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Cryptocurrency is a unique technology and innovative asset class with various functions depending on the use case to be solved. Cryptocurrencies such as Bitcoin, Doge, and Dash aim to replace the flats in your wallet, while other cryptocurrencies such as Aave, Compound, and Anchor help you with loans.
Also, on the one hand, there are native tokens that drive the economy of cryptocurrency-based platforms and ecosystems, and on the other hand, there are stablecoins that lock their value to the actual dollar. The use cases and utilities (lofty or humble) that cryptocurrencies handle are enormous, but not all have succeeded in doing what they claim.
There are Thousands of Failed Cryptocurrency Projects so Far
In November 2021, CoinMarketCap records showed that there are over 15,000 coins in the crypto market. However, not all cryptocurrencies leave a mark.
Many crypto assets are just pump-and-dump schemes and rug-pull scams, but many other assets fail despite having good real use cases. Coinopsy, a site that tracks dead coins, reports that more than 2,000 coins have already died since the launch of Bitcoin in 2009.
Why Cryptocurrency Projects Fail
There are several reasons why a cryptocurrency project may fail. Let us explain some of them:
- Competition: Thousands of crypto projects are competing for a share of the blockchain market, so it’s not uncommon for some projects to decline or oppose the community. Similar to the traditional market where products and services are launched on a regular basis, only a few are successful.
- Abandonment: Cryptocurrency platforms are often launched with many fanfares and promotions, but there is not enough funding to move on to the next project or expand the platform in pursuit of further goals. Abandoned on the way by the CEO.
- Lack of a solid business plan: There is a coin called $ STOPELON created to protest the impact of Elon Musk’s tweets on the crypto market. However, we weren’t sure how the platform planned to do this. Similar to this analogy, many of such coins continue to be introduced into the cryptocurrency and blockchain markets without solid planning or use cases. Sometimes these coins are just copies of other established coins.
Lack of a Strong Community and Funding: The Biggest Reasons Crypto Projects Fail
While there are heaps of crypto initiatives that might be misplaced withinside the shadows, they don’t officially die as many of them aren’t closed down. They’re simply abandoned. When community users stop speaking about the project, investors stop investing in the crypto asset, or builders become bored and prevent updating the task, the task fails and loses traction withinside the marketplace.
To recognize why groups are a considerable thing withinside the fulfillment and failure of a crypto task, we want to acknowledge what those belongings indeed are. Cryptocurrencies (and therefore, crypto tokens) are basically networks of computer systems that unfold throughout the globe. As extra humans are part of those networks, the crypto initiatives develop and so develop their value.
The fulfillment of the meme coins such as Doge, Shiba, Baby Doge, etc., is a testimonial to the truth that community users could make or destroy a coin. Many could argue that crypto markets have visible mediocre tokens carried out nicely withinside the marketplace due to the fact a faithful network has subsidized them.
Failure to get price range on the proper time is some other principle motive for initiatives fading away into nothingness. Getting access to VC funds requires some level of toil and effort from the team members and developers in developing and presenting their WhitePaper, ToS Sheet, etc., to present their business plan. Many initiatives fail to move the access boundaries to VC investment or generate investment from an IDO launch.
Strong groups deliver new traders and ordinary investments that could preserve the task in blooming health.
Most Popular Cryptocurrencies That Have Failed
Launched in 2014, OneCoin was one of the earliest crypto scams. Its founder, self-proclaimed “Crypto Queen,” Ruja Ignatova has hosted spectacular events around the world, including at the Wembley Arena in the United Kingdom. So she praised OneCoin as a “bitcoin killer”.
2. BitConnect (BBC)
Launched in 2016, BitConnect is any other now-notorious fraudulent coin. The coin hit an all-time excessive in December 2017 and became one in all CoinMarketCap`s satisfactory appearing cash that year. But only some months, later it became really well worth nothing.
Its competitive advertising promised returns of 0.5% to 1% in keeping with the day, alongside different incentives. But like OneCoin, it became a pyramid scheme. The excessive returns it paid out have been being funded through new investors, and while the platform collapsed, investors lost everything.
3. BoringCoin (ZZZ)
Launched in 2014, Boring Coin did not promise to spread dramas, hype, or rumors. Like the estimated 90% to 95% of hoax coins, it didn’t survive the year. Coinopsy lists the coin as a joke or dead because it didn’t serve its purpose. Or maybe it was too boring.
4. GetGems (GEMZ)
GetGems was an app that offered social messaging allowing people to send and receive Bitcoin. Users can earn more GEMZ by inviting their friends to sign up. Founded in 2015 by Daniel Pered, the company raised about $ 1 million through crowdfunding and direct investment but was ultimately unsuccessful. According to CoinMarketCap data, its price peaked at $ 0.0579 in May 2017 before the coin stopped trading altogether.
5. NanoHealthCare Token (NHCT)
We’ve seen some of the old cryptocurrencies, but some new coins, including the NanoHealthCare token, have already failed. India-based tokens were created by Manish Ranjan in 2018 to change the reality of healthcare. He wanted to use blockchain technology to impact lives by solving systematic healthcare issues such as data security and expensive costs.
When you are working in an open-source ecosystem, you have to listen to your community members and build services that they can rally on. The reason why projects fail is not that their technology is not working, but because they haven’t stirred the community that cares about their mission.