Crypto Market Shrinks by Over 100 Projects Amid Dot-Com Style Shakeout
The crypto market is experiencing a massive shakeout reminiscent of the dot-com bubble in the early 2000s, with over 100 projects folding up shop in 2026. Ben Fisch, CEO of Espresso Systems, attributes this to an oversaturation of general-purpose layer twos, which are essentially redundant versions of the same technology.
'We're in a consolidation phase for general-purpose layer twos, not layer twos broadly,' Fisch told CoinDesk. Industry leaders agree that the shakeout is a sign of a maturing market where capital is harder to raise and investors have become more selective.
Marek Olszewski, co-founder of the Celo layer-2, notes that consolidation is happening across all of crypto right now, from DeFi protocols to DEXs and infrastructure providers. 'The networks continuing through this period are the ones people actually use and depend on,' he said.
Nick Puckrin, founder of Coin Bureau, estimates that for every project that shuts down, there may be another 10 doing so quietly. 'Creative destruction for the next cycle perhaps,' he wrote in a post on X.