When the NYSE planned to develop on-chain stocks and 24/7 trading, crypto industry talent realized that the crypto sector had not taken over Wall Street. The multiple acquisitions in 2025 revealed a harsh reality: token holders are neither creditors nor shareholders; they are just fans who purchased high-priced membership cards.
(Background: Circle officially launches IPO: stock ticker CRCL, target valuation $6.7 billion, with JPMorgan, Citibank, and Goldman Sachs as lead underwriters)
(Additional context: The turning point of cryptocurrencies: 2026, the rules of the game are fundamentally changing)

Table of Contents

• The Era of One of Two Choices
• Only People, No Tokens
• The Dividend Dilemma in DeFi
• Rights Mapped, Then What?

On the contrary, Wall Street initially bet on integration, and has gradually transitioned into an era of two-way acquisitions. Crypto companies buy traditional financial licenses, clients, and compliance capabilities; traditional finance buys crypto technology, channels, and innovation. Both sides are infiltrating each other, and boundaries are gradually disappearing. In three to five years, there may be no distinction between crypto companies and traditional financial firms—only financial companies.

This kind of absorption and integration is based on the “Digital Asset Market Clarity Act” (hereinafter referred to as the CLARITY Act), which transforms a wild-growing crypto sector into a form familiar to Wall Street at the institutional level. The first to be reformed is the concept of coin rights, which is unlike the more popular stablecoins.

The Era of One of Two Choices

For a long time, practitioners and investors in the crypto space have been in a state of uneasy anxiety, often subjected to enforcement-style regulation by various government agencies. This tug-of-war not only stifles innovation but also puts investors holding tokens in an awkward position, as they only hold coin rights but no actual rights. Unlike shareholders in traditional markets, token holders lack legally protected rights to information and recourse against insider trading by project teams.

Therefore, when the CLARITY Act was passed with overwhelming support in the US House of Representatives last July, the entire industry had high hopes. The core market demand was very clear: to define whether tokens are digital commodities or securities, ending the years-long jurisdictional battle between the SEC and the CFTC.

The bill stipulates that only assets that are fully decentralized and have no actual controlling party can be recognized as digital commodities under the jurisdiction of the CFTC, similar to gold or soybeans. Any asset with traces of central control or that raises funds through promised yields is classified as a restricted digital asset or security, falling under the strict regulation of the SEC.

This is good news for networks like Bitcoin and Ethereum, which no longer have actual controlling parties. But for most DeFi projects and DAOs, this is almost a disaster.

The bill requires any intermediary involved in digital asset transactions to register and implement strict AML (Anti-Money Laundering) and KYC (Know Your Customer) procedures. For DeFi protocols running on smart contracts, this is an impossible task.

The bill explicitly states that certain decentralized financial activities related to blockchain network maintenance may be exempt, but enforcement rights for anti-fraud and anti-manipulation remain. This is a typical regulatory compromise, allowing behaviors like coding and front-end development to exist, but once it touches trade matching, yield distribution, or intermediary services, it must fall under a more stringent regulatory framework.

Because of this compromise, the CLARITY Act did not truly reassure the industry after summer 2025, as it forced all projects to confront a brutal question—what exactly are you?

If you claim to be a decentralized protocol and comply with the CLARITY Act, your tokens cannot have actual value. If you don’t want to shortchange token holders, you must acknowledge the importance of equity structures and subject tokens to securities law scrutiny.

Only People, No Tokens

This dilemma repeatedly played out in 2025.

In December 2025, a merger and acquisition news sparked very different reactions in Wall Street and the crypto community.

Circle, the world’s second-largest stablecoin issuer, announced the acquisition of the core development team of cross-chain protocol Axelar, Interop Labs. To traditional financial media, this was a standard talent acquisition: Circle gained top cross-chain technology talent to strengthen the circulation of its stablecoin USDC across multi-chain ecosystems. Circle’s valuation thus remained stable, and the founders and early investors of Interop Labs exited happily with cash or Circle shares.

But in the secondary crypto market, this news triggered panic selling.

Investors, upon analyzing the transaction terms, found that Circle’s acquisition was limited to the development team, explicitly excluding AXL tokens, the Axelar network, and the Axelar Foundation. This discovery instantly shattered previous positive expectations. Within hours of the announcement, AXL tokens not only erased all gains from rumors of the acquisition but also plunged further.

For a long time, investors in crypto projects had accepted a narrative that buying tokens was equivalent to investing in the startup itself. With the developers’ efforts, protocol usage would increase, and token value would rise accordingly.

Circle’s acquisition shattered this illusion, legally and practically declaring that the development company (Labs) and the protocol network (Network) are two completely separate entities.

“This is legal robbery,” wrote an investor who held AXL for over two years on social media. But he couldn’t sue anyone, because the legal disclaimers in the prospectus and white paper never promised tokens would have residual claims on the development company.

Looking back at 2025 acquisitions of tokenized crypto projects, these deals usually involved transferring the technical team and underlying infrastructure, but not the token rights, causing significant impact on investors.

In July, Kraken’s Layer 2 network Ink acquired the engineering team of Vertex Protocol and its underlying trading architecture. Soon after, Vertex announced it would shut down, and its token VRTX was abandoned.

