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Crypto Insight
5 days ago
- Business
- Crypto Insight
What is a ghost chain? How to spot dead or dormant crypto projects
Ghost chains are blockchains that are technically operational but have little to no real-world usage, development, or community engagement. Common warning signs include stagnant developer activity, low transaction volume, inactive communities, and exchange delistings. Even well-funded or corporate-backed projects like Diem, KodakCoin, and Luna can fail if adoption and ecosystem growth stall. Investors and developers can avoid ghost chains by monitoring onchain activity, GitHub commits, token liquidity, and community health before committing resources. A ghost chain refers to a blockchain that, while technically still running, has been abandoned by its developers and community. These are sometimes called dead blockchain networks or dormant crypto projects. While the chain may once have had momentum or hype, over time, developer activity stalls, user engagement drops and transaction volume plummets. Gradually, signs of failure become noticeable: no recent updates, diminished user activity and minimal real-world utility. Seemingly, they may often be operational and active on the surface, but are devoid of any useful activity and appear to be fading into obscurity. Essentially, it's a blockchain that is technically alive but functionally dead. The rise of ghost chains stems from several overlapping factors. Often, the original developers or teams stop contributing, leaving repositories untouched for months. Eventually, the core development team ceases communication, roadmap updates stop and users migrate to more active ecosystems. Communities diminish and liquidity dries up. In time, the network becomes a ghost chain, disconnected from the vibrant user base it once hoped to attract. From once-promising Ethereum killers to obscure layer 1s, the crypto landscape is dotted with examples of such projects that lost steam after initial hype. Whether due to a lack of utility, community or funding, these chains now drift in the blockchain graveyard. Spotting the warning signs can help avoid being caught in a 'digital ghost town.' Did you know: In June 2024, Binance delisted WAVES, OMG Network (OMG), NEM (XEM), and Wrapped NXM (WNXM) due to low trading volume, weak liquidity and limited development activity, all symptomatic signs of chains drifting toward ghost status. Common traits of a ghost chain Not every declining blockchain qualifies as a ghost chain. However, several recurring indicators can help identify a project on the brink of irrelevance. These are the key signs of a failed project (or on its way to becoming one): Diminished developer activity: A lack of recent code commits, version releases or updates. A lack of recent code commits, version releases or updates. Inactive communities: Forums and social platforms show minimal or no engagement. Forums and social platforms show minimal or no engagement. Broken or outdated websites: Project information is stale and documentation is incomplete. Project information is stale and documentation is incomplete. Low onchain transaction volume: Only a handful of transactions occur daily, often automated or internal. Only a handful of transactions occur daily, often automated or internal. Exchange delistings and low trading volume: The native token of the chain may be delisted or exhibit extremely thin liquidity. These red flags often appear together in dormant crypto projects, where the utility of the token is questionable and user trust is eroded. How to investigate and identify ghost chains? To protect time, capital and resources, it is essential to proactively assess any blockchain before engagement. The table below lists some important questions that you must ask before engaging with a blockchain: Examine transaction data : Use public blockchain explorers to assess how frequently blocks are being produced and if users are actually sending transactions. If block explorers show minimal daily transactions or wallet activity, that's a big warning sign. Some chains process only a handful of transactions per day, with most blocks nearly empty. : Use public blockchain explorers to assess how frequently blocks are being produced and if users are actually sending transactions. If block explorers show minimal daily transactions or wallet activity, that's a big warning sign. Some chains process only a handful of transactions per day, with most blocks nearly empty. Check DApp activity : A thriving chain will have decentralized apps, DeFi protocols, NFT marketplaces and other smart contracts in use. If the ecosystem is barren, chances are it's not attracting builders or users and is on its way to decline. : A thriving chain will have decentralized apps, DeFi protocols, NFT marketplaces and other smart contracts in use. If the ecosystem is barren, chances are it's not attracting builders or users and is on its way to decline. Assess GitHub or repository updates : Check the project's GitHub to see if developers are still committing code and fixing bugs. If the last meaningful commit was six months before, then that may be a red flag and require