In a recent comprehensive analysis of the cryptocurrency landscape, a report by CoinGecko has unveiled disconcerting insights into the fate of digital currencies, revealing that more than 50% of the 24,000 listed on the platform since 2014 have met their demise.
This equates to a staggering 14,039 cryptocurrencies being labeled as “dead” or “failed,” either due to prolonged periods of inactivity or an inherent lack of viability as effective mediums of exchange.
Market Turmoil: 2021 Cryptos Face Demise
The report presents a vivid portrayal of a market fraught with challenges and uncertainties, with a notable correlation between bull runs and project failures. The exuberant surge in prices and speculative fervor during the 2020-2021 boom resulted in the highest number of casualties, as 7,530 coins, representing 53.6% of all defunct coins, succumbed to the subsequent correction.
This period also witnessed the proliferation of meme coins, characterized by a lack of robust technological foundations and clear use cases, leading to their meteoric rise and subsequent downfall.
With 5,724 dead as of January 2024, cryptocurrencies introduced in 2021 have fared the worst. 2021 was the worst year for project launches, with over 70% of cryptocurrencies listed on CoinGecko dying.
The 2022 listed cryptocurrencies come next; 3,520 of them have already crashed, representing a rate of about 60%.
Cryptocurrency 'deaths' by year of launch. Source: Coingecko
In 2023, 289 of the coins listed by CoinGecko went extinct. With over 4,000 coins listed, this reflects a failure rate of less than 10%, a significant decrease from prior years.
Amidst this sobering assessment, a glimmer of hope emerges in the data for 2023. The failure rate for coins launched in this year stands at a significantly lower 10%, with only 289 out of over 4,000 meeting their demise so far.
As of today, the market cap of cryptocurrencies stood at $1.476 trillion. Chart: TradingView.com
Investors Adapt: Favoring Stronger Crypto Projects
This positive trend may be attributed to various factors, including a potential
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Author: Christian Encila
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