Do you know that more than 50% of cryptocurrencies have failed? Cryptocurrencies that launched during the 2020 – 2021 bull run have mostly failed.
Cryptocurrencies launched in 2009, and since then thousands of cryptocurrencies have been created. It is estimated that 90% of the cryptocurrencies that have launched this year have died. There must be some reason behind this, come let’s have a look at that.
The reason might be because the creator designs them as part of a ‘pump and dump’ scheme. In this cryptocurrencies are promoted to inflate their value and captivate investors. What exactly happens is when the prices increase, the creators sell their holdings, and this will result in a crash. Eventually, investors will be left out with worthless coins.
Poor management can also be a reason. For smooth performance, effective leadership and planning are mandatory. Failure happens when the cryptocurrency is not having proper purpose and design technology.
Users need to be very careful about the security of cryptocurrencies. Usually, cryptocurrencies with weaker security are targeted.
These all are some of the core reasons for the failure of cryptocurrencies.
Cryptocurrency Failure by Year of Launch
| Year | Number of failures | Dead coins % of total coins |
| 2014 | 37 | 77% |
| 2015 | 27 | 68% |
| 2016 | 32 | 61% |
| 2017 | 346 | 57% |
| 2018 | 1,104 | 28% |
| 2019 | 1,154 | 5% |
| 2020 | 1,806 | 1% |
| 2021 | 5,724 | <1% |
| 2022 | 3,520 | <1% |
| 2023 | 289 | <10% |
Come let’s look at some of the failed cryptocurrencies
SpaceBit
SpaceBot is a cryptocurrency used as a medium of exchange which was established in 2014. This had a great possibility of progress but somehow it couldn’t perform as expected and ended up delivering only for a short span of time.
PayCoin
PayCoin has gained popularity within a really short span of time, however, after some time everything has been shut down. It is obvious that anything will fail if they cannot keep the promises, that is the exact thing that happened with PayCoin.
Dogecoin
The expectation of Dogecoin was comparatively less, and the team that worked behind this has also kept the least faith in its longevity. But surprisingly, the majority of the consumers found this one useful. The failure of Dogecoin was a mutual decision by the owners, they removed this from the catalog, and this is no longer a medium of exchange.
Ethereums DAO (Decentralized Autonomous Organization)
This came with a high expectation in 2016 but it failed miserably. A remarkable increment of 168+ million dollars was achieved when it was launched. Even though it has failed over a short span of time, its impact on the market is significant.
GetGems (Gems)
GetGems is an electronic means of exchange which was established in 2014. Of course, GetGems was a huge success at that time, but after a while, everything was steeped down and eventually failed. The team couldn’t fulfill the promises they had made, and that was the major reason for the failure.
SafeMoon (SAFE)
SafeMoon is often termed SAFE, which was formed in 2021 and grabbed the attention of social media. The cryptocurrency had a unique mechanism, they encouraged the holding back of investors by 5% of every transaction made are went back to the holder of SAFE. But in 2022, both the funders and promotors of this cryptocurrency had to face serious legal issues against the artificial upliftment of prices. Still, this is tradable and holds a small community of followers.
List of popular dead coins
Check out the table below to know the most high-profile failures in the cryptocurrency industry.
| Failed cryptocurrency | Reason for failure | Date of failure |
| SpaceBit | Shelved after the team changed to another project | March 2015 |
| Ethereum’s DAO (DAO) | Hacked | April 2016 |
| BitConnect (BCC) | The associated exchange closed down | January 2018 |
| Squid Game (SQUID) | Rug pull (scam) | October 2021 |
| TerraUSD (UST) | Reported as an external attack to devalue the coin | May 2022 |
| Luna (LUNA) | Connected to failed algorithmic stablecoin, TerraUSD (UST) | May 2022 |
| SafeMoon (SAFE) | Pump and dump (Scam) | Still operational |
| GetGems | Lack of funding | Still operational barely |
Common objectives of failed cryptocurrencies
To come to a conclusion we have researched several dead cryptocurrencies and examined the core reasons for failure. Read the below section to know about it.
Abandoned or No Volume (65.5% of dead coins)
‘Expectation is the root of all headache’ – Shakespeare
Legitimate cryptocurrency projects with an expectation that investors will be highly allured and dive into their currency. But of the time, this might not happen so it leads to abandonment due to lack of trading volume. Statistics say that more than 65% of cryptocurrencies have failed because of this.
Scam or other issues (22.5% of dead coins)
The most common crypto scam is that developers fall for the fake huge return promise of investors and leave them with a worthless asset. Rug pulls are the most common crypto scam.
ICO fail or short-lived (10.0% of dead coins)
Initial coin offerings (ICO) are the familiar way to raise funds for their projects. Failure happens when they can’t meet the target, so the money is returned to the investors and eventually becomes dead.