report also points to the wider strategic toolkit available in equity markets, where options, leverage, and deeper counterparties allow institutions to deploy more advanced trading approaches than they typically can in on-chain token markets.
DWF added that price-to-sales alone does not explain the full gap. Regulatory moats, business diversification, shareholder return policies, and sector sentiment all influence valuation. Its examples included Figure, which received SEC approval to issue yield-bearing stablecoin $YLDS; Bullish, whose assets include CoinDesk alongside its regulated exchange business; and Hyperliquid, which directs 97% of revenue to buybacks. According to the report, its assistance fund has repurchased more than 40.5 million HYPE, or over 4% of total supply.
M&A is accelerating around licenses and infrastructure
Beyond IPOs, the report said crypto M&A activity in 2025 reached a five-year high. As the policy environment in the US became more favorable, holding digital assets on corporate balance sheets drew less resistance, and acquisitions became a faster path to licenses, compliance capabilities, and new product lines. DWF said the top three institutional acquisition categories in 2025 accounted for 96% of transaction value, totaling more than $42.5 billion.
Those categories were investment and trading infrastructure, brokerage and exchanges, and stablecoins and payments. The report identified Coinbase, Kraken, and Ripple as the most active acquirers. Coinbase, in particular, was described as pushing toward an “Everything App” model through acquisitions spanning both traditional and newer dApps.
More crypto firms are expected to pursue listings in 2026
Looking ahead, DWF expects more crypto companies to head for public markets in 2026, including Kraken, Consensys, Ledger, Animoca, and Bithumb. Kraken had already filed an S-1 in November 2025 and is expected to list in early 2026. Ledger is targeting a $4 billion valuation, while Bithumb is aiming for a 2026 KOSDAQ listing at a $1 billion valuation.
The report’s central view is not that tokens disappear, but that the market is repricing the risk and reward of tokens versus equity. As fundraising channels, regulation, and liquidity conditions change, capital is moving toward assets with clearer fundamentals, more visible revenue, and more established exit routes.