Facing a tougher fundraising environment, some traditional venture firms may eventually shift to direct token investments, moving away from the dual structures common in past investment cycles. At least that’s what Pantera Capital’s investor Mason Nystrom sees coming.
In a July 9 thread on X, Nystrom suggested that more VCs may soon favor tokens over equity, viewing them as a simpler way to capture value, as part of his broader outlook on the state of crypto venture capital.
In the thread, Nystrom noted that the current fundraising environment is tight, with VCs dealing with slower returns to their backers and less capital to put to work. “Across the broader venture landscape, funds are returning less dollars to LPs on the same timeframe of previous vintages,” he wrote, adding that this has left many venture firms with reduced capital to deploy.
Despite that, deal sizes appear to be holding up. According to Messari data shared in the thread, median early-stage deal sizes have rebounded since 2020.
Pre-seed rounds climbed to $2 million in 2025 year-to-date, up from $1.8 million in 2024, while Series A rounds rose to $13.5 million. Series B deals remain flat at $41 million but have recovered from a dip in 2023.
Still, Nystrom expects fewer total deals in 2025. “Slower deal count potentially related to many VCs coming towards end of funds with less dry powder to deploy,” he said. Larger funds are still writing big checks, helping keep overall deployment levels steady with previous years, Nystrom added.
He also pointed to a shift in how capital is being allocated across stages. Since 2024, fundraising has been led by accelerator, launchpad, and seed rounds, with over 1,150 accelerator rounds, more than 680 ICO/launchpad rounds, and 670 seed deals recorded.
Nystrom added that crypto M&A has improved over the past two years, citing deals involving NinjaTrader, Privy, Bridge, Deribit, and Hidden Road as signals of better exit opportunities. That, in his view, could support stronger underwriting for crypto equity moving forward.
Nystrom’s prediction of an investment landscape shift comes as U.S. brokerages race to offer blockchain‑based versions of traditional assets.
In late June, Robinhood announced that it would launch tokens representing over 200 U.S. stocks and ETFs to European users, featuring zero commissions and settlement via its new Layer 2 blockchain through a special‑purpose vehicle.
It soon became clear that these tokens don’t give voting rights or real ownership and are actually derivatives, not shares. OpenAI made it clear that the “OpenAI tokens” are not equity, were created without its permission, and any real transfer of shares would need its approval.
Additionally, blockchain researchers have flagged that Robinhood’s tokenized stocks appear to be stuck inside a “walled garden” and, unlike true decentralized tokens, may not be tradable or freely compatible with other DeFi protocols.