Crypto Failure Rate Surges 50% Since 2021, 3.7 Million Tokens Dead
3min read Over 50% of all cryptocurrencies launched since 2021 have failed, with a significant portion of these collapses occurring in 2024 and 2025. This trend is particularly alarming given that the failure rate in the first five months of 2025 has already matched the overall failure rate since 2021. Representatives from Binance and Dune Analytics attribute these failures to the lack of viable projects, weak tokenomics, and insufficient community support.
Ask Aime: What's behind the surge in crypto failures?
According to a report from CoinGecko, approximately 7 million cryptocurrencies were listed since 2021, but 3.7 million of these have since died. A coin is considered 'dead' when it loses all utility, liquidity, and community engagement. Key indicators include near-zero trading volume, abandoned development, and a price drop of 99% or more from its all-time high. Teams often vanish without warning, with social media accounts going dormant and domains expiring.
Half of all tokens launched since 2021 have died, with most collapses concentrated in 2024 and 2025. Notably, over 1.82 million tokens have already stopped trading in 2025, significantly outpacing the approximately 1.38 million failures recorded throughout 2024. With seven months left in the year, this trend of increasing failures is expected to continue.
Ask Aime: Why are so many new cryptocurrencies failing?
Experts point to various factors contributing to the high failure rate of cryptocurrency projects, often termed “ghost coins.” These include broader macroeconomic conditions affecting the crypto market, such as tariffs and recession fears. Additionally, the surge in meme coin launches after certain elections, followed by market volatility, has likely contributed to their decline. However, not all responsibility can be placed on economic downturns. Other factors include the inability to find a product-market fit, short-term speculation without a long-term roadmap, and abandonment by developers.
The rapid rise in ghost tokens is also linked to the exponential launch of projects, particularly since the start of 2024. Last year saw the proliferation of meme coins, driven by platforms like Pump.fun on Solana, which allowed anyone to launch a token at a minimal cost. According to CoinGecko data, 3 million new tokens were listed in 2024 alone, with half of these projects dying. However, the situation in 2025 appears less stable, with the number of new token launches nearly equivalent to the number of failures.
Ecosystems with low barriers to token creation see the highest number of ghost coins. Platforms that make it very easy and cheap to launch new tokens often see the most abandoned coins. The greater meme market has also taken a particular blow to its popularity, with the meme coin market capitalization sharply decreasing to $54 billion as of March 5, marking a 56.8% drop from its peak of $125 billion on December 5, 2024. This downturn was accompanied by a significant decrease in trading activity, with volumes falling by 26.2% in the preceding month alone.
Certain token categories have been hit harder than others. A report indicated that video and music were prominent categories with many failed cryptocurrency projects, reaching a 75% failure rate. These niches face adoption and utility gaps, with music tokens struggling to compete with mainstream platforms like spotify and YouTube. 'Listen-to-earn' models often lack demand, and many projects struggle to remain sustainable without substantial user adoption or strong network effects.
Despite the discouraging number of failed tokens, this situation offers important insights into building resilient projects that withstand unfavorable market conditions. Prospective token creators can learn significant lessons from once-popular projects that ultimately failed. The negative outcomes experienced by these ventures, particularly in severe instances, can motivate the development of new projects responsibly and avoid similar pitfalls.
Binance referred to notorious ghost coin cases such as BitConnect and OneCoin. BitConnect, once a top-10 coin, collapsed in 2018 after being exposed as a Ponzi scheme promising daily returns. Investors lost nearly $2 billion. OneCoin, raising approximately $4 billion, never had a real blockchain and relied on aggressive multi-level marketing before collapsing. These examples highlight the dangers of projects built on hype, unrealistic promises, and lack of verifiable technology.
These cases also offer valuable lessons for individual investors trading tokens, regardless of whether the token is newly launched or more established. The rising number of ghost coins serves as a crucial reminder that discernible warning signs often precede the downfall of these cryptocurrencies. These cases underline the necessity of rigorous research, validating underlying principles, and maintaining a cautious perspective, especially when investment gains appear unrealistically high. Prioritizing risk management and sustainable long-term factors should outweigh short-term speculative trading.
Binance particularly highlighted the importance of “Do Your Own Research” (DYOR) when evaluating crypto projects. This means reviewing the whitepaper, assessing whether the project solves a real problem, verifying the team’s credibility, examining tokenomics and supply distribution, and checking community and development activity. In essence, DYOR is about empowerment and protection. It helps investors identify solid projects and avoid scams or ghost tokens by spotting red flags early. Given how fast crypto markets move, personal due diligence remains essential for navigating the space safely and successfully.
Ultimately, the prevalence of ghost tokens highlights a critical truth for crypto participants: thorough research and fundamental value are paramount for identifying lasting projects. 
