Milk Mocha's $HUGS Token Presale and Its Implications in a Bear Market Crypto Landscape

In the shadow of the 2025 crypto bear market, traditional financial sector volatility has become a defining backdrop for investor behavior. Companies like Fangdd Network Group Ltd., which issued a $34.32 million convertible note in October 2025, exemplify the risks and uncertainties permeating capital markets, according to a QuiverQuant report. This unsecured, interest-free note-convertible into Class A shares at $1.0409-has raised concerns about equity dilution and corporate governance, particularly as Fangdd agreed to issue additional Class C shares to its CEO's affiliated entity, per a StockTitan announcement. Such moves, while common in traditional finance, underscore a broader narrative of capital-seeking behavior and shareholder risk, which crypto investors are increasingly scrutinizing.

Meanwhile, the crypto market is witnessing a divergence in strategy. Projects like Milk Mocha's $HUGS token presale are leveraging deflationary mechanics and utility-driven ecosystems to attract capital in a bearish environment. The $HUGS presale, structured across 40 stages with prices starting at $0.0002 and rising weekly, incorporates a burn mechanism for unsold tokens, creating scarcity and aligning long-term incentives, according to a CryptoNewsLand article. Early-stage participants, particularly those on the rapidly filling whitelist, gain access to the lowest price per token, exclusive updates, and potential staking rewards, as noted in a Blockonomi article. This contrasts sharply with Fangdd's equity-centric approach, highlighting a shift in investor priorities toward projects that prioritize scarcity and utility over traditional capital-raising tools.

The bear market has amplified demand for projects that address real-world use cases. For instance, Digitap ($TAP) and BlockchainFX (BFX) have gained traction by bridging traditional finance and crypto, offering hybrid platforms for asset management and trading, per a CryptoNinjas roundup. Similarly, Milk Mocha's $HUGS token is not merely a speculative asset but a governance and utility token powering a multifaceted ecosystem, including charity initiatives, merchandise, and NFT integrations, as detailed in a FinanceFeeds report. This alignment with tangible applications resonates with investors wary of the speculative excesses that often accompany market cycles.

Fangdd's convertible note, however, serves as a cautionary tale. While the company's actions are legally compliant and exempt from U.S. securities registration, as noted in the QuiverQuant report, the potential for dilution and governance concentration could erode trust-a critical asset in crypto markets. In contrast, $HUGS's transparent presale structure, with its deflationary model and community-driven incentives, mitigates such risks. The token's 40-stage rollout ensures gradual capital inflow while the burn mechanism reduces supply over time, countering the inflationary pressures often seen in traditional equity offerings, as the CryptoNewsLand article observed.

Investor behavior in 2025 reflects a growing preference for projects that balance innovation with risk management. For example, the record $19 billion liquidation event triggered by geopolitical tensions in October 2025 disproportionately impacted crypto-native investors in perpetual futures markets, according to a Bybit x Block Scholes report. This volatility has pushed investors toward assets with clear utility and deflationary safeguards, such as $HUGS. Meanwhile, traditional finance's reliance on convertible notes and equity dilution-while effective in stable markets-risks alienating a crypto audience conditioned to prioritize scarcity and decentralization, according to an Odaily analysis.

As the bear market persists, the strategic positioning of new crypto assets will hinge on their ability to navigate traditional finance's turbulence. Milk Mocha's $HUGS token, with its deflationary design and ecosystem-driven utility, represents a compelling counterpoint to conventional capital-raising strategies. While Fangdd's $34.3M convertible note underscores the fragility of equity-centric models, $HUGS's presale demonstrates how crypto projects can engineer resilience through scarcity, community engagement, and real-world applications.