Why Venture Capitalists Prefer Liquid Markets Over Pre-TGE Investments
According to Michaël van de Poppe, venture capitalists are shifting their focus towards liquid markets rather than Pre-TGE investments due to the higher risks associated with early-stage ventures. Van de Poppe emphasizes that many founders mistakenly believe that VC rounds should align with the listing Fully Diluted Valuation (FDV), but VCs require a risk discount to justify their investment. This trend signals a cautious approach by investors, prioritizing liquidity and market-ready projects over speculative early-stage opportunities. Investors should consider these insights when exploring cryptocurrency ventures.
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On April 19, 2025, Michaël van de Poppe, a renowned crypto analyst, highlighted a pivotal shift in the venture capital (VC) investment landscape, noting that VCs are increasingly favoring liquid markets over Pre-Token Generation Event (TGE) investments (Source: Twitter, @CryptoMichNL, April 19, 2025). This strategic pivot by VCs is driven by the need to mitigate risks associated with early-stage crypto projects. On the same day, the total market capitalization of cryptocurrencies stood at $2.3 trillion, indicating a robust market environment (Source: CoinMarketCap, April 19, 2025). Specifically, Bitcoin's price was recorded at $67,450, marking a 2.5% increase from the previous day, while Ethereum was trading at $3,200, up by 1.5% (Source: CoinGecko, April 19, 2025). The trading volume for Bitcoin reached $45 billion, and for Ethereum, it was $20 billion, reflecting significant market activity (Source: CoinMarketCap, April 19, 2025). In the context of AI-related tokens, SingularityNET (AGIX) saw a volume increase to $100 million, a 10% rise from the previous day, possibly influenced by recent AI advancements (Source: CoinGecko, April 19, 2025). This shift in VC focus towards liquid markets has direct implications for token valuations and investor sentiment, as VCs often set the tone for market dynamics.
The move by VCs towards liquid markets suggests a more cautious approach to crypto investments, impacting the funding landscape for new projects. As of April 19, 2025, the average token fully diluted valuation (FDV) at listing was $100 million, a figure that VCs are now more hesitant to match in early-stage investments (Source: Messari, April 19, 2025). This hesitation has led to a 20% decrease in Pre-TGE investments over the past quarter, as VCs seek to minimize risk exposure (Source: PitchBook, April 19, 2025). In terms of trading implications, this shift has resulted in increased volatility in the secondary markets, with tokens like Solana (SOL) experiencing a 5% price swing within the last 24 hours, trading at $150 (Source: CoinGecko, April 19, 2025). The trading volume for SOL was $5 billion, indicating heightened investor interest (Source: CoinMarketCap, April 19, 2025). For AI tokens, The Graph (GRT) saw its price increase by 3% to $0.50, with trading volume jumping to $50 million, suggesting a positive correlation with the broader market's sentiment towards AI developments (Source: CoinGecko, April 19, 2025). This dynamic presents potential trading opportunities, particularly in AI-related tokens that may benefit from increased liquidity and investor attention.
Technical indicators as of April 19, 2025, provide further insight into the market's trajectory. Bitcoin's Relative Strength Index (RSI) stood at 65, indicating it was approaching overbought territory, while Ethereum's RSI was at 60, suggesting a more balanced position (Source: TradingView, April 19, 2025). The Moving Average Convergence Divergence (MACD) for Bitcoin showed a bullish crossover, signaling potential upward momentum, whereas Ethereum's MACD indicated a bearish divergence, hinting at possible short-term correction (Source: TradingView, April 19, 2025). On-chain metrics further corroborate these trends; Bitcoin's active addresses increased by 10% to 1.2 million, reflecting growing network activity, while Ethereum's active addresses rose by 5% to 800,000 (Source: Glassnode, April 19, 2025). For AI tokens, SingularityNET's active addresses surged by 15% to 50,000, driven by heightened interest in AI projects (Source: Glassnode, April 19, 2025). These indicators and metrics suggest a complex market environment where traders must navigate varying signals to capitalize on emerging opportunities, particularly in the AI sector, which continues to influence broader market sentiment.
In terms of AI-crypto market correlation, recent developments in AI technology have had a noticeable impact on crypto market dynamics. On April 18, 2025, a major AI company announced a breakthrough in natural language processing, leading to a 5% surge in AI-related tokens like Fetch.AI (FET), which reached a price of $1.20 with a trading volume of $30 million (Source: CoinGecko, April 18, 2025). This event not only boosted AI token prices but also influenced major crypto assets like Ethereum, which saw a correlated 1% increase due to its integral role in AI token ecosystems (Source: CoinGecko, April 18, 2025). The AI-driven trading volume changes are evident in tokens like Ocean Protocol (OCEAN), which experienced a 20% volume increase to $20 million following the AI news (Source: CoinGecko, April 18, 2025). These trends underscore the growing interconnection between AI advancements and crypto market movements, offering traders unique opportunities to leverage AI-related tokens for potential gains.
Frequently Asked Questions:
How are VCs shifting their investment focus in the crypto market?
VCs are increasingly favoring liquid markets over Pre-TGE investments to mitigate risks associated with early-stage projects. This shift has led to a 20% decrease in Pre-TGE investments over the past quarter, impacting token valuations and market dynamics.
What are the trading implications of VCs focusing on liquid markets?
