- Almost 1 million new crypto tokens were created last month.
- This rate of growth far exceeds anything seen before in the industry.
- There are doubts about the usefulness and quality of new projects.
As a niche offering, cryptocurrency has long suffered from an image of breeding scams, illicit financing, and speculative excess. However, despite these challenges, the industry has defied skeptics and grown into a multi-trillion-dollar market in 15 years. With legacy finance cautiously embracing digital assets, the path to mainstream acceptance and further growth looks assured.
As a demonstration of the industry’s remarkable growth trajectory, the number of new crypto tokens released in April topped almost one million, exhibiting the innovative spirit and entrepreneurial drive fueling the industry’s development.
New Crypto Tokens Explode in April
The number of newly created crypto tokens in April topped nearly 1 million, signaling an unprecedented surge in growth for the digital asset industry. Coinbase director Conor Grogan highlighted the scale of this growth, stating that the number of new crypto tokens created last month was twice that launched on the Ethereum blockchain between 2015 and 2023.
Grogan attached a chart from Dune Analytics illustrating the magnitude of the increase in new token offerings. It focused on Ethereum and several of its layer 2s only, with Base contributing the largest portion of new token additions by a considerable margin.
The growth of the cryptocurrency market can be attributed to increasing investor interest, both from retail and institutional players, as well as a growing acceptance of cryptocurrencies as alternative assets.
According to CoinMarketCap, there are now over 2.4 million crypto projects in existence, a remarkable feat considering the industry’s relatively short lifespan. However, despite the sheer quantity of crypto projects on the market, there is overwhelming doubt about the quality and utility of most of these tokens.
Quality Over Quantity
Chiming in on the matter, X influencer DonAlt expressed his doubts about the quality of tokens on the market, stating that 99.99% are doomed to fail. Echoing this sentiment, trader Dead Cat Bounce singled out the plethora of Solana-based “sh*tcoins,” criticizing them as existing primarily to scam investors and enrich the founders of these projects.
Two years ago, when the number of crypto tokens on the market stood at around 19,000, Ripple boss Brad Garlinghouse drew attention to the excessiveness of the situation, pointing out that there are only 180 fiat currencies worldwide.
With the current number of crypto tokens exceeding 2.4 million, over 120 times the figure from two years ago, it is fair to say that most of these tokens are simply cluttering cyberspace.
On the Flipside
- Off-the-shelf solutions to create crypto tokens exist, lowering the barrier to entry and contributing to token proliferation.
- As the industry matures, token projects with strong fundamentals and real-world use cases will rise to the top over the long term.
Why This Matters
The influx of one million new crypto tokens last month is a double-edged sword for the industry. On one hand, it signifies the immense interest and potential for innovation in the digital asset space. However, it also raises questions about the quality and utility of these tokens, the risk of market manipulation, and regulatory gaps.
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