Crypto Accelerator Leader Imran Khan Calls for Fund Returns as Over 40% of Projects Fall Below Initial Valuation

Imran Khan, a prominent figure in the Web3 accelerator space and a core contributor at Alliance DAO, recently sparked discussion on social media regarding the challenging realities faced by crypto founders. In a candid tweet, Khan asserted the importance for founders to acknowledge setbacks and return unutilized funds to investors, highlighting a critical aspect of accountability in the rapidly evolving digital asset landscape. His statement underscores the increasing pressure on projects to deliver tangible value amidst shifting market dynamics.

Khan's tweet, posted on September 3, 2025, directly addressed the inherent volatility and transparency of the blockchain environment. He stated, > "It’s okay for crypto founders to admit defeat and return funds raised back to the market. And imo it doesn’t happen nearly enough." He further elaborated that "Onchain is a double edged sword it speed can either accelerate a startup or expose its weaknesses." This perspective suggests that the very nature of on-chain operations, while offering rapid growth potential, also relentlessly exposes flaws, leading to situations where projects may need to pivot or cease operations.

The sentiment expressed by Khan is supported by recent market analysis, which indicates a significant number of crypto projects struggle to meet initial expectations. According to a report by ArkStream Capital, over 70% of crypto investments remain in the "paper stage," failing to reach public market circulation, and a substantial 42.85% of projects currently hold valuations below their private placement prices. This data reflects a harsh reality where many ventures do not progress beyond early development or fail to retain their initial investor-backed value.

The "speed of onchain" mentioned by Khan can indeed be overwhelming, with market attention and immediate data availability amplifying both successes and failures. A bad launch day can derail a product's trajectory, and constant scrutiny means that projects lacking product-market fit or strong execution are quickly identified. In such scenarios, Khan argues, > "the right move is to return the money," emphasizing that holding out only delays the inevitable and holds backers hostage.

The current market environment, characterized by a shift from speculative growth to a focus on fundamental value and practical applications, contributes to these outcomes. Venture Capital firms are increasingly prioritizing projects with clear business models and sustainable revenue, moving away from concept-driven narratives that dominated previous cycles. This renewed emphasis on intrinsic value means that projects unable to demonstrate tangible progress are less likely to secure continued funding or market support.

Khan concludes his message with a call for swift action and realism: > "The faster you accept reality, the faster you can reset and focus on what’s next." His advocacy for founders to transparently acknowledge failure and return funds highlights a maturing industry seeking greater accountability and resilience. This approach aims to foster a healthier ecosystem where resources are reallocated efficiently, allowing founders to learn, reset, and contribute to future, more viable innovations.