Recent data from blockchain security firm CertiK has revealed a noteworthy slowdown in the creation of new cryptocurrencies, with the pace now reaching its slowest in three years.
Citing data shared by CertiK, CoinDesk on Wednesday reported that the third quarter witnessed the creation of the fewest new tokens since the beginning of 2021.
The data set was compiled using information from CoinMarketCap, with memecoins—speculative tokens without clear use cases—excluded from the calculations.
In the third quarter this year, only 293 new tokens were added, a decline from 366 in the previous quarter and 449 in the same period a year ago, the report said.
The decline is particularly stark compared to the peak of the crypto bull market in the fourth quarter of 2021 when CoinMarketCap data showed that 1,261 new tokens were launched.
Aligns with industry trend
The findings align with other reports that highlight the challenges faced by the crypto industry during last year’s market downturn.
For instance, a report from Mike Novogratz’s digital asset management firm Galaxy Digital earlier this year said the environment for crypto venture capital funding remains “extremely challenging,” after what had then been five consecutive quarters of decline in funding.
Back then, the firm said the investment amount marked the low for the current cycle, and also the lowest amount that has been invested on a quarterly basis since Q4 of 2020.
The environment for crypto VC fundraising remains “extremely challenging,” Galaxy Digital said at the time.
‘A sign of crypto winter’
Commenting to CoinDesk on the slower pace for token launches, CertiK co-founder Ronghui Gu suggested that the slowdown in new token launches might signify a broader trend of cautiousness within the industry.
“It may still be a sign of crypto winter where everyone has paused developing and launching, waiting for the arrival of spring,” the CertiK co-founder and assistant professor of computer science at Columbia University was quoted as saying.