Scam and Dead Crypto Project Launches: Who’s Behind the Numbers?
A recent report by 5Money and Storible has shed light on the nations behind the most dead and scam crypto projects. The study, which analyzed data from 1,544 cryptocurrency projects launched globally between January 2022 and October 2024, reveals that the United States, China, and the United Kingdom lead in scam and dead crypto project launches. In this analysis, we’ll break down the key points, explore the reasons behind these numbers, and examine the implications for the crypto industry.
The United States Tops the List
The United States takes the lead in scam crypto projects, with American founders behind 43% of all scam projects. This is attributed to the high number of crypto projects launched in the U.S., as well as high-profile implosions such as the collapse of FTX in 2022. The U.S. also tops the list for failed projects, accounting for 33% of the total.
China and the United Kingdom Follow
China and the United Kingdom follow closely, accounting for 8% and 7% of scam projects, respectively. While these numbers may seem relatively low compared to the U.S., they still represent a significant proportion of the total number of scam projects.
Russia and Switzerland: The New Players
Interestingly, Russia and Switzerland are emerging as new players in the scam crypto project space. Russian developers ranked the highest, with 24% of all projects launched by Russian developers turning out to be scams. Swiss developers ranked second, with 22% of projects scams.
South Korea: The Failure Capital
Meanwhile, South Korea has the highest rate of failed crypto projects, with 59% of its total projects classified as dead. This is a stark contrast to the U.S., which has a relatively lower failure rate of 33%.
The Need for Global Standards and Stricter Regulations
The study highlights the need for global standards and stricter regulations to address the prevalence of scams and failed projects. Regulators across the globe have already begun tightening their grip on the crypto industry, with the Financial Conduct Authority in the UK planning to finalize crypto regulations by 2026, and Singapore and South Korea introducing stringent consumer protection measures.
Implications for the Crypto Industry
The recent findings resonate with a February report by AlphaQuest, which revealed that over 70% of crypto projects launched during the 2020-2021 bull run were reported dead by early 2024. The report also notes that 2023 was the toughest year for the crypto sector in the 2020-2023 cycle, with almost 60% of the dead projects wiped out during that time primarily due to low liquidity and trading volume.
Actionable Insights and Predictions
Based on the analysis, here are some actionable insights and predictions:
- Increased regulatory scrutiny: The crypto industry can expect increased regulatory scrutiny from governments and financial authorities worldwide. This may lead to stricter regulations, licensing requirements, and enforcement actions against non-compliant projects.
- Greater emphasis on due diligence: Investors and project participants will need to conduct more thorough due diligence on projects and founders to avoid falling victim to scams and failed projects.
- Emergence of new players: Countries like Russia and Switzerland may become new players in the scam crypto project space, highlighting the need for global cooperation and information sharing to combat these threats.
- Continued market volatility: The crypto market is likely to remain volatile, with continued fluctuations in prices and market capitalization. This may lead to increased failures and scams, particularly in countries with weaker regulatory frameworks.
In conclusion, the recent report by 5Money and Storible provides valuable insights into the nations behind the most dead and scam crypto projects. The findings highlight the need for global standards and stricter regulations, increased regulatory scrutiny, and greater emphasis on due diligence. As the crypto industry continues to evolve, it’s essential for participants to stay informed and adapt to these changing dynamics.
