Diego Martin, chief executive of Yellow Capital, has warned that the current model for launching crypto tokens is structurally flawed and will require underwriting standards equivalent to those provided by traditional investment banks to reach maturity.
Yellow Capital CEO Warns on Token Launch Model as Institutions Reshape Crypto
21 May 2026 - 10:47 CEST
By Matt Neill
The remarks come as institutional capital floods into crypto while the infrastructure for new token issuance stays largely unreformed. This raises the question whether crypto-native firms or traditional finance players will drive the changes needed for the market to function at scale.
Yellow Capital, a market-making and venture firm within the broader Yellow Group, provides liquidity, treasury management and token distribution services to more than 100 blockchain projects across 140 centralized exchanges.
"Everyone's a seller at launch"
In an interview with Sandmark, Martin identified a fundamental coordination failure in current token launches. Founders, market makers, venture capitalists and retail participants all tend to sell at or near listing, with no party structurally incentivized to support long-term token health.
"It seems like everyone at the token launch is a seller, and nobody's structurally supporting the token," he said. "Market makers sell to hedge their delta neutrals, VCs exit at listing, and retail tries to exit as well."
Delta neutral is a common trading strategy where market makers balance their positions so that short-term price moves in the token have minimal impact on their overall portfolio.
He drew a direct parallel to the role of investment banks in traditional equity markets.
"Most tokens don't have their market makers publicly mentioned, they don't have much of their cap table publicly mentioned, and they don't have many of their strategies out there," he said.
"When you launch on Nasdaq, there are certain requirements where you need to disclose all your economic files and have an investment bank that is publicly behind you. That's the stamp of confidence, and that's something we're trying to change."
Yellow Capital has developed TradePoint, a proprietary platform for algorithmic token releases designed to manage sell pressure rather than concentrate it at listing.
AI agents set to reshape trading
Martin expects AI-driven trading agents to materially reshape market structure within 12 to 18 months. Yellow Capital is already running live tests with real capital in limited scenarios.
"They kind of have hands but no eyes," he said of the current generation of AI trading agents, adding that the technology is advancing rapidly and that a significant share of market volume could be agent-driven within that timeframe.
Tokenization requires credible infrastructure
On tokenization – the representation of real-world assets such as equities, bonds or commodities on blockchain networks – Martin said every asset class will eventually require the same liquidity and distribution infrastructure that crypto has built. The current wave of pre-IPO tokens and synthetic equity products, however, often represents speculative liquidity chasing short-term narratives.
Long-term credibility depends on whether crypto-native firms can adopt the structural rigour of TradFi without losing the accessibility and market dynamics that distinguish the space.
"You need Web3 native firms – potentially market makers, other liquidity structuring firms, governance firms – that are able to understand the market dynamics and how liquidity works, and then adopt that more serious infrastructure and wrapping of products that TradFi brings," he said.
"That's essentially the next move for the token economy to mature."
