Shocking: Crypto Token Failures Soar, 1 in 4 Launched Since 2021 Died in Q1 2025, CoinGecko Data Shows
Are you invested in the latest altcoins? Recent CoinGecko data paints a stark picture of the volatile world of digital assets, revealing a massive wave of crypto token failures. Understanding these trends is crucial for navigating the market.
What Does CoinGecko Data Reveal About Token Survival?
According to a recent report from crypto data platform CoinGecko, the rate at which crypto tokens are failing has dramatically increased. Since 2021, CoinGecko’s GeckoTerminal tool has tracked nearly 7 million cryptocurrencies. The findings show that over half of these, specifically 3.7 million tokens, have stopped trading and are now considered failed projects.
The report highlights:
- Nearly 7 million tokens tracked since 2021.
- Over 3.7 million tokens have failed.
- A significant acceleration in failures during early 2025.
Why Did Crypto Token Failures Spike in Q1 2025?
The first quarter of 2025 saw an alarming number of token collapses, with 1.8 million tokens dying off. This represents nearly half of all failures recorded since 2021 and about a quarter of all tokens launched in that period. CoinGecko research analyst Shaun Paul Lee linked this surge to several factors, including broader market turbulence. Following a peak in Bitcoin’s price around Donald Trump’s inauguration in January, the wider crypto market experienced a sharp downturn, contributing to the high failure rate.
How Did Pump.fun Impact the Number of New Crypto Tokens?
A major driver behind the ballooning number of both new tokens and subsequent failures is the rise of simplified token creation platforms like Pump.fun. Launched in January 2024, Pump.fun made it significantly easier and cheaper for anyone to create and launch a token, leading to a flood of low-effort projects, particularly memecoins, entering the market.
Comparing years:
- 2024 saw over 3 million new tokens launched (Pump.fun’s first year).
- 2023 saw just over 835,000 new tokens.
- Prior to 2024, token failures were in the low six digits.
- Failures from 2021-2023 made up only 12.6% of total failures over the past five years.
This data clearly shows a correlation between the ease of creating new crypto tokens and the increased rate of project failures.
Is the Crypto Market Downturn to Blame?
While platforms like Pump.fun facilitate the creation of tokens, the broader crypto market downturn plays a significant role in their survival chances. Market sentiment, volatility, and investor interest directly impact a token’s ability to maintain trading volume and liquidity. CoinGecko founder Bobby Ong noted earlier in March that memecoin investor interest seemed to cool after several unsuccessful launches, such as the Libra token.
Even on platforms like Pump.fun, the ‘graduation rate’ (tokens successfully moving off-site) remains low, with roughly 98% failing. The platform’s best week saw only 1.67% of memecoins graduate. This underscores the difficulty even easy-to-launch tokens face in gaining traction and surviving market conditions.
Key Takeaways on Token Longevity
The CoinGecko report provides critical insights into the current state of the altcoin market. While innovation continues to drive the creation of new projects, the data highlights a significant challenge: survival. The combination of simplified token creation leading to market saturation and challenging market conditions from the recent downturn creates a difficult environment for many new tokens.
In summary, crypto token failures are at an all-time high, heavily influenced by both accessible launch tools like Pump.fun and the broader crypto market downturn. Investors should exercise caution and conduct thorough research when considering new crypto tokens, as the CoinGecko data indicates a high probability of failure for the majority of recently launched projects.
