New token valuations collapsed across the board in 2025, with infrastructure and gaming projects absorbing the steepest losses, according to market data compiled over the year. The compression marked a stark reversal from the previous cycle's boom, when fresh listings often traded at multiples of their initial pricing.
Where the losses piled up
Infrastructure tokens — the layer that supports blockchains, bridges, and data networks — saw the deepest drawdowns, followed closely by gaming tokens tied to play-to-earn and virtual worlds. Both categories had been the darlings of the 2024 rally, pulling in retail money on promises of adoption and revenue. This year, those same promises turned into sell pressure as liquidity dried up and new listings struggled to hold even their opening prices.
Valuation compression isn't a single event but a rolling repricing. Deals that closed in early 2025 at lofty private rounds later public at a fraction of those marks, and secondary market trading showed consistent discounts. For founders, the math got brutal: a token that once had a $500 million theoretical cap could now be worth a tenth of that by the time it actually hit an exchange.
Infrastructure's hard landing
Infrastructure tokens were the first to slide. These projects often require sustained user growth to justify high valuations, but 2025's user numbers didn't follow the capital. As funding rounds tightened, several infrastructure teams found themselves in a bind — they had raised at peak valuations, but their public launches landed in a market that had already repriced risk. The result was a wave of listings that debuted underwater, with early investors choosing to exit rather than wait.
Gaming's broken promise
Gaming tokens faced a different problem: engagement never matched the hype. The play-to-earn model, which had generated outsized returns in 2024, saw player counts fall off as token prices dropped — and then dropped further because fewer players meant less token burn. The feedback loop worked in reverse. Some gaming projects tried to pivot to free-to-play with token bonuses, but the damage to market confidence was already done. The steepest losses in gaming were concentrated in the titles that had raised the most at the top.
What the compression says
The 2025 compression didn't single out any one cause. It was a mix of overfunding, a crowded field, and a broader market that stopped rewarding speculative multiples. The projects that held up best were the ones with actual user fees and a product already in use, but even those traded at a fraction of their peak. The market's message was blunt: token supply still outnumbers genuine demand, and the repricing reflects it.
That leaves a lingering question for founders and investors alike. After a year of downward valuation, where is the floor? New projects continue to launch, but with lower raises and tighter expectations. The next few quarters will show whether the market has settled into a new normal or if the compression has further to go.
