Can Presale Tokens Go Back to Zero?

Investing in a presale is taking a bet on a project in its earliest stage. Considering the often harsh nature of the crypto market, a good percentage of presale projects fail after launch, while many never even launch at all. When a presale project fails, the token value declines significantly; some may even go to zero. Every project that fails after presale leaves investors underwater as the tokens lose value and investments become losses. So, while presales are a good way to make profits from investing early in promising projects, presale investors are also likely to run into heavy losses if the project fails. Here, we explore the possibility of a project failing after a successful presale and why this can happen.

What happens after a presale?

A project is expected to proceed with development plans or intensify existing programs using funding from the presale. After a presale ends, the following is expected

1. Exchange Listing

Token generation event(TGE)  is usually the next step for a presale project. Token Generation Events are the procedures involved in bringing the project’s native token to life. TGE procedures consist of token minting on the blockchain, creating a liquidity pool on a Dex, and listing on a centralized exchange. Promotional events like airdrops and launch pool events are also part of the TGE.

2. Protocol/project Development

The project is expected to start working on the promised features. For DeFi projects, a functional protocol is expected. This is the same for projects that require a protocol. Projects that do not require a protocol are expected to start developing the core of their operations.

3. Marketing

Post-presale, projects proceed with marketing strategies to grow the project’s presence, attract investors, and scale adoption. Marketing strategies like Digital and SEO marketing, KOL marketing, and community-led crypto marketing are common with crypto projects.

4. Partnerships and collaboration

Projects are also expected to form mutual relationships with external projects or other projects in the same category. Partnerships and collaboration can be on marketing, development, and adoption grounds. For instance, presale projects like Avici and Omnipair have formed partnerships with Visa, Litprotocol and other reputable projects to scale development and adoption

5. Community development and growth

Community is the lifeblood of a thriving web3 project. To this effect, presale projects usually pursue community growth through promotional events that enable them to build a fan base. Incentivized promotional events, token utilities like staking, and airdrops are popular community growth strategies in Web3.

Can a project fail after presale, and why?

The simple answer is Yes. In fact, current data shows that projects are more likely to fail after presale. While this is the same for startups in any sector, the crypto space has unique factors that cause failure of presale projects and fair launches.  Several factors may contribute to a presale project’s failure. The causes may be from the market, investors, or the project itself. Let’s review some of the factors that can cause a project’s token to go back to zero after presale.

Factors that may cause failure after presale

Factors that cause a project’s failure after presale can be grouped according to the lead culprit, as follows;

• Broader Market Forces and Trends

The crypto market is volatile and often harsh. Relatively, it is the most torrid global financial market. As a result, projects struggle to survive, leading to a decline in the value of the token. Presale projects that launch during a bear market face a hard market and therefore have lower chances of survival, compared to projects launched in a bull market. Even in a bull market, several market factors may cause a token to go to zero after presale.

• Investor Psychology and Decision Patterns

Investors are a significant factor in the success of a crypto project. How investors handle their investment can make or break a project. A project whose investors have long-term plans often enjoys more stable price developments. On the other hand, short-term thinking investors may cause erratic price movements that can be detrimental to the project.

Other investor-related factors that can cause project failure include sell-offs from major holders, impatience among investors, and a lack of dedication to the project. The latter is important as dedicated investors become major role players in the community and contribute to the overall project growth while holding their investments for the long term.

• Team Execution and Project Fundamentals

This is perhaps the most relevant factor in this context. How a team manages the project can offer factors discussed previously. Every aspect of the project, from Tokenomics to the functionality of the protocol. The project team must ensure acceptable delivery if the project is to survive after presale. The majority of failure cases for presale projects stem from poor behavior from the team and bad products.

The team is also in charge of navigating the project and pivoting to new utilities in any case. Therefore, teams are also the leading cause of failure for web3 startups that matured into top projects.

Popular case studies

Considering the factors above, let’s take a look at some popular presale projects that failed in 2025 and what caused their tokens to go to zero.

Aquabot (Solana Blockchain)

The Solana project, Aquabot, raised over 21,700 $SOL to build an advanced Telegram trading bot. Hyped by the trendy Telegram Bot narrative, Aquabot attracted thousands of investors who committed significant funds to the presale. The project was also marketed by several crypto KOLs, leading to strong industry presence. However, shortly before TGE, the project team suddenly changed the terms of the presale and vanished with the presale proceeds worth over $4.6 million at the time. The token’s price went back to zero and never launched on any exchange.

CrediX Finance (Sonic Blockchain)

Credix Finance raised $13 million from several presale rounds to build a lending protocol on the Sonic Blockchain. CrediX Finance completed its financing and launched in the classic style in July 2025. However, weeks after the launch, the protocol was reportedly exploited, and $4.5 million worth of assets were stolen from the platform. Audit reports from reputable firms suggest an internal collusion and an exit scam. The project has since halted development. The token value is now back to zero.

URF Memecoin (Solana Blockchain)

The URF memecoin team raised 2,400 SOL (worth over $450,000 at the time) in commitments from presale investors to launch the meme coin token on Solana. Less than 24 hours after the presale was completed in March 2024, the team deactivated their social media accounts and vanished with the presale proceeds. Despite widespread influencer marketing, the URF memecoin never launched, leaving investors with significant losses. The project team reportedly used the presale funds to trade other memecoins.

How to manage your presale investments to avoid heavy losses?

Considering that a presale token could go to zero after launch, here are a few precautions to take while investing in presale projects;

Before investing in a presale project, it is recommended that you properly research the project. Go through available information like the project’s fundamentals, team profile, tokenomics, industry relevance, and community structure. Do not ignore any red flags while researching a project. Consider a shady team and blurry tokenomics as major caveats.

This is a widely known strategy used by presale investors. Capital preservation is an effective way to secure your starting capital. For instance, when you buy a presale from dexs like uniswap or pancakeswap, you can preserve your capital by selling half of your investments once the token’s price doubles in value. This ensures you don’t lose your capital if the token’s value goes to zero. You can develop a capital-preservation strategy that works for you using this system.

• Smart Contract Audit

Review the project’s smart contracts to spot malicious functions. Use smart contract analytics tools to analyze the token contract, vesting contracts, liquidity contract, and the protocol’s contracts. Check liquidity locking contracts for Dex-listed assets and mint functions in token contracts. Read more on smart contract audit for presale projects here.

Develop a risk-managed investment. Understand your risk tolerance level and avoid investing above these levels. Put plainly, do not invest more than you can lose.

Conclusion

Investing in presale, when done well, can make mind-blowing profits for an investor. But it doesn’t come without its own caveats. The crypto space is the wild west, and investors are always at a loss when a project goes south. In the current market structure, it is more important than ever to take precautions while investing in existing and presale projects. We discussed some precautions you can take. However, it is even more important to understand why presale projects fail and position yourself against these factors.