further probing. : Check the project's GitHub to see if developers are still committing code and fixing bugs. If the last meaningful commit was six months before, then that may be a red flag and require further probing. Monitor social media and communication channels : Look for AMA sessions, dev updates or community-driven content. Telegram groups with no moderators, Discord with more bot spamming than users or X accounts that haven't posted in months — these are all signs of failed chains. If the community feels deserted, it probably is and is an important and easy red flag to notice. : Look for AMA sessions, dev updates or community-driven content. Telegram groups with no moderators, Discord with more bot spamming than users or X accounts that haven't posted in months — these are all signs of failed chains. If the community feels deserted, it probably is and is an important and easy red flag to notice. Review token performance : A plummeting token price with negligible trade volume often reflects broader abandonment. While price alone doesn't determine success, a token that consistently declines with no trading volume or liquidity is a problem. : A plummeting token price with negligible trade volume often reflects broader abandonment. While price alone doesn't determine success, a token that consistently declines with no trading volume or liquidity is a problem. Crypto events: Check for any active participation and presence of the chain in recent crypto events such as a booth, speaker discussion, meetups, etc. Consistent lack of the team to showcase its offerings is a sign of decline. Keep in mind that overpromising and weak or no delivery to match the initial hype is something to look for. 'The fastest chain,' 'Solana killer,' or '100,000 TPS' are some extravagant promises often made in the blockchain ecosystem but rarely delivered. If the roadmap is outdated and no updates are forthcoming, it might be time to move on. Did you know: Feathercoin, launched in 2013 by Peter Bushnell, the head of IT at Oxford University's Brasenose College, as a faster Litecoin alternative, garnered initial interest but largely became a ghost chain amid stiff competition and its own dwindling development, leading to an overall decline in interest. Ghost chain examples: Projects that lost momentum Several blockchain projects, once praised for innovation, have become ghost chain examples due to declining usage and visibility: While each project failed for different reasons, the common thread is clear: Without active ecosystems and sustained developer engagement, even the most well-funded blockchains can fade into obscurity. Did you know: Diem, Facebook's ambitious blockchain project formerly known as Libra, raised over $1.3 billion and secured backing from major firms like Visa and PayPal, yet it was abandoned in 2022 after intense regulatory pressure, making it one of the most high-profile corporate dead projects in crypto history. Risks and consequences of ghost chains The collapse or stagnation of blockchain networks has wider implications. These dead blockchain projects contribute to digital clutter networks running with no users, consuming resources and creating confusion for investors and developers. Major consequences include: Loss of investor capital due to token devaluation. Wasted development time and infrastructure. Decreased trust in newer blockchain initiatives. Beyond financial loss, ghost chains pose security risks. Abandoned domains, download links and legacy wallets can become phishing traps. Fraudsters may repurpose old smart contracts or resurrect historical data to deploy malicious code, deceiving users who reconnect with the chain expecting legitimacy. It's important to note that not all inactive crypto blockchains are permanently doomed. Some may see a revival with renewed community support, updates or rebranding. But this is an exception and not the norm. In the next bull cycle, new blockchains will rise, but only a few will stick. Knowing how to differentiate between a vibrant protocol and a ghost chain is one of the most valuable skills in the space today. Stay sharp, stay skeptical and always do your own research. Source:
AllAfrica
18-06-2025
- Business
- AllAfrica
When the AI hype wave crashes
In recent years, artificial intelligence (AI) has taken centre stage across various industries. From AI-generated art to chatbots in customer service, every sector is seemingly poised for disruption. It's not just in your news feed every day – venture capital is pouring in, while CEOs are eager to declare their companies 'AI-first.' But for those who remember the lofty promises of other technologies that have since faded from memory, there's an uncanny sense of déjà vu. In 2017, it was blockchain that promised to transform every industry. Companies added 'blockchain' to their name and watched stock prices skyrocket, regardless of whether the technology was actually used, or how. Now, a similar trend is emerging with AI. What's unfolding is not just a wave of innovation, but a textbook example of a tech hype cycle. We've been here many times before. The tech hype cycle, first defined by the research firm Gartner, describes how emerging technologies