The crypto bull run of 2017 turned a lot of heads in both the crypto and mainstream financial markets. However, the scale of the bull run also opened the doors for many who sought to take undue advantage of the state of the market. At the peak of the bull run and for months after, many crypto-projects were launched and hundreds of gullible investors with a bare understanding of the space were dragged into several scams and illicit ventures.
A majority of these projects did not last for long in 2018 as a lot of investors soon lost their capital. The credibility of many in the crypto space was questioned after a substantial number of projects got shut down every month following the Bitcoin bull run.
According to Longhash’s recent report, the fate of such crypto-projects and the market may have relatively improved in 2019.
2019, while it started positively, was later overtaken by the bear market and soon, a huge number of crypto-projects begin to bite the dust. However, according to data provided by DeadCoins.com, in 2019, a total of 518 projects died, which is 20 percent lower than the 647 projects that died in 2018.
The data released categorized the dead projects in terms of Deceased, Hack, Scam, and Parody.
According to the chart, it was identified that a majority of the dead projects were termed as scams in both 2018 and 2019. In 2018, 55 percent or 365 projects were tagged as scams and in 2019, 55 percent or 305 of these ventures were found to be fraudulent.
Speaking in detail about the projects in 2019, it was observed that a majority of these projects died in the first three months itself. A combined 283 projects were out of business by January, February, and March, whereas only 83 projects were shut out in the 2nd quarter of the year.
The study also claimed that most scams projects had a life expectancy of fewer than 1 year, whereas legitimate ones ran for a period of 1 and 3 years.
The drop in the number of dying projects highlighted that the quality of crypto-ventures in the industry was on the rise. This was supported by Delottie’s 2019 global blockchain survey which suggested that more military and enterprise-based blockchain ventures had emerged in 2019.
The report concluded by suggesting that since a large number of the projects were launched in 2018 (mostly ICO‘s), the number of dying projects will remain consistent for at least 2 years.