Throughout 2025, one of the most noticeable trends in the crypto market has been the rapid decline in the performance of the newly listed Binance token. This is especially true for assets with seed tags that indicate early-stage, high-risk assets.
The seed tag segment, once seen as the starting point for the next generation of breakout projects, has instead become one of the worst-performing categories on the exchange, leading people to question the quality of the tokens, investor confidence, and how Binance selects listings.
Combining recent data, community research, and Binance’s own wave of delistings, it appears that Seed Tag tokens are on the verge of collapse as the quality of new projects has declined, listing methods have broken down, and what investors are looking for has completely changed.
That being said, we will dig deeper into why this is happening by looking at the actual numbers, examining specific failing tokens, and discussing what it means for traders going forward.
Related: Binance token tag updated: new risk label for traders
CZ himself acknowledges the problem.
Before coming to any new data or failed tokens, Binance founder Changpeng “CZ” Zhao publicly acknowledged weaknesses in the listing process in February. He considered this somewhat of a bust, pointing out that the listing took place four hours after the announcement, during which time the token price rose on the DEX, and then people sold on the CEX.
CZ’s comments demonstrate the current structural flaws.
- As soon as Binance announces a new token, traders on other platforms (DEXs) start buying it, causing the price to rise significantly before it reaches Binance.
- After seeing Binance go public, traders on major exchanges often buy in the hope that the price will skyrocket, but in reality they end up buying at the highest price.
- Traders who bought early on other platforms can quickly sell on Binance for a quick profit, while retail investors who bought at a high price are left stranded as the value falls.
This pattern has been around for some time, but the situation has worsened this year due to weak market conditions, with almost every new listing set up for a predictable rapid price collapse.
Related: CZ demands Coinbase parity for BNB chainlist due to split opinion
April data confirms that trend.
A few months later, in April, analysts put numbers to what many traders were saying. New tokens listed on Binance are performing very poorly.
According to the data, out of the 27 tokens, only three made a profit: $FORM, $RED, and $LAYER. This means that if you invested $100 in each listing, your $2,700 would be worth approximately $1,500. According to the data, the average loss for all tokens is 44%, with most tokens falling immediately after listing and continuing to fall thereafter.
Ultimately, the analyst concluded that if you buy tokens on Binance, you have zero chance of making a profit and are simply providing exit liquidity for others to cash out.
This pattern of heavy losses continued as the months passed. This is the main reason why investors are becoming more cautious about risky seed tag tokens. Essentially, if a category continues to lose money, trust quickly erodes.
Warning label that became a danger signal
Seed tags were originally introduced as a transparent way to alert users that a token may be volatile and unproven in its early stages. But in 2025, things are starting to look even worse: failure is likely.
A review of the top seed tag failures in 2025 shows that many tokens were delisted or collapsed by 80-90% shortly after launch.
There could be several reasons why these particular tokens were delisted or saw their prices drop significantly. First, most companies did very little daily buying and selling. Some have trading volumes of less than $1 million, which is too low for a major exchange.
Binance regularly cites weak GitHub activity, lack of communication from the team, and a roadmap that doesn’t see updates as major drawbacks. Additionally, some projects had red flags that their networks were unreliable, lacked security, or were at risk of hacking.
Broken tokenomics is another factor, considering that projects like BIO and COOKIE were launched with token unlock schedules and supply structures that guaranteed selling pressure.
Then there are general market changes. In 2025, investors became more selective, prioritizing large-cap stocks and established L2 ecosystems over early-stage experimentation.
Graduation does happen (BONK, EIGEN, PENGU, PEPE, TON, and a few others), but it’s very rare compared to the number of failures, especially considering Binance’s stricter quality standards and many projects simply aren’t strong enough to withstand these reviews.
Related: Removed “seed tag” risk warning from Binance, BONK, PEPE, EigenLayer
Why Binance token sale price is falling
All these issues lead to the core problem of low startup and very poor performance for new seed tag tokens. There are many reasons, but the main ones are:
- weak project – Many new tokens have no real users, are unfinished products or have no clear plan, which reduces demand and no one wants to buy them.
- Too many tokens to unlock at once – Immediately after listing, a large number of tokens will be released for sale, flooding the market and causing the price to fall.
- DEX pre-pumping distorts true market value – Speculative purchases are made on other platforms before Binance launches, creating a price bubble that bursts as soon as trading begins.
- Low liquidity and low trading volume – Since there are fewer buyers and sellers, prices become unstable and tend to fall.
- investor fatigue – Retail traders who have experienced repeated losses are now avoiding early-stage listings, reducing natural buying pressure.
- CEX competition – With dozens of new listings on multiple exchanges, capital is spread thinly and demand for a single token decreases.
- The general market favors established coins – In 2025, most capital will flow into large and established coins like Bitcoin and Ethereum, and new tokens will receive little attention.
- Regulatory concerns – Due to tightening regulations around the world, investors are becoming more wary of risky and unproven tokens.
Simply put, Seed Tag Tokens are falling because the system for launching Seed Tag Tokens is broken, traders have lost confidence, and the projects themselves are often not good enough to succeed.
It is worth noting that in addition to seed tags, Binance also has a monitoring tag system that can flag tokens with increased volatility, low liquidity, or compliance risks. Additionally, starting July 2023, exchanges will require users to take a risk awareness quiz every 90 days before trading tagged assets. This measure is aimed at making users more cautious and allowing Binance to comply with stricter regulations.
These tags often have an immediate impact on price. Tokens like BLZ and CLV fell immediately after receiving the warning label, showing how much traders trust Binance’s risk signals. On the other hand, when seed tags were removed from tokens like BONK and PEPE in mid-2025, we saw more transactions and interest.
Related: Binance Announces Monthly Monitoring Tag Review, Enhances Transparency for At-Risk Tokens
What this means for 2026
As it stands now, seed tags are no longer just warning labels, they are genuine red flags. Cryptocurrency enthusiasts believe that these tokens are highly volatile and prone to failure, making them quick trades with no need for long-term investment.
Only projects with sustained liquidity, active development, transparent communication, and real adoption have a chance of surviving Binance’s increasingly intense review cycle.
Looking ahead, we can expect SeedTag tokens to continue to be highly unpredictable as more SeedTag tokens are removed from the exchange as Binance’s rules become more stringent.
Related: Binance Reduces Illegal Cryptocurrency Activity to Historic Lows, Data Shows
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