In October, Pump.fun acquired the trading terminal Padre. At the same time, the project announced that the PADRE token was invalid and had no future plans.

In November, Coinbase acquired the trading terminal technology built by Tensor Labs, which also did not involve rights to the TNSR token.

At least in these 2025 acquisitions, more and more deals tend to buy only the team and technology, discarding the tokens. This has also angered many crypto investors: “Either give tokens the same value as stocks, or don’t issue tokens at all.”

The Dividend Dilemma in DeFi

If Circle’s tragedy was caused by external acquisitions, then Uniswap and Aave demonstrated internal conflicts that have persisted through different stages of the crypto market.

Aave, long regarded as the king of DeFi lending, fell into a fierce internal battle at the end of 2025 over who should get the money—focused on protocol’s front-end revenue.

Most users do not interact directly with smart contracts on the blockchain but operate through the web interface developed by Aave Labs. In December 2025, the community keenly discovered that Aave Labs quietly modified the front-end code, redirecting high transaction fees generated from token swaps on the website to the Labs’ own corporate account, rather than the treasury of the decentralized autonomous organization (DAO) Aave.

Aave Labs’ reasoning aligns with traditional business logic: the website is ours, the server costs are ours, the compliance risks are ours, and the traffic monetization should belong to the company. But for token holders, this was a betrayal.

“Users came for the Aave decentralized protocol, not for your HTML webpage,” the debate led to a rapid $500 million evaporation in Aave’s market cap.

Although both sides ultimately reached some compromise under intense public pressure, with Labs promising a proposal to share non-protocol revenue with token holders, the fissure could no longer be healed. The protocol may be decentralized, but the traffic entry point remains centralized. Whoever controls the entry controls the actual taxation of the protocol economy.

Meanwhile, Uniswap, the dominant decentralized exchange, also had to choose self-castration for compliance.

Between 2024 and 2025, Uniswap finally advanced the much-anticipated fee switch proposal, aiming to use part of the protocol’s trading fees to buy back and burn UNI tokens, trying to turn the token from a useless governance vote into a deflationary yield-bearing asset.

However, to avoid SEC securities classification, Uniswap had to perform extremely complex structural separation, physically isolating the profit-sharing entity from the development team. They even registered a new entity called DUNA, a decentralized, non-profit, non-legal person organization in Wyoming, attempting to find a legal foothold on the edge of compliance.

On December 26, the final governance vote to activate the fee switch proposal was approved, including burning 100 million UNI and Uniswap Labs shutting down the front-end fee, further focusing on protocol-level development.

Uniswap’s struggles and Aave’s internal war point to an awkward reality: the dividends investors crave are precisely the core basis for securities regulation. Giving tokens value invites SEC penalties; avoiding regulation means tokens must remain without real value.

Rights Mapped, Then What?

When we try to understand the 2025 token rights crisis, it’s helpful to look at more mature capital markets. There, a highly instructive reference exists: the American Depositary Receipts (ADRs) and Variable Interest Entities (VIE) structure of Chinese concept stocks.

If you buy Alibaba (BABA) stock on Nasdaq, seasoned traders will tell you that you are not directly owning the equity of the operating entity in Hangzhou, China. Due to legal restrictions, you hold interests in a Cayman Islands holding company, which controls the Chinese operations through a series of complex agreements.

This sounds very much like some altcoins, which are just a mapped representation, not the actual physical asset.

But the lesson of 2025 tells us there is a significant difference between ADRs and tokens: legal recourse.

Although ADR structures are circuitous, they are built on decades of international commercial law trust, comprehensive auditing systems, and tacit understanding between Wall Street and regulators. Most importantly, ADR holders enjoy residual claims legally. This means that if Alibaba is acquired or privatized, the acquirer must legally exchange your ADRs for cash or equivalent.

In contrast, tokens—especially those initially expected to be governance tokens—exposed their true nature during the 2025 wave of acquisitions: they are neither liabilities on the balance sheet nor equity.

Before the CLARITY Act, this fragile relationship was maintained by community consensus and bullish market faith. Developers implied tokens were stocks, investors pretended to do venture capital. But when the regulatory hammer fell in 2025, everyone realized that under traditional corporate law, token holders are neither creditors nor shareholders; they are more like fans who bought high-priced membership cards.

When assets are tradable, rights can be split. When rights are split, the value tends to concentrate on the side most recognized by law, capable of bearing cash flows, and enforceable in court.

In this sense, the crypto industry in 2025 is not a failure but has been incorporated into financial history. It begins to accept the scrutiny of capital structure, legal texts, and regulatory boundaries like all mature financial markets.

As crypto aligns with traditional finance in an irreversible trend, a sharper question arises: where will the industry’s value flow in the future?

Many believe that integration means victory, but historical experience often shows the opposite: when a new technology is adopted by the old system, it gains scale but may not retain the original promised distribution. The old system’s strength lies in domestication—making innovation controllable, auditable, asset-balance sheetable, and firmly anchoring residual claims within existing rights structures.

Crypto’s compliance may not return value to token holders but is more likely to return value to familiar legal entities—companies, equity, licenses, regulated accounts, and contracts that can be liquidated and enforced in court.

Token rights will continue to exist, just like ADS will continue to exist; they are both rights mappings allowed in financial engineering. But the question is, which layer of mapping are you actually buying?