TechFlow news, on February 21, Kaito founder Yu Hu posted on X stating that despite the current controversies surrounding VCs, institutions like Dragonfly remain key industry participants. Taking Dragonfly as an example, its partner Haseeb Qureshi recently publicly supported restricting locked tokens from staking—even if it might harm VC interests. In line with this principle, Kaito has explicitly ruled out staking for locked tokens allocated to investors, foundations, and the team.
Yu Hu revealed that Kaito allocates only 8.3% of its tokens to VCs, significantly lower than the industry standard of 15–30%. He argued that the problem of high fully diluted valuations (FDV) at project launch is not caused by VCs, but rather stems from the traditional "large fundraising – token generation event (TGE)" model. Due to the difficulty in pricing emerging assets, projects have no choice but to rely on private market valuations.
Kaito began in 2022 with an equity-based structure and adopted a lean fundraising strategy. Yu Hu said the project raised only the necessary capital and consistently prioritized cash flow and business model sustainability. This approach has led to strong financial health, with annual net cash flow now exceeding the total amount ever raised.
