Why cryptocurrencies die: reasons and examples of "dead coins"

According to the Coinopsy and DeadCoins services, more than 2,400 once-successful crypto projects are now considered "dead." Moreover, over 90% of cryptocurrencies become zombie coins within one to one and a half years after their launch.

What are zombie coins and how to recognize them?

Zombie coins, also known as "dead coins," are cryptocurrencies that have ceased development but remain formally in existence. Typically, these altcoins are removed from major exchanges, and their trading volume and market capitalization approach zero, along with the asset value.

For example, crypto projects such as Lisk and Waves were once at the pinnacle of the crypto market. However, growing competition and a lack of new ideas have effectively rendered them obsolete.

It's essential to keep in mind that the crypto market is highly dynamic — any project currently at the top of CoinMarketCap could become "dead" shortly. It's impossible to predict in advance which project will end up this way, but there are a few signs to watch out for.

According to analysts, the most common reasons for the "death" of crypto projects are scams, counterfeit projects, Ponzi schemes, lack of funding, and high market competition. However, there are other signs as well.

1. Scam

According to various expert estimates, about one in two projects on the crypto market is a scam or a financial pyramid — this is the most frequent cause of zombie coins. Naturally, these projects become "dead" faster than others — within months or even less.

Signs of a scam can include:

• The anonymity of the team or the use of fake accounts
• Promises of guaranteed profits
• Copied source code (scams often mimic successful projects)
• Recently registered domain
• Aggressive marketing designed to trigger FOMO (Fear of Missing Out)
• Lack of liquidity and a real product

Most scam projects last from a few days to several months, but there are also examples of successful projects that made it to the top by market capitalization.

For example, BitConnect's capitalization peaked at $3.6 billion at the end of 2017, with its token BCC priced at $463. BitConnect launched in 2016 and positioned itself as a decentralized lending platform, which ultimately proved to be a classic financial pyramid scheme. In January 2018, right after the market crash, the team announced the closure of the project and vanished from the radar, while the BCC token price collapsed to zero. BitConnect became one of the most significant scam projects in the history of cryptocurrencies.

2. Low trading volume

This is another sign of zombie coins that you should be aware of. Even the less capitalized projects on the crypto market have trading volumes in the tens of millions of dollars.

Developers may release a token before launching the main product to attract investments, but this involves significant risks, as the team might not deliver as planned, and the project may cease to exist.

Such a scenario occurred with Electroneum (ECN). The project's team launched its token during the massive DeFi boom in 2021, hoping to attract funding. At its peak, Electroneum's market capitalization reached $700 million.

Despite a successful launch, the project was never realized, and its token price plummeted by more than 98%. As of June 2025, Electroneum's market capitalization is $28.3 million, and its daily trading volume is $6 million. For comparison, many tokens with a volume of less than $20 million don't even make it into the top 200 of CoinMarketCap's rankings.

Although Electroneum is not yet a completely "dead" project, its prospects are almost non-existent. However, if the trading volume is less than $100,000, the project can already be considered virtually dead — it's likely been abandoned.

3. Low developer activity or its complete absence

Most blockchain projects are transparent, meaning their source code is open for everyone and hosted on GitHub, where users can check the activity of developers.

If you examine the GitHub repositories of major cryptocurrency projects, you'll see that their code is updated almost daily. Even updates once a week are pretty rare for large projects, let alone a month-long hiatus.

If it's been over a year since the last update, you're likely dealing with a zombie coin. Investing in such an asset is extremely risky and is expected to result in significant losses. Of course, there are exceptions, such as rare NFTs that are collectible items.

Additionally, it's essential to check the team's activity and how regularly the project's blog and social media accounts are updated. If the website is nearly abandoned and there are no social media updates — you're dealing with a zombie coin.

For example, in 2017, a group of enthusiasts launched a "dentistry token" called Dentacoin (DCN). At its peak in January 2018, the project's market capitalization reached $2 billion, but as of June 2025, the token is no longer traded anywhere.

Dentacoin's social media has been inactive since 2020, and analysts believe the idea of a "cryptocurrency for dentists" simply didn't catch on. The project's success was entirely driven by the ICO (Initial Coin Offering) hype: even the most useless assets often reached billion-dollar valuations.

4. Lack of funding and high competition

These two factors go hand in hand: to develop a competitive project, adequate funding is essential. Even for launching simple applications, tens of millions of dollars may be required, with a significant portion of that amount allocated to marketing. For larger projects, investment sums can reach hundreds of millions of dollars.

However, even significant investments don't guarantee that a project will withstand competition. Market trends are constantly evolving, and new projects that capture users' attention are launched every day.

For example, CloakCoin (CLOAK), which focused on privacy, was launched in 2014. However, the project couldn't compete with Monero (XMR) and ZCash (ZEC), which became leaders in the privacy coin segment.

Conclusion

If, based on the signs, you can't independently verify whether a project is "dead", you can use specialized services such as DeadCoins and Coinopsy. These services publish lists of zombie coins, and you can check a project's name in the list.