Why most new projects don't survive?

Mass disappearance of projects: the numbers speak for themselves

According to a report by CoinGecko analysts, more than 50% of cryptocurrency projects launched since early 2021 have ceased to exist. This isn't just a statistic — it's a wake-up call for investors.

Moreover, data from the GeckoTerminal platform shows that around 428,000 new tokens were launched in 2021, and by early 2025, this number had grown to nearly 7 million. While such growth may seem impressive, it hides a worrying reality: most tokens are worthless.

One key indicator of a crypto project's viability is trading volume. Analysis has shown that 90% of the defunct tokens had a daily trading volume of less than $1,000.

Reasons for oversaturation and failure

BeInCrypto analyst Sean Lee noted in an interview that the crypto market is saturated with projects lacking real value. He says this is especially evident in the memecoin and decentralized finance (DeFi) sectors. These projects are often hype-driven, promising quick returns but offering neither unique technology nor sustainable business models.

Key factors behind these failures include:

Lack of uniqueness. Many tokens are copies of one another, offering identical features under different names.
Low liquidity. Projects can't maintain stable token prices without sufficient trading volume, making them vulnerable to crashes.
Fraud and "pump and dump" schemes. Some tokens are created solely for the quick enrichment of their founders rather than technological advancement.
Poor marketing and lack of community. Even technically strong projects are doomed without an active community and smart promotion.
Regulatory gaps. The ease of creating tokens and the lack of strict rules contribute to the emergence of numerous questionable assets.

Expert opinions: the market needs a cleanup

Sean Lee emphasizes that the current state of the crypto market resembles a "bubble" filled with junk assets. In his view, only a small fraction of new tokens possess true innovative potential and can withstand competition.

David Sachs, former crypto advisor to Donald Trump, shares this view. He openly stated that low entry barriers, lack of regulation, and the "ease of launching dubious tokens" contribute to market overheating. As a result, investors — especially newcomers — are exposed to high risks of loss.

Sachs believes that until reasonable regulations are implemented, the market will remain vulnerable to manipulation and widespread scams.

What's next for the market?

The current situation requires a reassessment by all market participants — developers, investors, and regulators. The industry's natural "cleansing" is expected in the coming years. Weak projects will disappear, leaving only those that can prove their value in real-world scenarios.

Some likely developments include:

Stricter regulations. Regulators worldwide have begun taking action against scams and fake projects. Laws requiring developer verification and whitepaper standards are being actively discussed in the U.S. and EU.
Rise in real-use cases. Projects offering concrete solutions — from finance to logistics and healthcare — will be in much higher demand than abstract, goal-less tokens.
Growing trust in verified platforms. Users increasingly prefer projects with transparent histories, audited smart contracts, and real teams.
Automation of risk control. Tools for automatically screening tokens for scams, fake volumes, and other red flags are already emerging. These technologies will evolve and become a standard layer of investor protection.

Conclusion

The crypto market is undergoing a phase of reevaluation. Quantity no longer equals quality, and the rise in token numbers is not a sign of progress — it's a symptom of a systemic issue.

Yet crisis brings opportunity — an opportunity to cleanse the market of dead weight and establish a new paradigm, where real value, technology, and resilient ecosystems matter. The future belongs to projects that can deliver tangible benefits and stand the test of time.