Scams and Failed Crypto Projects: A Global Analysis

Between 2022 and 2024, a significant number of cryptocurrency projects have failed, with an estimated 43% of all scam projects originating from the United States. Experts have analyzed data from 1,544 cryptocurrency projects launched globally during this period to identify the countries with the highest rates of scams and failed projects.

Nations with the Highest Rate of Scam Crypto Projects

According to a study by 5Money and Storible, the United States tops the list, with American founders behind 43% of all scam projects. China and the United Kingdom follow, accounting for 8% and 7% of scam projects, respectively.

The study suggests that scams and failed projects are more common in countries with strong market growth. Russia 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, followed by Chinese developers at 20%.

Nations with the Highest Rate of Failed Crypto Projects

South Korea has the highest rate of failed crypto projects, with 59% of its total projects classified as dead. Singapore closely followed with 54%, while over half of projects in the United Kingdom also failed. Canada and the Netherlands recorded a 50% failure rate.

Need for Global Standards and Stricter Regulations

The study emphasizes 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 in a bid to ensure economic stability and bolster investor protection.

Regulatory Efforts

For instance, the Financial Conduct Authority in the UK plans to finalize crypto regulations by 2026, while Singapore and South Korea have introduced stringent consumer protection measures. These efforts aim to mitigate the risks associated with the crypto industry and provide a safer environment for investors.

Industry Trends

According to a February report by AlphaQuest, over 70% of crypto projects launched during the 2020-2021 bull run were reported dead by early 2024, with 30% shutting down shortly after FTX filed for bankruptcy. 2023 was cited as 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.

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