Cryptocurrency: Redefining the Future of Finance
Cryptocurrency: Redefining the Future of Finance
Cryptocurrency is a thriving ecosystem, quietly encroaching on conventional finance’s territory.
Over the last five years, Bitcoin users and transactions have averaged a growth rate of nearly 60% per year. Similarly, private and public investors have deepened their commitment to cryptocurrencies including Ethereum, Ripple (XRP), and Stellar—and a number of others across the industry.
Today’s infographic unpacks a cross-section of cryptocurrencies, stakeholders, and core applications across a sector that’s continuing to grow in importance.
The Evolution of Cryptocurrency
Cryptocurrency has erupted into a $200 billion industry, sparking a wave of global disruption.
At the heart of cryptocurrency is a rich history of innovation. It extends back to the 1980s with advances in the field of cryptography—eventually leading to the technology that forms encryption techniques designed to protect the network.
Since then, a series of key events have continued to shape the sector.
|2009||Satoshi Nakamoto mines the first Bitcoin on a decentralized network|
|2012||Ripple is founded
|2013||The price of a single Bitcoin reaches $1,000
|2015||Ethereum launches, introducing smart contracts into the crypto ecosystem|
|2017||Over 1,000 cryptocurrencies listed
|2017||Bitcoin's price rockets past $10,000, reaching a peak just shy of $20,000|
|2018||EOS offers a blockchain-based infrastructure for decentralized apps (DApps)|
Now, there are over 5,000 cryptocurrencies in circulation, with many built on innovative applications and use-cases as the ecosystem rapidly evolves.
The Value of Cryptocurrencies
Today, crypto offers cutting-edge advances that are diverse and transformative. In addition, it could also be considered an investment in tomorrow’s financial system—decentralized finance (DeFi).
DeFi is an emerging alternative financial system that is built on a public blockchain, which enables greater accessibility because anyone has the ability to connect to it. Additionally, transactions are publicly visible, enabling greater transparency across the system.
Here is a refresher on some of the practical advantages being applied across cryptocurrencies.
|Used for purchasing goods without the need of a trusted third-party|
|As the total supply of many cryptocurrencies are limited, this scarcity influences their value
|Digital money that is typically pegged to a currency or commodity, such as gold
|Cryptography, the technology behind crypto, can enable the anonymity of its owners
|Can empower those without access to a bank to enter the financial system
|Digital Gold||Bitcoin||Bitcoin shares similar attributes to money: a medium of exchange, unit of account, and store of value
|Decentralized Apps (DApps)||EOS|
|Enable individuals to create apps without a central authority, directly connecting the user and creator
The Key Players in the Crypto Landscape
The cryptocurrency ecosystem is growing rapidly. Worldwide, private and public actors recognize its potential across many domains.
Who are the primary participants in the field today?
- Institutional Investors
Harvard Endowment Fund, Crypto Hedge Funds
- Cryptocurrency Exchanges
- Banks & Finance
J.P. Morgan, Fidelity Investments, Swissquote
- Power & Utilities
- Central Banks
China, Sweden, Saudi Arabia
Crypto Valley Association, Global Digital Finance
The rising popularity of crypto is bolstering new policies and adoption, as evidenced by the many players trying to break into the space.
The Big Picture:
As crypto continues to gain momentum, its longer-term implications will come into focus. Crucially, its cryptographic foundation sets the stage for future advances in finance.
Anonymized transactions protect users data through cryptographic techniques
Providing a new financial model for 1.7B unbanked individuals around the world
Steep reductions in settlement time and efficacy could save consumers $16 billion annually
Providing immutable, traceable records of security-rich transactional networks
- Programmable Money
Smart contracts could drastically eliminate manual and administrative work— ultimately bypassing them altogether
Rooted in decentralized and autonomous systems, cryptocurrencies are creating second-order effects in the financial world. Ultimately, cryptocurrencies are helping to transform finance as we know it—unlocking countless investment opportunities across the global economy.
Charting the Number of Failed Crypto Coins, by Year (2013-2022)
We visualize over 2,000 crypto failures by year of death, and year of project origin. See how and why crypto projects die in these charts.
The Number of Failed Crypto Coins, by Year (2013-2022)
Ever since the first major crypto boom in 2011, tens of thousands of cryptocurrency coins have been released to market.
And while some cryptocurrencies performed well, others have ceased to trade or have ended up as failed or abandoned projects.
These graphics from CoinKickoff break down the number of failed crypto coins by the year they died, and the year they started. The data covers a decade of coin busts from 2013 through 2022.
What is the marker of a “dead” crypto coin?
This analysis reviewed data from failed crypto coins listed on Coinopsy and cross-referenced against CoinMarketCap to verify previous market activity. The reason for each coin death was also tabulated, including:
- Failed Initial Coin Offerings (ICOs)
- Abandonment with less than $1,000 in trade volume over a three-month period
- Scams or coins that were meant as a joke
Dead Crypto Coins from 2013 to 2022
While many familiar crypto coins—Litecoin, Dogecoin, and Ethereum—are still on the market today, there were at least 2,383 crypto coins that bit the dust between 2013 and 2022.
Here’s a breakdown of how many crypto coins died each year by reason:
|Abandoned / |
|Scams / |
|ICO Failed / |
|Joke / No
Abandoned coins with flatlining trading volume accounted for 1,584 or 66.5% of analyzed crypto failures over the last decade. Comparatively, 22% ended up being scam coins, and 10% failed to launch after an ICO.
As for individual years, 2018 saw the largest total of annual casualties in the crypto market, with 751 dead crypto coins. More than half of them were abandoned by investors, but 237 coins were revealed as scams or embroiled in other controversies, such as BitConnect which turned out to be a Ponzi scheme.
Why was 2018 such a big year for crypto failures?
This is largely because the year prior saw Bitcoin prices climb above $1,000 for the first time with an eventual peak near $19,000. As a result, speculation ran hot, new crypto issuances boomed, and many investors and firms got bullish on the market for the first time.
How Many Newly Launched Coins Died?
Of the hundreds of coins that launched in 2017, more than half were considered defunct by the end of 2022.
Indeed, a lot of earlier-launched coins have since died. The majority of coins launched between 2013 and 2017 have already become “dead coins” by the end of 2022.
|Coin Start Year||Dead Coins by 2022|
Part of this is because the cryptocurrency field itself was still being figured out. Many coins were launched in a time of experimentation and innovation, but also of volatility and uncertainty.
However, the trend began to shift in 2018. Only 27.62% of coins launched in that year have bit the dust so far, and the failure rates in 2019 and 2020 fell further to only 4.74% and 1.03% of launched coins, respectively.
This suggests that the crypto industry has become more mature and stable, with newer projects establishing themselves more securely and investors becoming wiser to potential scams.
How will this trend evolve into 2023 and beyond?
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