Too many crypto startups are pricing themselves out of venture capital funding by chasing valuations far exceeding their revenues, according to Dan Tapeiro, the CEO of crypto-focused venture capital firm 10T Holdings.

“For some reason, founders and CEOs think that they should be raising capital at 50 to 80 times revenue. So that makes it very hard for us to make a return for our liquidity providers,” Tapeiro said while speaking in a panel discussion at the Consensus conference in Toronto on May 14.

“So a lot of those deals we just pass almost automatically, even businesses that we really like, we won’t invest in if the price isn’t reasonable in the beginning.”

10T Holdings has passed on over 200 companies for similar reasons, including the now-bankrupt FTX, BlockFi and Celsius, Tapeiro said. 

Tapeiro said 10T Holdings looks for crypto projects that have valuations above the $400 million to $500 million range with a valuation-to-revenue ratio of 10x or less.

Host of Crypto In America Eleanor Terrett (left) moderating a discussion with Pantera Capital CEO Dan Morehead (middle) and Dan Tapeiro (right) at the Consensus conference. Source: Cointelegraph

VCs often prefer lower valuations because they offer more upside potential with less risk.

Realistic valuations often make follow-on funding rounds more attractive to investors while also simplifying the exit process.

“Valuation is very important,” Tapeiro said.

Despite Tapeiro’s comments, it appears that crypto startups have had no problem attracting VC funds, as PitchBook reported on May 13 that the total value of crypto venture capital deals rose over 100% quarter-on-quarter to $6 billion in Q1 2025, while the number of deals only increased by 8.8%.

VCs should diversify their bags

Also speaking alongside Tapeiro was Pantera Capital CEO Dan Morehead, who said more VCs should opt to receive a mix of private equity and tokens when investing in crypto startups.

“Each one has their pros and cons, and then they go in these wild pendulum swings where sometimes tokens are really expensive and ventures cheap. Sometimes it’s the opposite.”

Related: Crypto VC deals drop in Q1, but funding more than doubles: PitchBook

“So as an investor, I always advocate people investing in a wide spectrum of tokens and ventures.”

Morehead’s Pantera has taken a more aggressive approach than 10T Holdings over the years and seen considerable success, making a return on 86% of the startups it invested in, with 22 of those reaching unicorn status (companies reaching $1 billion valuations).

Magazine: Danger signs for Bitcoin as retail abandons it to institutions: Sky Wee

Crypto and stock trading platform eToro has seen its share price gain nearly 30% during its debut on the Nasdaq after the company made a last-minute boost to its initial public offering.

Shares in eToro Group Ltd (ETOR) closed May 14 trading at $67, up 28.9% from its initial offering price of $52, according to Yahoo Finance. It brings the company’s market value to over $5.5 billion.

Its stock price shot to a high of $74.26 during the trading day before cooling and has also slightly dipped by 0.7% after the bell to $66.53.

EToro shares shot up and then traded sideways on the company’s debut US offering. Source: Yahoo Finance

The day before, on May 13, eToro boosted its IPO to $620 million after pricing its shares above its previously suggested range of between $46 to $50 each. 

Initially, the firm aimed to raise $500 million by offering 10 million shares, but the company and its backers sold over 11.92 million shares at its IPO, split evenly between eToro and some existing shareholders.

Some BlackRock-managed funds and accounts had signalled interest in buying up to $100 million worth of shares at IPO, eToro said in a May 5 filing with the Securities and Exchange Commission.

Robinhood Markets Inc. (HOOD), a rival to eToro that went public in 2021, saw its share price sink 1.9% to $61.39, with its losses extending by 1.63% after-hours to $60.39, Yahoo Finance shows.

In its regulatory filing, eToro reported its total 2024 crypto revenue, from sources such as trading fees and withdrawals, was $12.1 billion, up from $3.4 billion in 2023. It also expected crypto to account for 37% of its commission from trading activity in the first quarter of 2025, down from 43% in Q1 2024.

The offering was led by Goldman Sachs, Jefferies, UBS Investment Bank and Citigroup.

IPOs rebound after tariff turmoil 

EToro’s public debut marks a rebound for public offerings in the US after many firms put their plans on hold as US President Donald Trump’s sweeping tariffs tanked global markets.

