Gemini has lost 89% of its value since listing on Nasdaq last September - and is now being sued by its own shareholders. BitGo has tumbled 77% and Bullish 71%, while the lineup of IPO hopefuls behind them - Kraken, Grayscale, Consensys, and Ledger - has frozen entirely. The wave of crypto IPOs once hailed as the “industry’s graduation to capital markets” lasted barely a year before wiping out most of the capital entrusted to it.
Not All Crashes Are Equal - There Is a Clear Pattern
As it turns out, the market is not dumping crypto stocks indiscriminately, but evaluating them along a single key axis: how sustainable their revenues are. Stablecoin issuer Circle is down just 6% because its revenue stems from interest on dollar reserves that flow steadily regardless of market sentiment - even benefiting from high interest rates that hammered others. Figure, with its blockchain-based lending business, is down 14%. In the middle, eToro dropped 42% as its retail brokerage economics deteriorated with retail investors fleeing the market. Meanwhile, Bullish, BitGo, and Gemini - whose revenues rely entirely on trading volume and crypto asset prices - suffered the steepest drops because investors valued them using the 2025 cycle peak as a flawed benchmark.
Why Crypto Investors Are Actually Shunning Crypto Stocks
The greatest irony: the investors who understand crypto best are the ones avoiding these stocks the most. Those looking for Bitcoin exposure can simply buy an ETF instead of exchange equity; those wanting exposure to exchange economics can hold tokens like HYPE, which directs 97% of platform fees to buybacks - a mechanism that pushed it near all-time highs during the very same months crypto exchange stocks lost three-quarters of their value. The industry went public in an equity “wrapper” just as its own technology rendered that wrapper obsolete, leaving only generalist capital - the most prone to panic and the quickest to exit - to buy the IPOs.
Sourced from crypto.news.
Disclaimer: This article is for informational and educational purposes only, not financial advice. Cryptocurrency assets are highly volatile and carry significant risk. Always do your own research (DYOR) and never invest more than you can afford to lose.
