Crypto IPOs Drag Down 2025's Public Market Returns
Last year's IPO market underperformed the S&P 500, with crypto and AI debuts taking much of the blame for weak returns.
Scout Team
The market's doing something interesting today, and it's not what crypto investors want to hear. Turns out, betting on IPOs in 2025 was a losing game compared to just buying an index fund. Yeah, you read that right.
Here's what happened: crypto and AI companies that went public last year basically tanked the overall IPO performance. While the S&P 500 cruised along doing its thing, investors who jumped into new public offerings got burned. And honestly? The crypto debuts were some of the worst performers of the bunch.
This isn't entirely shocking if you've been watching the space. We saw several high-profile crypto exchanges and infrastructure companies rush to market in 2025, riding what they thought was renewed institutional interest. But reality hit different. Many of these stocks are now trading well below their IPO prices, with some down 40% or more.
The AI story isn't much better. Remember all that hype around generative AI companies going public? Well, public market investors weren't as excited as the venture capitalists who funded them. The combination of sky-high valuations and actual revenue that didn't match the promises created a perfect storm for disappointment.
So what's the takeaway? Sometimes boring really is better. While everyone was chasing the next big crypto or AI moonshot through IPOs, the regular old S&P 500 index just kept grinding higher. Not exactly the sexiest investment story, but your portfolio would've thanked you.