The notoriously volatile nature of the cryptocurrency market has led to the failure of many projects. According to statistics from GeckoTerminal and CoinGecko, over 50% of newly introduced cryptocurrencies since 2021 are no longer active in the market. The increasing number of failed tokens has raised concerns about the long-term sustainability of the cryptocurrency ecosystem.
The scale of cryptocurrency failure
Statistics from GeckoTerminal show that 3.7 million cryptocurrency projects out of 7 million listed in 2021 had ceased trading as of March 31, 2025, resulting in a 52.7% failure rate for tokens. The failure statistics have tracked a significant downward trend, peaking in the first quarter of 2025, witnessing 1.8 million failed projects, accounting for 49.7% of the total failures recorded during the 2021-2025 period.
The rapid rise in failures coincides with the overall market instability following major economic or political events. For example, the downturn in the cryptocurrency market coincided with Donald Trump's inauguration in January 2025, which may have contributed to the spike in failed projects.
Meme coins and low-effort projects contribute to failures
The rapid increase in failed token projects may be due to a number of low-quality meme coins entering the market. The launch of platforms like Pump.fun, which simplify the token creation process, has led to a surge of new cryptocurrency projects in 2024. However, the lack of significant value in other cryptocurrency projects makes them prone to failure in the market.
The rapidly increasing number of failed coins in the bull market from 2020 to 2021 stemmed from the ease of token deployment and the hype surrounding meme coins. Some tokens appeared with no true utility or long-term development plans but quickly gained popularity before collapsing rapidly.
The distribution of failures by year
The failure rate of cryptocurrencies varies significantly depending on the year of launch. The market experienced a 70% failure rate of new cryptocurrencies in 2021, with 5,724 tokens disappearing. This trend continued into 2022, with over 3,500 failed projects, accounting for a 60% failure rate. However, the market saw a significant decline in the number of failed tokens in 2023, with 289 failed projects out of 4,000 listed tokens, reflecting a growing trend towards more sustainable projects.
While most tokens launched in 2020 and 2021 faced inevitable failure, recent projects have shown improved outcomes. This indicates increasing maturity in the market, with a stronger focus on accountability and utility.
However, the strong rise in failed cryptocurrencies is challenging the sustainable future of the market. Despite many cryptocurrency projects experiencing significant failures, the market continues to attract new projects, testing their ability to navigate volatility, regulation, and sustainable operation.
