Crypto token failures are surging, with a staggering one in four tokens launched since 2021 meeting their demise in the first quarter of 2025, according to recent data from CoinGecko. This alarming trend, highlighted in an April 30 report by CoinGecko research analyst Shaun Paul Lee, underscores the growing volatility within the cryptocurrency landscape as well as the ease of token creation contributing to this precarious situation.
Token Turbulence: A Market in Flux
In a market already reeling from broader economic uncertainties, the first quarter of 2025 alone witnessed the collapse of 1.8 million crypto tokens—a record number of failures for any single year. Lee attributes this wave of failures to “broader market turbulence” following the inauguration of Donald Trump in January, an event that initially saw Bitcoin (BTC) reach new heights before the market took a sharp downturn.
“Alarmingly, this quarter not only marks the highest number of failures recorded in a single year but also represents nearly half of all token failures since 2021,” Lee noted in the report. The sheer volume of failed tokens is staggering, with over half of the nearly 7 million cryptocurrencies listed on CoinGecko’s GeckoTerminal since 2021 now defunct.
The proliferation of tokens can be partly traced back to the introduction of the Pump.fun platform, which went live in January 2024. This platform has significantly lowered the barriers to entry for token creation, leading to a deluge of memecoins and low-effort projects flooding the market. “Before Pump.fun’s launch, cryptocurrency failures were relatively modest, numbering in the low six digits,” Lee explained, emphasizing how the landscape has shifted dramatically in recent years.
The Rise and Fall of Pump.fun
Pump.fun has played a pivotal role in the current state of the crypto market. The platform, designed for ease of use, has facilitated the creation of millions of tokens, most of which have failed to gain traction. “The graduation rate of tokens from Pump.fun, where they move off the platform to trade on the open market, has never been particularly high,” Lee remarked, with approximately 98% of tokens failing to make the leap.
The platform’s most successful week came in November 2024, when 1.67% of memecoins managed to transition to the open market. Despite this minor success, the overwhelming majority of tokens have struggled to survive beyond their initial stages.
Bobby Ong, CoinGecko’s founder, commented in a March 6 report on the cooling interest in memecoin investments, especially following a series of unfortunate launches, such as the infamous Libra (LIBRA) token. Ong noted, “The initial excitement surrounding memecoins has waned, and investors are becoming more discerning.”
A Shifting Landscape
The current state of the crypto market raises pertinent questions about the sustainability of these rapid token launches. While the ease of creation has democratized access to the crypto space, it has also led to an oversaturation of the market with low-quality projects. The sheer number of new tokens, coupled with the high failure rate, highlights the need for more stringent vetting processes and perhaps a more cautious approach from investors.
Looking forward, the market appears to be at a crossroads. Will the trend of rapid token creation continue, or will there be a shift towards more sustainable and robust projects? The answer remains uncertain, but what is clear is that the crypto world is undergoing a period of significant transformation.
As the industry grapples with these challenges, the focus may increasingly shift towards quality over quantity. With market participants becoming more discerning, the hope is that future projects will prioritize innovation and sustainability, potentially leading to a more stable and resilient ecosystem.
In the meantime, the crypto community will be watching closely, eager to see how this dynamic landscape evolves. The future of digital assets continues to be both unpredictable and intriguing, leaving open the possibility for both remarkable success stories and cautionary tales.
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This article is based on: Crypto token failures soar, with 1 in 4 launched since 2021 dying in Q1: CoinGecko
Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
