800 Cryptos Now Dead as Bitcoin Holds Only 30% of Its Record High

| Updated
by Bhushan Akolkar · 3 min read
800 Cryptos Now Dead as Bitcoin Holds Only 30% of Its Record High
Photo: Julien Parent / Flickr

The ICO-market has gone through a high failure rate of 46% with several ICO projects turning out to be deceased or scams.

After an unprecedented run during the second-half of 2017, the cryptocurrency market has undergone a severe erosion in its valuation in the last eight months. The world’s largest cryptocurrency Bitcoin has dropped by 70% since hitting its all-time high of $20000 during mid-December 2017.

During the time of the crypto mania in 2017, several new digital currency tokens were introduced to the crypto market by the popular means of Initial Coin Offerings (ICOs). However, the latest report released by CNBC shows that more than 800 such digital currency tokens are now dead, comparing this scenario of the ICO market directly with the dotcom bubble of the 90s.

Initial Coin Offering (ICO) is a method used by many businesses and startups to raise funds by selling their digital tokens to the investors. Investors buy these digital tokens at an early stage to reap maximum profits considering the future growth and potential. Although the ICO-market witnessed a slowdown by the end of 2017 raising $3.8 billion in total, 2018 so far has proved to be very fruitful with over $13.5 billion being raised just during the first five months of this year, according to the latest report by PwC.

However, according to the list provided by Dead Coins, a website that keeps a track of all the failed cryptocurrency and ICO projects, more than 800 such projects are dead now. These digital tokens have turned to be absolutely worthless or now trade below 1 cent in price. Dead Coins categorizes all these digital tokens as ‘Deceased’, ‘Hack’, ‘Scam’ or ‘Parody’.

Since the beginning of this year, there have been multiple reports from different financial agencies about scams being unearthed in the ICO market. All these multiple scams have drawn the attention of regulatory bodies from around the globe that has resulted in heavy scrutiny of ICO projects. Analysts believe this to be healthy in a way and, in the long run, it will help to weed out bad players from the cryptocurrency market.

Two months back in May 2017, the U.S securities watchdog – Securities and Exchange Commission (SEC) released a fake ICO website and tokens called HoweyCoins while demonstrating and educating investors of how not to fall prey to the malicious ICO schemes.

The Oracle of Omaha and investment guru Warren Buffet has repeatedly criticized Bitcoin to be having no intrinsic value and even calling them as ‘rat poison squared’. During one of his recent interviews with Yahoo Finance, Buffet said:

“If you buy something like bitcoin or some cryptocurrency, you don’t have anything that is producing anything. You’re just hoping the next guy pays more. And you only feel you’ll find the next guy to pay more if he thinks he’s going to find someone that’s going to pay more. You aren’t investing when you do that, you’re speculating.”

In the last two days, Bitcoin has shown minor signs of recovery and is currently trading for a price of $6581, according to the data on CoinMarketCap.

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Bhushan Akolkar

Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.

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