Almost 74% Cryptocurrencies in Cardano are Deadcoins which shook the entire crypto space and affecting Cardano’s price.
Since its beginning, the cryptocurrency market has witnessed a major number of projects failing. Over 24,000 cryptocurrencies have been listed since 2014, with 65% of them being classified as ‘dead’ or failed. But in Cardano, approximately, 74% of cryptocurrencies are dead according to the report.
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74% of cryptocurrencies in Cardano are Deadcoins
This high failure rate highlights the volatile and speculative nature of the cryptocurrency industry, indicating that a significant proportion of projects are not sustainable in the long term.
More than half of the cryptocurrencies launched during the 2020-2021 bull run have also met the same fate. The market collapse in late 2022 led to the failure of 65% of all projects in the sector.
The period of 2020-2021, characterized by a bull run, saw the highest number of failures, with 7,530 cryptocurrencies launched during this time failing to survive. This trend persists, with research indicating that the majority of new cryptocurrencies ultimately fail, primarily due to declining trading volumes or complete abandonment by their communities.
According to Crypto Twitter. @Cardano is a deadcoin…
— Market Mobster (@MarketMobsterUK) November 23, 2022
Good numbers from #DOT again.
Focus on projects building in the bear market. https://t.co/P58gB1kPli
65% of Crypto Projects cease to exist
AlphaQuest research highlighted 2023 as the most challenging year in the 2020-2023 period, with almost 60% of the cryptocurrencies that failed to do so within this timeframe. Overall, the study found that by 2023, 65% of cryptocurrency projects had ceased to exist, becoming so-called deadcoins.
Highest Rates in the Cardano and Terra Ecosystems
The Terra and Cardano ecosystems experienced the highest rates of project failures. To classify projects as deadcoins, researchers used a set of criteria such as low trading volume and liquidity, inactive or deleted Twitter accounts, and websites that were no longer operational.
Despite these trends, the meme-based cryptocurrency Dogecoin (DOGE) has managed to defy the odds and maintain its presence in the market. This trend underscores the challenges and risks associated with cryptocurrency investments and the importance of due diligence and regulatory compliance for projects seeking longevity in this competitive space.
Lifecycle of Cryptocurrencies
A study focusing on the lifecycle of cryptocurrencies, including both coins and tokens listed on CoinGecko and now considered ‘deactivated’ or failed, revealed several factors contributing to deactivation and subsequent removal from CoinGecko.
These factors range from a lack of trading activity for a continuous period of 30 days to projects being identified as scams or ‘rug pulls,’ either through media reports or direct communication to CoinGecko from verified sources.
Additionally, projects themselves might request removal in cases where the team decides to disband, undergo a rebranding process, cease operations, or undertake significant token modifications that result in the original tokens becoming illiquid or obsolete, according to the standards set by CoinGecko.
Conclusion
To conclude, according to a report, 74% of cryptocurrencies in Cardano are dead. The cryptocurrency market has faced many challenges, with a majority of projects failing to sustain in the long term. The high failure rate highlights the importance of thorough research and regulatory compliance for projects seeking success in this volatile industry.