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Securitize’s sharp post-listing decline reflects a broader weakness among recently public crypto companies, according to Jeff Dorman, chief investment officer at Arca.

The BlackRock-backed tokenization firm (SECZ), which entered public markets last week, has struggled despite offering exposure to one of the most promising segments of the digital asset industry: the tokenization of real-world assets.

The company’s shares fell as much as 25% during Tuesday’s session before recovering slightly. Since completing its merger with special purpose acquisition company Cantor Equity Partners II, Securitize stock has dropped approximately 40%.

The pullback comes at a time when tokenization is gaining significant attention from traditional finance. Major firms such as BlackRock, Franklin Templeton, and JPMorgan are developing blockchain-based solutions for assets including Treasuries, funds, credit instruments, and equities. Industry forecasts remain bullish, with Citi estimating the tokenized asset market could reach $5.5 trillion by 2030, while BCG and Ripple see potential growth toward $19 trillion by 2033.

Post-SPAC adjustment weighs on shares

Dorman said the decline does not appear to be linked to any major business setback or negative fundamental development at Securitize.

Instead, he pointed to the typical volatility that follows SPAC mergers. After a private company completes a SPAC deal, the original investor base often changes as short-term arbitrage investors exit and long-term shareholders begin evaluating the company’s financial performance and growth prospects.

SPAC structures allow companies to access public markets by merging with publicly traded acquisition vehicles. However, the transition period after the merger can create significant price fluctuations, particularly when trading liquidity is limited or expectations were elevated before the listing.

Crypto IPO fatigue impacts sentiment

Dorman noted that investors have become more cautious due to the disappointing performance of several recent crypto-related public offerings.

Companies such as BitGo, Gemini, and Bullish have experienced steep declines after their market debuts. Circle has held above its IPO price but remains well below its previous highs, while Coinbase continues to trade significantly below its initial market valuation following its 2021 direct listing.

Securitize’s sell-off also coincided with weakness across crypto-related equities. The Nasdaq declined 2% on Tuesday, while Circle shares fell about 5%, BitGo dropped more than 4%, and blockchain company Figure slid nearly 9%.