Cryptocurrency Market Sees 53% Failure Rate Since 2021

Over 50% of cryptocurrencies launched since 2021 have become defunct, with ghost tokens increasingly dominating the market in 2025. This trend highlights the challenges and failures within the cryptocurrency landscape, where many projects struggle to maintain utility, liquidity, and community engagement. Ghost tokens, which are cryptocurrencies that have lost all value and functionality, are a growing concern, with a significant portion of listed cryptocurrencies failing, particularly in 2024 and 2025.

According to a recent report, of around 7 million cryptocurrencies listed since 2021, 3.7 million have failed. The indicators of a coin’s death include losing all utility, liquidity, and community engagement. This is often marked by near-zero trading volume and price drops of 99% or more from all-time highs. A significant 53% of listed cryptocurrencies have failed, with most collapses occurring in 2024 and 2025. This year alone, 1.82 million tokens have already stopped trading, underscoring the instability of the market.

Experts attribute the high failure rates of cryptocurrency projects to various factors, including macroeconomic instability and inadequate project planning. Economic instability has been linked to the rise in meme coin launches, which often decline due to market volatility. Common failure indicators include the inability to find a product-market fit, a focus on short-term speculation without a long-term roadmap, and teams abandoning projects, leading to rug pulls.

2024 saw a surge in meme coin launches following the introduction of Pump.fun on Solana, which allowed for token creation at minimal costs. Despite the high number of token launches, failures now nearly equate to successes, highlighting the market's instability. This trend is particularly evident in niche categories like music and video tokens, which are failing at rates as high as 75%. These areas face significant challenges in adoption and utility, compounded by competition from traditional platforms and legal hurdles.

Learning from the failures of projects like BitConnect and OneCoin is crucial for future token developers. These downfalls exemplify the dangers of launching projects based on hype without substantial technology or transparency. The rise in ghost coins serves as a stark reminder of the importance of rigorous research. Investors must validate projects and maintain a cautious outlook, especially with rapidly changing market dynamics. Prioritizing due diligence, or “Do Your Own Research” (DYOR), is vital for investors to navigate the crypto space safely. The prevalence of ghost tokens underscores the critical need for thorough analysis and sustainable value in identifying enduring crypto projects.