Hundreds of Blockchain Projects Casualty of 2018 Crypto Market Correction
The cryptocurrency markets are in rally mode for the first time in a long time, but it’s bittersweet. The downtrend has left many casualties in its wake, as evidenced by more than 1,000 projects meeting their demise this year. The data comes from a couple of websites dedicated to tracking failed blockchain projects, Coinopsy and Deadcoins, cited in TechCrunch, and it serves as a reminder of the nascent stage of the market.
CNBC also reported on the state of the market, pointing to more than 800 coins that are now worth fractions of a penny. Prior to today’s rally, Bitcoin has shed about 70% of its value year-to-date, but the pipeline for new coins doesn’t appear to have abated.
The shakeout, or what some would call a bursting of the bubble, in the market was expected. Blockchain veterans like Joseph Lubin have been calling for a consolidation of the industry for months, with the Ethereum Co-Founder having once told CNBC that many ICOs are worthless. Ripple Chief Brad Garlinghouse, meanwhile, echoed that sentiment, pointing to a “gray area” in which ICOs operate until regulation “catches up.”
Indeed, there will be no love lost between the cryptocurrency community and many of the failed projects, which range from software that was abandoned to fraudulent schemes.
One such blockchain startup dubbed BRIG by developers who went by Jack and Jay Brig was a “scam coin that totally collapsed” and through which investors lost money, according to Deadcoins. Others had big ambitions, such as the Clout coin, an ICO-rating project that billed itself as a competitor of Steel. The project has since been abandoned, Deadcoins reveals.
Even as evidence of more than 1,000 failed blockchain projects surfaces, The Wall Street Journal published a report today disclosing the ICO totals for the year. Year-to-date, ICOs have raised $11.8 billion, more than double 2017’s total of $5.5 billion. Blockbuster deals like Telegram and Block.one alone raised billions of dollars for their respective projects.
Today’s mini-rally is certainly bringing some respite to investors, but it is too little too late for many coins. The bitcoin price advanced as much as 12% today, jumpstarting 2H2018 after a first half that many traders want to keep in the rearview window.
Market strategists like Fundstrat’s Thomas Lee have not reneged on their bullish outlook for the bitcoin price, with Lee sticking to his prediction for bitcoin $25,000 by year-end. Arthur Hayes, co-founder and CEO of BitMEX, a crypto trading platform that profits from volatility in the bitcoin price, is calling for BTC $50,000 in 2018.
For perspective, bitcoin is up more than 100% year-over-year despite the hiccups that the market has experienced in the short-term.
Featured image courtesy of Shutterstock.