rise on a wave of inflated promises and expectations, crash into disillusionment and, eventually, find a more realistic and useful application. The Conversation, CC BY-ND Recognizing the signs of this cycle is crucial. It helps in distinguishing between genuine technological shifts and passing fads driven by speculative investment and good marketing. It can also mean the difference between making a good business decision and a very costly mistake. Meta, for example, invested more than US$40 billion into the metaverse idea while seemingly chasing their own manufactured tech hype, only to abandon it later. In 2017, blockchain was everyone's focus. Presented as a revolutionary technology, blockchain offered a decentralized way to record and verify transactions, unlike traditional systems that rely on central authorities or databases. US soft drinks company Long Island Iced Tea Corporation became Long Blockchain Corporation and saw its stock rise 400% overnight, despite having no blockchain product. Kodak launched a vague cryptocurrency called KodakCoin, sending its stock price soaring. These developments were less about innovation and more about speculation, chasing short-term gains driven by hype. Most blockchain projects never delivered real value. Companies rushed in, driven by fear of missing out and the promise of technological transformation. But the tech wasn't ready, and the solutions it supposedly offered were often misaligned with real industry problems. Companies tried everything, from tracking pet food ingredients on blockchain, to launching loyalty programs with crypto tokens, often without clear benefits or better alternatives. In the end, about 90% of enterprise blockchain solutions failed by mid-2019. Fast-forward to 2023, and the same pattern started playing out with AI. Digital media company BuzzFeed saw its stock jump more than 100% after announcing it would use AI to generate quizzes and content. Financial services company Klarna replaced 700 workers with an AI chatbot, claiming it could handle millions of customer queries. The results were mostly negative. Klarna soon saw a decline in customer satisfaction and had to walk back its strategy, rehiring humans for customer support this year. BuzzFeed's AI content push failed to save its struggling business, and its news division later shut down. Tech media company CNET published AI-generated articles riddled with errors, damaging its credibility. These are not isolated incidents. They're signals that AI, like blockchain, was being over hyped. There are three main forces at play: inflated expectations, short-term view and flawed implementation. Tech companies, under pressure from investors and media narratives, overpromise what AI can do. Leaders pitch vague and utopian concepts of 'transformation' without the infrastructure or planning to back them up. And many rush to implement, riding the hype wave. They are often hindered by a short-term view of what alignment with the new tech hype can do for their company, ignoring the potential downsides. They roll out untested systems, underestimate complexity or even the necessity, and hope that novelty alone will drive the return on investment. The result is often disappointment – not because the technology lacks potential, but because it's applied too broadly, too soon, and with too little planning and oversight. Like blockchain, AI is a legitimate technological innovation with real, transformative potential. Often, these technologies simply need time to find the right application. While the initial blockchain hype has faded, the technology has found a practical niche in areas like 'asset tokenization' within financial markets. This allows assets like real estate or company shares to be represented by digital tokens on the blockchain, enabling easier, faster and cheaper trading. The same pattern can be expected with generative AI. The current AI hype cycle appears to be tapering off, and the consequences of rushed or poorly thought-out implementations will likely become more visible in the coming years. However, this decline in hype doesn't signal the end of generative AI's relevance. Rather, it marks the beginning of a more grounded phase where the technology can find the most suitable applications. One of the clearest takeaways so far is that AI should be used to enhance human productivity, not replace it. From people pushing back against the use of AI to replace them, to AI making frequent and costly mistakes, human oversight paired with AI-enhanced productivity is increasingly seen as the most likely path forward. Recognizing the patterns of tech hype is essential for making smarter decisions. Instead of rushing to adopt every new innovation based on inflated promises, a measured, problem-driven approach leads to more meaningful outcomes. Long-term success comes from thoughtful experimentation, implementation and clear purpose, not from chasing trends or short-term gains. Hype should never dictate strategy; real value lies in solving real problems. Gediminas Lipnickas is lecturer in marketing, University of South Australia This article is republished from The Conversation under a Creative Commons license. Read the original article.
