More Than 1,000 Cryptos Dead
According to data collated from Coinopsy and DeadCoins, the two websites actively cataloguing failed or failing cryptocurrency projects, more than 1,000 crypto projects have died so far this year.
Definition of “Dead”
The definition of a “dead” cryptocurrency according to Coinopsy is a cryptocurrency that shows at least one of the following features: an abandoned project, a scammed project, the website itself is dead, there are no nodes, there are severe wallet issues, there are no social updates for the crypto, very low trading volumes or developers themselves have walked away from the project.
Together, DeadCoins and Coinopsy have listed more than 1,000 cryptocurrency projects that are officially dead. A lot of these projects are outright scams, such as the scam BRIG by the two brothers, Jack and Jay Brig, or Titanium, the project that ended up being investigated by the SEC. However, there are some projects that are just abandonware – software projects that are abandoned or ignored by their developers or end up getting no support to get off the ground.
While this list seems huge, speculation in the market is that there are actually many more projects that have died than just the 1,000 listed. There is also talk that the 1,500 cryptos listed on Coinmarketcap should also be reassessed as they may be on the verge of dying.
Majority of ICOs are Frauds
While 2017 has been touted as the “year of the ICO”, market analysis done by Bloomberg author Aaron Brown states that as much as 80% of the ICOs are fraudulent schemes. He goes on to state that another 10% are without substance and the remaining 10% are also doomed to failure.
According to other market analysts, most ICOs are faced with a hugely turbulent life, which is only 4% of them find any form of success. Compared to other technology companies, Blockchain and cryptocurrency based startups have struggled a lot more. Data shows that only half the companies have been successful in raising funds in the second rounds. That number plunges to barely 2% by the third round of funding.
The challenge here is that there is a massive potential for fundraising, which is being exploited by greedy scammers. And while startups are expected to fail, the amount of money being pumped into ICOs is a huge problem. Scam ICOs raised more than $1 billion in 2017 – all of which are now dead.
Market experts state that until these ICOs scams have hurt the cryptocurrency market a lot and recovery will be difficult unless regulations are put in place to prevent such huge losses.