Published: January 21, 2024 7:01 am
Author: RT
The data shows that the digital assets most vulnerable to extinction are those launched during bullish periods
Over 50% of all cryptocurrencies listed on the CoinGecko platform since 2014 have failed, according to new analysis compiled by the company this week. Many of the ones that have gone defunct emerged during market bull runs.
Of the 24,000 tokens that have ever appeared on the platform, a staggering 14,039 are no longer operating, the data shows. CoinGecko uses three metrics to consider a token dead – no trade activity in the past 30 days, projects revealed to be scams or rug pulls, and when a project requests to be deactivated.
The majority of the deceased digital assets emerged during the 2020-2021 bull run. The 7,530 now-defunct cryptocurrencies that were launched during this period account for 53.6% of the total on CoinGecko. In comparison, during the 2017-2018 bull market, just over 1,450 of the roughly 3,000 projects launched have since shut down.
“The high number of dead coins during the 2020-2021 period can be attributed to the ease of deploying tokens, and the rise in popularity of memecoins,” CoinGecko wrote. “However, many memecoin projects launch without a product, with the majority being abandoned after a short period of time,” it added.
READ MORE: ‘Worthless’ Bitcoin a tool for criminals – JPMorgan boss
The research showed that cryptocurrencies launched in 2021 have suffered the worst rate of failure, with 5,724 having already gone defunct, making it the worst year for launches. The following year saw a 60% crypto failure rate, with 3,520 projects going extinct. So far, only 289 out of the over 4,000 cryptocurrencies listed in 2023 have been deactivated, representing a failure rate of less than 10%. However, it remains to be seen if this rate will hold as time passes.
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