TechFlow news, February 10 — Crypto blogger AB Kuai.Dong pointed out that apart from Bitcoin, the current crypto market generally faces liquidity shortages. A large number of projects are forced to launch tokens at high valuations due to excessively inflated late-stage funding rounds, aiming to avoid disputes from early investors. It is expected that new projects launching this year may suffer declines of over 80%—a $2 billion project could fall to $300 million, and a $700 million project might drop below $100 million. Projects with market caps under $100 million that have not yet opened TGE node sales or public offerings face relatively less pressure. This situation could persist until the summer of 2025.
The analysis indicates that not only retail investors but also institutions and node buyers are adopting short-selling strategies as hedging after new token listings. The crypto VC industry may undergo restructuring from the second half of 2025 through 2026. Influenced by the outsized returns from 2020–2021, massive capital inflows drove investment managers' salaries up to more than $5,000 per month. As five-year funds approach maturity, some funds may fail to raise follow-on capital due to underwhelming investment returns, potentially leading to widespread layoffs and pay cuts across the industry.
