Over Half of New Crypto Projects Fail as Ghost Tokens Flood Market, Raising Risk for Traders
A new CoinGecko report highlights that more than 50% of new cryptocurrencies launched since 2021 have already failed, signaling a significant risk in the crypto market. The number of crypto projects surged 1,500% since 2021, reaching nearly 7 million by 2025, largely driven by rapid token creation platforms like those on the Solana blockchain. However, about 3.7 million tokens are now defunct, mainly due to lack of utility, liquidity, and community support. The failure rate peaked in 2024 and 2025, with 1.8 million projects collapsing in 2025 alone, including rampant failures among meme coins and niche categories like music and video tokens, which saw failure rates as high as 75%. Experts cite poor tokenomics, speculative launches, project abandonment, macroeconomic volatility, and regulatory concerns as key causes. This wave of ghost tokens reflects growing market volatility and underscores the importance for crypto traders to conduct thorough due diligence, validate project fundamentals, and focus on long-term viability before investing. The trend raises caution, especially regarding non-viable altcoins, and references past high-profile failures like BitConnect and OneCoin as warning examples.
Bearish
The surge in ghost tokens and the high failure rate of new cryptocurrency projects, as outlined in the CoinGecko report, are clear bearish indicators for the market. This trend signals increased volatility and growing risk from speculative, unsustainable projects, especially in the meme coin and niche token segments. Such a high proportion of failed tokens undermines trader and investor confidence, potentially dampening inflows to new projects and driving skepticism toward future launches. The market is also likely to see increased regulatory scrutiny and more selective capital allocation, pressuring non-viable altcoins and potentially leading to broader sell-offs during periods of uncertainty. Long-term, only fundamentally strong projects with clear utility may outperform, but for now, the influx of ghost tokens and project failures point toward a bearish outlook.