Recent research conducted by AlphaQuest Research has revealed that Cardano (ADA) has emerged as a leading ecosystem for defunct cryptocurrencies. The study, entitled “Cardano: Dead Coins King,” found that a staggering 74% of Cardano-based projects have ceased to exist.
To determine the status of a project as a “dead coin,” the researchers employed a rigorous set of criteria, including low trading volume, lack of liquidity, dormant or deleted accounts, and inactive websites. As per these criteria, blockchains with over 50% failed projects are classified as “dead.”
The study also highlighted that Terra experienced a similarly high failure rate of 74%. Furthermore, AlphaQuest observed that a significant majority of cryptocurrencies launched during the 2020-2021 bull market have subsequently become defunct, suggesting that 2021 was a challenging period for new crypto projects.
In addition to Cardano and Terra, the report identified several other blockchain ecosystems with a notable proportion of dead coins, including Harmony ONE, NEAR Protocol, Zilliqa, Celo, and Moonrive. “A substantial number of crypto projects have a short-lived existence, with 21.77% lasting less than a year and 11.65% lasting less than six months,” AlphaQuest stated. “Only 22.40% of crypto projects survive for more than four years.”
Avalanche Outage Benefits Cardano
Despite Cardano’s high failure rate, the network has gained attention amidst a recent outage experienced by rival blockchain Avalanche. The five-hour outage on Friday prompted Dan Gambardello, Founder of Crypto Capital Venture, to laud Cardano’s reliability and resilience.
Gambardello expressed optimism that institutions will recognize the significance of Cardano’s peer-reviewed research approach, which has contributed to its stable and reliable foundation. While Avalanche’s native token AVAX has declined by over 7% in the past week, Cardano’s ADA has experienced a modest gain of 1.5% during the same period.
Traders appear to be shifting their funds from Avalanche to Cardano in search of a haven during the volatility caused by the outage. Gambardello emphasized that Cardano has consistently maintained its position among the top ten cryptocurrencies and has proven itself to be a reliable option.
It is worth noting that low-latency blockchain Solana also experienced a five-hour outage earlier this month due to heavy congestion.
- Cardano has been identified as a leading ecosystem for dead or failed coins, with 74% of its projects ceasing to exist.
- Other blockchain ecosystems with high failure rates include Terra, Harmony ONE, NEAR Protocol, Zilliqa, Celo, and Moonrive.
- A significant majority of cryptocurrencies launched during the 2020-2021 bull market have become defunct.
- Avalanche’s recent outage has highlighted Cardano’s resilience and attracted traders seeking a safe haven.
Conclusion
Cardano’s prevalence of dead coins raises questions about the long-term viability of projects built on the network. However, the recent attention it has garnered amidst Avalanche’s outage suggests that Cardano’s research-driven approach and consistent performance may appeal to investors searching for stability and reliability.
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