TGE's structural reversal: Is it a "liability" to be liquidated, or an "asset" to be left behind?

For a long time, TGE (Token Generation Event) has been regarded as the "finish line" for crypto. However, after a series of narrative collapses and liquidity depletion, this logic is undergoing a structural reversal.

With regulatory measures in place and the involvement of institutional stakeholders, we may be poised for an even larger wave of TGE (Transfer-to-Government) transactions.

As we approach 2026, we are at a critical juncture in the Crypto market.

In this market context, TGE has become a "coming-of-age ceremony" for each project, one that is both full of anticipation and extremely painful.

In this cycle, when we observe and discuss the significance, quantity, frequency and changes of TGE (Token Generation Event) events, we will find that Crypto is shifting from "valuation discovery" to "value discovery".

2025-2026: A Great Year for TGE and Structural Forecasts

Driven by factors such as regulatory details (such as the US SEC and EU MiCA) and predictions of capital market cycles, 2026 is highly likely to be a "breakout year" for TGE.

From a macro perspective, the increased clarity of regulation and the maturity of institutional products such as ETFs and futures mean that the "macro rhythm" of the TGE event provides a broad timeframe for answering the question, "When is it appropriate for TGE?"

By the end of 2025, we saw many projects focusing on compliant token structures and locking in investors ahead of schedule; several projects also proactively postponed their launches to 2026, suggesting anticipation of a market window in that year. This implies that 2026 may be a peak issuance period, becoming a window for TGE and liquidity release, with the number of TGEs expected to increase by 15%–30% compared to 2025.

However, the surge in TGE numbers does not mean that opportunities abound.

2026 is a "big year for supply". At that time, we will face the unlocking of a large number of old projects, the backlog of delayed TGEs from 2024 to 2025, and the TGEs of possible new narrative projects. In this case, the market's tolerance for "new TGEs" will decrease.

On the one hand, there is the entry of more compliant and institutionalized projects; on the other hand, there is an extreme shortage of liquidity caused by the concentration of new projects on TGE.

From a more meso-level perspective, 2026 may see a dual improvement in both the quantity and quality of TGE, but this "improvement" will be accompanied by dramatic fluctuations.

At the micro level, the nature of TGE has changed. In the past, TGE could be defined as a marketing activity where "benefits outweigh costs":

• Costs: Airdrop pressure, liquidity being partially withdrawn by the CEX, and the foreseeable huge selling pressure in the short term.

• Benefits: Market attention, brand reputation, early adopters.

Currently, market attention is scattered, and the cost and difficulty of building a brand are increasing. Early adopters are not concerned with the product itself, but only with the monetization of tokens, and are heavily reliant on incentives. This means that the costs and benefits of TGE have undergone a structural reversal.

The "Token First, Product Later" approach is gradually becoming ineffective.

Compared to previous cycles, public chains rely on tokens and grand narratives to build distribution advantages, then drive traffic to the ecosystem, and finally complete the application.

This path is failing:

• Narratives require PMF (Product-Market Fit): Liquidity no longer blindly follows narratives but needs to "distinguish truth from falsehood." If a TGE is conducted before PMF is achieved, the token becomes more like an expensive debt that needs to be repaid; before and after the TGE, the team's energy and morale may be overdrawn by internal friction.

• The cold start effect in the same track is gradually being diluted: In the future, token-based cold starts may only be effective for the pioneers in the track (refer to the top public chains that can go through cycles, and Hyperliquild in the Perp DEX track). For the many imitators that follow, attention will be quickly diluted, and liquidity will not increase exponentially.

• The goals of the exchange and the project team are not aligned: the exchange's core business is transaction fees, and its goal is to acquire as many assets as possible; however, if the project team is pursuing long-term development, the two goals are not compatible. TGE was not merely a marketing campaign, but also a stress test for the entire team.

If 2026 is a year of fierce competition, how should project teams view TGE?

• Narrative is consensus, not technical parameters: Don't get too caught up in the technical parameters of TPS or ZK-rollup. You need to answer: What is the community's "consensus," or "religion"? And how does the product solve specific pain points?

• Seed Community: The first 100 real users are more important than the first 100 holders. This can be seen in many technical communities: these people tend to give the most authentic feedback and suggestions on the product and test the product-factor (PMF) at low cost.

• Post-TGE Sustainable Strategies: When most projects fail due to the "sell the hype" effect of the listing, projects need sustainable planning. For example, retain marketing resources and shift from "expectation-driven" to "event-driven"; build a genuine ecosystem through programs like Grants; and provide good depth over the long term, etc.

• Dynamic equilibrium of the economic model: A reasonable unlocking mechanism to reduce initial selling pressure; emulating successful projects in the secondary market, using real revenue generated by the product to repurchase tokens, ensuring that value support does not depend on sentiment.

Future projects need to be carefully planned in areas such as product delivery, token economy design, market timing, community building, differentiated narrative, and compliance transparency in order to stand out during the upcoming TGE intensive period.

Conclusion: Survival Rules for 2026

The failure of some TGEs stems not from product quality or team experience, but from the team's lack of resilience in the face of market scrutiny, competitor competition, and shifting narratives. They were launched hastily without being prepared for open market competition and narrative shifts.

In 2026, the market is very likely to fall into a cycle of "intensive issuance of TGE, value fluctuations and collapse, and market adjustment and reshaping", and those who blindly chase high prices will eventually face the predicament of liquidity depletion.

What needs to be recognized is that tokens are no longer synonymous with growth, and narratives cannot create value out of thin air.

A successful TGE is not measured by listings and volatility, but by whether the team has the ability to pay off its "debts" before the TGE, that is, whether it has found a Product-Market Fit (PMF) that can generate continuous cash flow or real users.

This brutal transformation toward value is essentially a self-purification of the market, and it also creates more fertile ground for long-term thinkers.