EToro made confidential filings with the SEC in January for a public offering and publicly announced the plans on March 24, but delayed its IPO after Trump’s April 2 “Liberation Day” tariff plans, which put a stop to many in-the-works public offerings.

Related: 8 major crypto firms announce US expansion this year 

The stock and crypto trading house was founded in 2007 and previously bid to go public in 2021 via a merger with a special purpose acquisition company at a valuation of $10 billion.

It canned that plan a year later, in 2022, after stock and crypto markets took a massive hit due to the COVID-19 pandemic and sticky inflation that caused central banks to quickly hike interest rates.

Crypto exchange Kraken is considering going public this year, as is stablecoin issuer Circle, which filed with the SEC on April 1 but paused its plan a day later due to Trump’s tariffs.

Crypto fund manager Bitwise predicted in December that, alongside Kraken and Circle, crypto exchange Figure, crypto bank Anchorage Digital and blockchain analytics firm Chainalysis would also go public this year.

Trade Secrets: Metric signals $250K Bitcoin is ‘best case,’ SOL, HYPE tipped for gains 

Key takeaways:

Google search data and app rankings show retail Bitcoin investor demand near 6-month lows.

Retail investor interest typically peaks 1 week after BTC breaks all-time highs.

Bitcoin (BTC) retail traders are known for entering the market during periods of euphoria, typically after strong monthly gains or a new all-time high. This time is no different, with Bitcoin approaching $104,000 on May 14 while general public interest and retail activity continue to lag.

Analysts estimate that in 2025, retail investors were the largest net sellers of BTC, while institutions were the main buyers. But if historical patterns hold, a surge in retail appetite is likely to occur about one week after Bitcoin surpasses the $109,350 mark.

Source: X/River

According to River’s estimates, individual investors sold a total of 247,000 BTC throughout 2025, equivalent to $23 billion based on the average price during the period. Meanwhile, Michael Saylor’s Strategy accounted for 77% of the 157,000 BTC acquired by businesses that year.

Retail interest for Bitcoin nears 6-month lows

Current search trends for the term “Bitcoin” match levels last seen in June 2024, when BTC was trading around $66,000 after three months of failing to break above $73,000.

Search trends for Bitcoin. Source: Google

Likewise, the Coinbase app now ranks 15th in the US App Store within the finance category—comparable to its 20th-place ranking in June 2024, based on data from The Block.

Coinbase app ranking in US App Store – Finances. Source: TheBlock

If mobile app rankings and Google search trends for “Bitcoin” can serve as proxies for retail interest, demand last peaked on Nov. 15, 2024, when the Coinbase app jumped from the 40th to the 5th position in under two weeks. At the same time, search activity spiked to its highest level in over two years.

Bitcoin/USD performance in November 2024. Source: TradingView / Cointelegraph

The retail excitement coincided with Bitcoin breaking its previous all-time high of $73,757 on Nov. 6, 2024, with excitement peaking nine days later. Although retail traders missed most of the gains from the $67,000 level a month earlier, the bullish trend persisted as Bitcoin surged to $107,000 by mid-December 2024.

Related: Bitcoin bulls aim for new all-time highs by next week as capital inflows soar

Buying Bitcoin near an all-time high is a sub-optimal strategy

A comparable spike in retail demand occurred on March 9, 2024, when the Coinbase app rose to the fourth most downloaded in the US finance category, up from 35th place just two weeks earlier. At the same time, Google search interest for “Bitcoin” hit its highest level in 20 months, roughly six days after Bitcoin surpassed its prior record daily close of $68,000 from November 2021.

The retail interest jump in March 2024 followed a 56% price increase in just 30 days, with BTC climbing from $43,100 to $68,100. In contrast to the November 2024 breakout, the following seven months saw erratic price movements, with Bitcoin struggling to maintain levels above $70,000. Retail traders tend to react to previous all-time highs, but this often means they miss out on most of the upside.

The net outflows from retail investors while Bitcoin trades 5.5% below all-time high reinforce the “Bitcoin” search trends and Coinbase app rankings, supporting the idea that retail demand emerges roughly one week after a previous all-time high is surpassed.

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.