Millions of crypto tokens exist, but few have value, warns Cardano founder

Cardano founder Charles Hoskinson warns of a difficult year for cryptocurrencies, predicting "disappointing" developments, business failures, and developers leaving the ecosystem. His outlook comes as a popular analytics platform ceases operations.

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I suspect there will be repeated failures

"I suspect there will be repeated failures" of similar ventures, Hoskinson stated. "This year will be very difficult." His pessimism reflects a reality overshadowed by Bitcoin's recent slump. The world's largest cryptocurrency fell more than 6% on Friday, briefly dipping below $60,000. It has lost about 17% this month, reaching its lowest point since 2024.

Several factors contributed to the decline: Michael Saylor's Strategy Inc. sold some of its Bitcoin holdings, Bitcoin exchange-traded funds continue to see outflows, and fears that the US Federal Reserve might raise interest rates further weighed on sentiment. High-risk investment assets generally faced pressure, with over $1.7 billion in digital assets liquidated within 24 hours.

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This year will be very difficult.

"Cryptocurrencies have lost the charm of being 'new and exciting' and are now just another asset class, another investment tool among countless options," commented Michael Antonelli, market strategist at Robert W. Baird & Co. However, while Bitcoin retreats, a deeper crisis is unfolding in much of the rest of the crypto market, according to Bloomberg. Hundreds of once-promising projects have faded, and billions of dollars have vanished.

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Cryptocurrencies have lost the charm of being 'new and exciting' and are now just another asset class, another investment tool among countless options

"Altcoins have generally been hit harder than Bitcoin recently, although the consequences have not been evenly distributed," said Thomas Probst, analyst at research firm Kaiko. Zcash, for example, risked losing over half its value after reports of a potential security gap. The crypto boom was fueled by technologies that drastically lowered barriers to creating new digital assets, transforming what once required developing an entire blockchain system into simply deploying a standard smart contract. This led to the creation of millions of tokens. Currently, fewer than 1,700 tokens show substantial daily trading activity out of tens of millions created in recent years, according to Delphi Digital.

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Altcoins have generally been hit harder than Bitcoin recently, although the consequences have not been evenly distributed