A wave of failures on a previously unimaginable scale has swept over the crypto market at the start of 2025, with a record 1.8 million tokens collapsing during the first quarter. That is almost 25% of all crypto tokens issued since 2021, says a report by crypto information platform CoinGecko.
A Quarter Of All New Crypto Tokens Collapsed In First Three Months Of 2025
The meltdown has significantly impacted a massive portion of the crypto market. According to CoinGecko research analyst Shaun Paul Lee, of the almost 7 million cryptocurrencies listed since 2021, over half (3.6 million) have ceased trading entirely. The mortality rate has surged significantly from earlier years.
The first three months of 2025 experienced more token failures than any calendar year on record, Lee noted in his April 30 report. This figure is especially noteworthy compared to the entire span from 2021 through 2023, which represented only 12.6% of all cryptocurrency failures in the last five years.
Trump’s Presidency And Market Turbulence Linked To Crypto Demise
The report highlights that the recent surge in token casualties coincides with widespread market volatility following Donald Trump’s inauguration as US President in January. During this period, Bitcoin reached an all-time high but was subsequently followed by a steep decline in crypto markets.
The situation worsened in March, when cryptocurrency and equity markets experienced unprecedented volatility, driven by Trump’s threat to implement sweeping tariffs, which sent shockwaves across multiple financial markets.
Easy Token Creation Tools Caused Market Flooding
The record surge in token failures began back in January 2024, with the emergence of an easy token creation tool known as Pump.fun. This platform made it extremely easy to create new cryptocurrencies, resulting in a deluge of memecoins and subpar projects flooding the market.
In 2024 alone, over 3 million new crypto tokens were launched—almost four times the amount of 2023, which saw just over 835,000 new additions. Before the arrival of Pump.fun, cryptocurrency failures were relatively uncommon, with numbers remaining in the “low six digits,” Lee’s analysis reported.
Almost All Pump.fun Tokens Fail To Graduate To Open Market
The statistics reveal that approximately 98% of tokens minted on Pump.fun do not survive to see the open market. Even during the platform’s most successful week in November 2024, only 1.67% of memecoins achieved successful transition to the open market.
CoinGecko founder Bobby Ong pointed out in a March report that investor interest in memecoins seems to have waned following a series of failed launches. He specifically mentioned the fallout from the Libra (LIBRA) token launch as a contributing factor.
Despite Pump.fun reaching its peak weekly trading volume following the launch of Trump’s memecoin on January 18, the resulting market volatility appears to have dampened enthusiasm within the crypto landscape.
The convergence of simplified token creation tools and erratic market conditions has created a perfect storm for cryptocurrency failure, with no indications that this troubling trend will abate as we move forward into 2025.
Featured image from Gemini Imagen, chart from TradingView
