May 23, 2023
By Murtuza Merchant
In the fast-paced realm of digital currencies, an increasing number of novel crypto projects are launched annually.
However, a significant portion struggles to make an impact and end up disappearing into obscurity. The value of their tokens dwindles, often to near worthlessness.
A multitude of reasons contribute to these failures, and a predominant one is the inability to attract and retain users. This write-up explores nine factors why numerous crypto ventures are unable to captivate users.
Unmemorable and Confusing Naming
When it comes to cryptocurrency names like HalloweenShibaZilla, PummpshibaXX, and Shibadogebitcoin Inu, the complexity and obscurity can be baffling. While uniqueness is essential in the saturated market, the chosen names should be easy to recall and spell, especially considering the global nature of the crypto sphere.
Lack of Clear and Precise Project Information
An often observed downfall is the projects’ failure to effectively convey their purpose to potential users. Ambiguous statements like “built by the people for the people” may sound appealing but do little to elucidate what the project truly represents. To attract and engage users, the project’s website and other resources must offer precise and readily accessible information about the problem the project aims to solve.
Overly Complex Website Design
A good website should be user-friendly and efficient, not just visually striking. However, many projects make the mistake of incorporating extensive, intricate animations that are slow to load and do little to enhance understanding. Such complexities could potentially deter users with average internet speeds and reduce engagement time.
Overestimating User Familiarity with Technology
Cryptocurrency users make up only around 4.2% of the global population. Crypto projects that assume widespread tech-savvy among users often fail to provide the essential foundational information necessary for new adopters. Detailed, easy-to-understand tutorials, documentation, and FAQs are crucial for promoting understanding and adoption.
Launching at Inopportune Times
Market timing plays a crucial role in the success of a crypto project. Launching a new coin or token during a bear market generally yields poor results due to a decrease in active investors. Thus, timing matters significantly, sometimes even more than the quality of the project itself.
Neglecting Community Building and Engagement
The importance of a strong and active community cannot be overstated for a crypto project’s success. However, many fail to prioritize this, resulting in a lack of engaging content and timely responses to community inquiries. A strong community can buoy even mediocre projects to top positions.
Absence of a Real Use Case
Many new projects fail to provide a unique value proposition or solve an existing problem, making it hard for them to stand out and attract users. Just like with the numerous NFT projects tracked by Coingecko, new entrants will struggle to make a mark unless they offer a significant advantage or have powerful partnerships.
Unfriendly User Experience
Despite advancements in design standards, many new crypto projects still offer a subpar user experience. From complex wallets and key management to poorly designed platforms, users are often left to navigate confusing interfaces. Attempts to simplify the user experience often result in corner-cutting and over-centralization, contradicting the spirit of decentralized cryptocurrencies.
Lapses in Security and Risk Management
Security breaches have detrimental effects on crypto projects, especially new ones. Incidents of hacking not only lead to a sharp fall in token value but also, more often than not, prevent recovery in the long term. Thus, poor risk management and security issues can spell doom for nascent crypto ventures.
About the author
Murtuza Merchant is a senior journalist and an avid follower of blockchain and cryptos.