According to Darius Moukhtarzade, a researcher at 21Shares, the old “token strategy” is over, saying that launching high FDV, low float with governance “meme coins” no longer works.
Moukhtarzade explained that the main reason why token launches fail is the widening “gap between sentiment and fundamentals.” However, fundamentals remain strong amid a growing global user base, increased regulatory clarity, increased institutional participation, and a scalable infrastructure that supports long-term adoption.
On the other hand, market sentiment is extremely negative. This is evidenced by extreme fear levels, repeated failures of recent token generation events (TGEs), and dilution of capital due to explosive growth in the number of tokens.
In addition, a shift in investor focus on AI and a deep-seated distrust of the conduct of past mining projects are further dampening demand. This disconnect means that even fundamentally sound projects struggle to attract liquidity and interest, thus causing token launches to underperform despite macro tailwinds.
New token playbook
To address this, Mouktarzade proposed a framework that focuses on designing tokens so that users can earn more income by holding them rather than selling them right away.
The framework emphasizes that many existing models create a “race to the exit”, with holders competing to be the first to sell, and instead seeking alignment of teams, investors, and users to benefit together as value is built over time.
We also focus on tying the value of a token to real fundamentals such as revenue generation rather than hype, distributing that value directly to holders (e.g. through revenue distribution), and treating ownership as a participation in the growth of the protocol, meaning that long-term holding leads to greater contributions and rewards.
Token release status
The 2025 token launch significantly underperformed. According to the data, approximately 85% of projects are trading below their TGE valuation, meaning nearly four out of five are in the red. Only 15.3% of the tokens are profitable.
According to Moukhtarzade, despite the tailwinds in the industry, there are some serious execution mistakes that are causing token launches to stagnate. Speaking at the EthCC conference, 21Shares researchers explained that the big problem is too high pricing, with projects being launched at inflated FDVs with limited circulating supply. This ends up creating a mismatch between private valuations and what the public market wants to support.
At the same time, founder overconfidence often causes teams to ignore broader market conditions and launch into weak or bearish environments where demand is already constrained. Another critical mistake is underestimating the selling pressure in token generation events, as airdrop recipients, early investors, and liquidity providers tend to profit quickly. This creates more downward pressure.
Also, many projects start too early before achieving product-market fit or sustainable revenue, making the token a substitute rather than a complement to real traction.
