Dead Cryptocurrencies

List of Dead Cryptocurrencies

The emergence of cryptocurrency has been remarkable to witness. Indeed, it is a testament to the wonders of technology combined with market-relevant solutions. That said, the process an individual altcoin goes through to become a fully-fledged coin is long-drawn and painstaking.

Therefore, it shouldn’t come as a surprise that there is a whole lot of potential altcoins that never made it. The reasons are varied but their fate is the same. In fact, the total amount of lost value due to failure and hacking was just shy of $1 billion in 2017.

The list of dead cryptocurrencies 2017 alone is pretty staggering .The ICO process is particularly daunting because this stage essentially involves investors affirming their belief in a particular coin or vice versa.

Why Some Altcoins Fail

The list of failed cryptocurrencies is long and varied in causative reasons.  Research by Token data indicates that 46 percent of ICOs are confirmed to have failed in 2017 with 142 of the 902 crowd sales failing at funding stage. An even bigger number 276 have since failed.

Two reasons emerge from this description. One is that an ICO can fail for reasons of limited funding, falling short of the targeted hard cap. This is certainly understandable given the competitive funding channels available namely ICOs.

The second and arguably more devastating reason is various forms of fraud involving management. In some instances, the managers take away the money and run while others gradually fade into obscurity.

This is achieved through stopping communication on social media and such avenues that keep investors in the loop. Such events are naturally disappointing and have inadvertently increased skepticism in cryptocurrency generally. This is really unfortunate because an otherwise brilliant innovation is now almost synonymous to fraud for some.

List of Dead Cryptocurrencies

An actual list of failed coins for 2017 alone would run into the hundreds. In that regard, lets highlight about five which as a collective can give us the common thread in these failed coins. Through these well get the pretty grim opportunity cost that comes with digital currency failure.

1.     Coindash

Coindash was an Israeli based platform, which ran an ICO in 2017 to raise funds for development of a social cryptocurrency portfolio platform. A rather unfortunate incident happened right about the time the ICO was commencing. Hackers compromised the Coindash website and changed the Ether address to which investors sent funds.

By the time the defect was realized, about $ 9 million worth of Ether at the time had been stolen. This represented more than half of all funds raised. What came next was suspension of the ICO raising the issue of security which is a major theme in all of cryptocurrency.

2.     Veritaseum

This circumstances that saw the failure of this ICO are even more devastating. Veritaseum had indeed managed to successfully conduct its ICO in May 2017 for a decentralized trading platform. However, barely one month later, the founder Reggie Middleton announced that hackers had stolen $8.7 million worth of tokens by defeating the two factor authentication system.

This was crushing as the stock price plummeted by about $ 80 moments after the announcement. The platform was able to recover slightly but not enough to realize the rewards of a successful ICO.

3.     Swisscoin

This is a textbook case of fraud.  Ukrainian police uncovered an elaborate embezzlement racket that had made away with $ 500,000 worth of investors’ money through a fraudulent ICO. Swisscoin was blatantly a scam because there was no Whitepaper available during the ICO.  Investors therefore have to be keen on a coin’s development team and documentation for certainty.

4.     Tezos

Tezos marketed itself as digital commonwealth that verified transactions and executed smart contracts on the Ethereum blockchain. It had a very successful token sale but conflict in management brought about panic and a 75% decline within a day. This was not complete failure but effectively wiped away pretty much any success from the ICO.

5.     Slot N Slot

This is actually one of the more positive stories from the bunch. Slot N Slot was meant to be an autonomous gambling platform based on blockchain. However, the team faced some development challenges along the way and originality issues. With that in mind, the team opted to cancel the entire ICO other than defraud investors. This saw the demise of the project.

Conclusion

In conclusion, we can see that ICOs fail for different reasons. This has unfortunately been a bad look reputation-wise for the digital coin industry. That said, it has made investors more wary and developers more equipped not to repeat the mistakes of others.

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1 Comment

  1. Great Article Dalmas !

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