Crypto Project Shutdowns Accelerate as Boom-Era Funding Models Unravel
Crypto project shutdowns have accelerated this year as weak token prices and shrinking treasuries expose business models built during the industry's funding boom. More than 100 crypto projects have shut down, filed for bankruptcy or effectively disappeared in 2026, according to RootData figures cited by CoinDesk.
Ryan Kirkley, CEO of Global Settlement Network (GSN), blames excessive fundraising and high valuations during the 2020-21 crypto boom. 'If you raise at too high a valuation, you guarantee yourself a negative outcome,' Kirkley said.
Kirkley also questioned decentralized governance models, arguing that token ownership does not guarantee meaningful participation. Governance votes can slow decision-making when struggling protocols need to pivot quickly.
The market is shifting towards stablecoins, neobanks, institutional wallets, and blockchain settlement infrastructure. Memecoins, social tokens, and some Web3 gaming projects face greater pressure.