By Tom Blitzer
Key Insights:
- The cryptocurrency market saw a surge in failed coins, scams, and abandoned projects.
- 2013 to 2018 witnessed a high abandonment rate, with over half of the introduced coins disappearing.
- Recent trends show decreased abandonment rates, but concerns remain amid market slumps and uncertainties.
In the fast-paced world of cryptocurrency, 2013 stands as a pivotal year. The price of Bitcoin skyrocketed from $150 to $1,000, igniting the first major boom in digital currencies. Riding the wave of Bitcoin’s success, 84 new coins emerged in 2013, followed by a staggering 607 in 2014. However, this euphoria was short-lived. A whopping 91% of coins established in 2014 eventually met their demise due to low trade volume or abandonment, leaving only Bitcoin and Litecoin among the top survivors.
ICO Frenzy: Scams and Fallout
While 2017 marked a significant milestone with increased interest from business leaders and lucrative initial coin offerings (ICOs), it also became a breeding ground for scams. A staggering 80% of the $11.9 billion raised in ICOs that year was fraudulent, leading to a cascade of 704 dead coins. 2018 witnessed the highest number of ICO scams, with 30% of the 751 deceased coins exposed as fraudulent.
The fragility of the crypto market became evident as the years progressed, with over half of the coins introduced between 2013 and 2018 fading into oblivion. Astonishingly, three-quarters of the currencies introduced in the aftermath of the 2014 boom no longer exist. This highlights the volatile and unpredictable nature of the cryptocurrency landscape.
Hope Amidst Decreasing Abandonment
However, recent trends offer a glimmer of hope as the abandonment rate appears to be decreasing. Since 2020, only 16 coins have met their demise due to a lack of investment, indicating a maturing market. Yet, concerns loom over the impact of the 2022 slump in crypto value, raising the possibility of more coin casualties in the future.
As the cryptocurrency industry evolves, the ghosts of failed coins and the lessons learned from their demise serve as a cautionary tale. The wild West of digital currency holds both promise and risk, reminding us that prudent investment and scrutiny are vital for navigating this uncharted territory.