- In the 2021 bull market, the number of project failures was higher.
- Things improved in 2023, with only about 10% of all listed cryptos failing.
Cryptocurrencies have evolved over the years from a lesser-known jargon to a popular financial investment. With the adoption of spot exchange-traded funds (ETFs) pegged to the spot prices of the world’s largest crypto asset Bitcoin [BTC]Mainstream adoption was expected to accelerate further.
But do you know that most cryptocurrencies in general eventually fail?
More than half of the cryptos have fallen into oblivion
This is evident from a study by cryptomarket tracker Coin geckoOf the more than 24,000 cryptocurrencies listed on the platform since 2014, more than 50% have died.
Source: CoinGecko
The report found that most failed crypto projects were launched during the 2020-2021 bull market.
This is understandable considering that the exponential growth of the market at that time led to the rise of many cryptos, which ultimately failed to stand the test of time.
As many as 7,530 cryptocurrencies launched during the aforementioned period have now been defunct, representing more than half of all dead cryptocurrencies.
It also came to light that the crypto projects launched during the previous two bull markets of 2021 and 2017 had an astonishing 70% failure rate.
This was followed by cryptocurrencies listed in 2022, of which almost 60% eventually closed their doors.
Coingecko listed a “failed” or “dead” cryptocurrency as one that showed no trading activity in the past 30 days. This infamous category also included projects that were proven to be scams or that the founding team themselves requested to be deactivated.
But if this gloomy news has made you reconsider your crypto investments, hold your horses!
2023 marked a sharp decline
Over the past year, things have improved significantly, with only about 10% of all listed cryptos failing. The steep decline indicated market maturity, with more serious initiatives gaining ground in place of shitcoins.
As more investments flow in due to TradFi exposure, one can only expect the failure rate to continue to decline.
At the time of writing, CoinGecko tracks more than 12,000 cryptos spread across 972 exchanges.
