Everything you want to know about dead coins in cryptocurrency
The crypto craze is alive and kicking! At present, the internet is buzzing with digital currencies, NFTs, games, and much more in the crypto world! Parallelly, the count of ‘dead coins,’ a term given to the cryptocurrencies that don’t exist anymore, is increasing as well.
According to the report fromcoinopsy, the number of dead coins has grown 35% over last year to 1,949.
In fact, it all began in 2017 with the Initial Coin Offering (ICO). ICO is a type of capital raising process, similar to Initial Public Offering (IPO), to create a new cryptocurrency.
This has raised the number of options available from 29 to around 850 in 2017. As of March 3, 2021, there were 9,108 cryptos in circulation, as per CoinMarketCap.
How to identify dead coins?
A coin is considered dead if:
A coin is abandoned by developers or delisted.
Used as scam
No official websites or nodes
There are three types of dead coins:
Joke dead coins
These coins don’t have any concrete plan and will be launched for the sake of it. Notably, some crypto enthusiasts see some value and bet on them initially.
It’s worth noting that, UET (Useless Ethereum Token) raised around $300K (approx £218K) during ICO. However, for every meme/joke coin that makes it like Dogecoin, nine others fall flat. Among dead coins, around 3% accounts to joke coins.
Few examples: MonaCoin, JesusCoin, PayCon, AssPennies, CryptoMeth, ObamaCoin, and more.
Scam dead coins
As the name mentions, these coins are associated with scams. Some of the scams include run away with money, pump and dump, and massive pre-mine. Usually, it is better to avoid coins where the development team has a large portion of the coins.
Few examples: Machinecoin, Luckbox, Lotus, LoopX, Loligo, Lolcoin, and more.
Abandoned dead coins
This is the most common form of dead coins for numerous reasons, including developer death, loss of traction, limited funding, and removal from exchanges. Notably, every coin has to meet certain criteria to get listed in the exchanges; if it’s not met, it will be removed.
Few examples: Maecenas, Lucky7Coin, LOOIX, Locus chain, and more.
Is it possible to spot a dead coin beforehand? No, not really! It is always safe to keep a close check on the altcoins you’ve invested in through various forums and social media.