In the 2019 bear market, a large number of crypto projects faded from view. But combing through data about defunct projects on DeadCoins.com, we found something interesting. According to that site at least, 2019 saw fewer blockchain project deaths than 2018.
DeadCoins.com includes data on 1,840 crypto projects that have died since September 2017. According to that dataset, in 2019 a total of 518 projects died, which is 20% less than the 647 projects that died in 2018.
How did these projects die? DeadCoins.com divides projects into four categories: Deceased, Hack, Scam and Parody. The majority of dead projects were categorized as scams. In 2019 and 2018, 58% and 55% of the projects fell into this category, respectively. “Deceased” projects accounted for 35% in 2019 and 38% in 2018, and the rest died from hacks or plagiarism.
The causes of blockchain project deaths in 2019 and 2018 were similar, proportionally. We did more in-depth analysis on what kills crypto projects here.
In 2019, most blockchain projects died in the first quarter. One hundred and fifteen, 48, and 120 projects died in January, February, and March, respectively, accounting for more than half of the year's total deaths. In the second quarter, just 83 projects died. This difference might be explained by broader market forces, as Bitcoin and other crypto asset prices rose steadily throughout most of the second quarter.
According to blockdata.club, there were 4,292 new blockchain projects in 2017, 13,168 in 2018, and 2,160 in 2019 as of May. Most scam projects have a project life cycle of less than one year, and legitimate projects that fail generally have a life cycle of 1 to 3 years. The number of ICO projects in 2019 fell sharply from March according to ICObench, and the number of IEO projects is several orders of magnitude smaller than the number of ICOs.
In 2019, more military and enterprise blockchain projects emerged, and the overall project quality was higher than in 2018, according to Deloitte’s 2019 Global Blockchain Survey.
So what can we expect in the future? It all depends on the market, of course. But due to the large number of projects launched in 2018, many of which were ICOs, we can expect to see a steady continuation of project deaths over the next year or two.