5 Failed Cryptocurrencies and Why They Were Unable to Survive
Added: (Fri Apr 14 2023)
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Cryptocurrencies have certainly taken the world by storm, with Bitcoin reaching unprecedented popularity and value over the years. Nevertheless, for every success story, there are some who never make it past the starting line. Many cryptocurrencies begin with great promise, generating a lot of publicity and raising a significant amount of starting capital, only to plummet spectacularly or fade quietly into obscurity. In this article, we’ll look at some of the failed cryptocurrencies and share what went wrong.
The Rise and Fall of These Failed Cryptocurrencies
BitConnect (BCC)
BitConnect is a cryptocurrency that launched in 2016. It was one of the top-performing coins of 2017, according to CoinMarketCap, and reached an all-time high in December. But in a matter of months, its value had plummeted. Aside from other incentives, its marketing campaign boasted daily profits of 0.5% to 1%, but it turns out it was another pyramid scheme. According to a report, BitConnect operated as a Ponzi scam by rewarding its early investors with funds from those who invested much later. An investigation carried out by the United States Department of Justice stated that its digital currency, BCC, had its value artificially inflated to create a false impression of real market demand.
PayCoin
Josh Garza founded Paycoin in 2014 with the forecast that it would take the cryptocurrency industry by storm. Paycoin never caught on, despite Garza’s claims that it would increase in value to $20 in a few months. Following a fraud accusation, Garza got a 21-month prison term. The demise of PayCoin was popular since its founders, John Garza and GAW, were experienced miners and cryptocurrency experts. Due to the digital currency’s hurried development and lax security, which they did in an effort to amass a sizable user base swiftly, this coin has since failed.
Dogecoin
Software developers Jackson Palmer and Billy Marcus created the coin in late 2013. Palmer used a joke from the period that contained the purposefully misspelled word “doge” to refer to a Shiba Inu dog to brand the cryptocurrency’s logo. Because of its charitable nature, the cryptocurrency gained popularity, a sizable user base, and status as a legitimate coin for transactions. Unfortunately, the founder unexpectedly shut down the exchange.
OneCoin (ONE)
OneCoin is a cryptocurrency that failed because it was a Ponzi scheme. The organizations responsible for the scheme were OneCoin Ltd. and OneLife Network Ltd., both of which Ruja Ignatova, a citizen of Bulgaria, founded. Ruja Ignatova vanished in 2017, and Sebastian Greenwood, the coin’s co-founder, was arrested and incarcerated in the United States. Unfortunately, they had already raised $4 billion before people realized what was happening.
DAO
The unveiling of the DAO in April 2016 made quite a stir in the crypto industry. The DAO was a big success because it was the largest crowdfunding ever, which raised $168 million USD. Once listed, the coin soon garnered market traction, reaching a high of 0.19 USD. Nevertheless, the glory was short-lived as an attacker exploited a weakness, resulting in a loss of more than $50 million USD. Traders subsequently dumped the DAO token, causing its price to plummet.
Takeaways
The cryptocurrency world is fraught with dangers and uncertainty. While some cryptocurrencies have skyrocketed in value, others have tanked severely. Before investing in any cryptocurrency, it is critical to conduct research and be informed of the risks involved.