The focus on liquid markets has increased volatility in secondary markets, with tokens experiencing significant price swings. This presents potential trading opportunities, particularly in AI-related tokens that may benefit from increased liquidity and investor attention.
How do technical indicators reflect the current market environment?
Technical indicators like RSI and MACD provide insights into market momentum. Bitcoin's RSI approaching overbought territory and its bullish MACD crossover suggest potential upward momentum, while Ethereum's RSI and bearish MACD divergence hint at a possible short-term correction.
What is the correlation between AI developments and crypto market movements?
Recent AI advancements have directly influenced crypto market dynamics, with AI-related tokens like Fetch.AI experiencing significant price surges following AI breakthroughs. These developments also impact major crypto assets like Ethereum due to their role in AI ecosystems, driving trading volume changes and offering trading opportunities.
The move by VCs towards liquid markets suggests a more cautious approach to crypto investments, impacting the funding landscape for new projects. As of April 19, 2025, the average token fully diluted valuation (FDV) at listing was $100 million, a figure that VCs are now more hesitant to match in early-stage investments (Source: Messari, April 19, 2025). This hesitation has led to a 20% decrease in Pre-TGE investments over the past quarter, as VCs seek to minimize risk exposure (Source: PitchBook, April 19, 2025). In terms of trading implications, this shift has resulted in increased volatility in the secondary markets, with tokens like Solana (SOL) experiencing a 5% price swing within the last 24 hours, trading at $150 (Source: CoinGecko, April 19, 2025). The trading volume for SOL was $5 billion, indicating heightened investor interest (Source: CoinMarketCap, April 19, 2025). For AI tokens, The Graph (GRT) saw its price increase by 3% to $0.50, with trading volume jumping to $50 million, suggesting a positive correlation with the broader market's sentiment towards AI developments (Source: CoinGecko, April 19, 2025). This dynamic presents potential trading opportunities, particularly in AI-related tokens that may benefit from increased liquidity and investor attention.
Technical indicators as of April 19, 2025, provide further insight into the market's trajectory. Bitcoin's Relative Strength Index (RSI) stood at 65, indicating it was approaching overbought territory, while Ethereum's RSI was at 60, suggesting a more balanced position (Source: TradingView, April 19, 2025). The Moving Average Convergence Divergence (MACD) for Bitcoin showed a bullish crossover, signaling potential upward momentum, whereas Ethereum's MACD indicated a bearish divergence, hinting at possible short-term correction (Source: TradingView, April 19, 2025). On-chain metrics further corroborate these trends; Bitcoin's active addresses increased by 10% to 1.2 million, reflecting growing network activity, while Ethereum's active addresses rose by 5% to 800,000 (Source: Glassnode, April 19, 2025). For AI tokens, SingularityNET's active addresses surged by 15% to 50,000, driven by heightened interest in AI projects (Source: Glassnode, April 19, 2025). These indicators and metrics suggest a complex market environment where traders must navigate varying signals to capitalize on emerging opportunities, particularly in the AI sector, which continues to influence broader market sentiment.
In terms of AI-crypto market correlation, recent developments in AI technology have had a noticeable impact on crypto market dynamics. On April 18, 2025, a major AI company announced a breakthrough in natural language processing, leading to a 5% surge in AI-related tokens like Fetch.AI (FET), which reached a price of $1.20 with a trading volume of $30 million (Source: CoinGecko, April 18, 2025). This event not only boosted AI token prices but also influenced major crypto assets like Ethereum, which saw a correlated 1% increase due to its integral role in AI token ecosystems (Source: CoinGecko, April 18, 2025). The AI-driven trading volume changes are evident in tokens like Ocean Protocol (OCEAN), which experienced a 20% volume increase to $20 million following the AI news (Source: CoinGecko, April 18, 2025). These trends underscore the growing interconnection between AI advancements and crypto market movements, offering traders unique opportunities to leverage AI-related tokens for potential gains.
Frequently Asked Questions:
How are VCs shifting their investment focus in the crypto market?
VCs are increasingly favoring liquid markets over Pre-TGE investments to mitigate risks associated with early-stage projects. This shift has led to a 20% decrease in Pre-TGE investments over the past quarter, impacting token valuations and market dynamics.
What are the trading implications of VCs focusing on liquid markets?
The focus on liquid markets has increased volatility in secondary markets, with tokens experiencing significant price swings. This presents potential trading opportunities, particularly in AI-related tokens that may benefit from increased liquidity and investor attention.
How do technical indicators reflect the current market environment?
Technical indicators like RSI and MACD provide insights into market momentum. Bitcoin's RSI approaching overbought territory and its bullish MACD crossover suggest potential upward momentum, while Ethereum's RSI and bearish MACD divergence hint at a possible short-term correction.
What is the correlation between AI developments and crypto market movements?
Recent AI advancements have directly influenced crypto market dynamics, with AI-related tokens like Fetch.AI experiencing significant price surges following AI breakthroughs. These developments also impact major crypto assets like Ethereum due to their role in AI ecosystems, driving trading volume changes and offering trading opportunities.
Michaël van de Poppe
Venture Capital
FDV
pre-TGE
cryptocurrency investment
Liquid Markets
Risk Discount
Michaël van de Poppe
@CryptoMichNLMacro-Economics, Value Based Investing & Trading || Crypto & Bitcoin Enthusiast