Most crypto tokens have been in a bear market since December 2024, Pantera

The cryptocurrency market’s troubles run deeper than many investors realize. Most digital tokens have been stuck in a severe downturn that started over a year ago, according to venture capital firm Pantera Capital.

In its 2026 outlook, the firm shows that tokens outside of bitcoin have been falling steadily since December 2024. Poor value retention, declining network activity, and reduced retail investor interest have all weighed on prices.

Market plunge triggers capitulation-level selling

Pantera says the total market value of cryptocurrencies, excluding bitcoin, ethereum, and stablecoins, plunged roughly 44% from its high point in late 2024 through year-end 2025. That sharp drop pushed investor sentiment and borrowing to levels typically seen during capitulation phases, when desperate holders sell off their positions to avoid bigger losses.

Bitcoin managed to end last year with only a small decline. But the rest of the market? It faced a prolonged and continuing slide.

The performance gap was stark. Bitcoin closed 2025 down about 6%, ethereum fell around 11%, and SOL dropped 34%. The wider group of tokens, not counting BTC, ETH, and SOL, tumbled nearly 60%. The typical token lost approximately 79% of its value. Pantera called 2025 an unusually concentrated market where very few tokens posted gains.

Market fundamentals weren’t really driving things, the firm noted. Instead, policy changes, tariff concerns, and shifting risk tolerance drove wild price swings throughout the year. October brought a massive wave of forced selling that wiped out over $20 billion in positions, bigger than the Terra/Luna and FTX crashes.

Structural problems compound token weakness

There are deeper problems too. Pantera pointed to ongoing uncertainty about how tokens create value. Governance tokens frequently lack clear legal rights to cash flows and leftover value that stock shareholders typically receive.

That situation helped digital asset stocks perform better than tokens during the year. Network fundamentals weakened in the latter half of 2025, drops in transaction fees, application earnings, and active users, even as stablecoin supply kept growing.

The firm observed that the current downturn’s length now matches previous crypto bear markets. That could create better conditions for 2026 if fundamentals improve and the market expands beyond bitcoin.

Rather than predicting specific prices, Pantera describes 2026 as a year when investment money will shift. Bitcoin, stablecoin infrastructure, and equity-linked crypto investments stand to gain first if conditions stabilize and investors become more comfortable with risk.

Last month, Pantera’s Paul Veradittakit said the firm anticipates 2026 will be shaped by institutional adoption. Growth will center on real world asset tokenization, AI-powered blockchain security, bank-issued stablecoins, prediction market consolidation, and increased crypto company public offerings. Not a broad comeback in speculative token trading.

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