The blockchain space constantly births new projects, presenting a vast blue ocean of opportunity. Yet, only a few achieve lasting success. Many once-popular projects, after their hype faded, have become mere ripples in the vast digital sea. However, their contributions remain valuable, offering crucial lessons for future innovators.
This article reviews several promising projects that emerged around the 2018 bear market but ultimately fell short of their potential. We will examine the stories of Bitcoin Cash, Ethereum Classic, NEO, EOS, and Dfinity's Internet Computer.
Bitcoin Cash (BCH)
Bitcoin Cash (BCH) is both a payment network and a cryptocurrency. As of March 9th, it ranked 27th by market capitalization. Born from a hard fork of the Bitcoin blockchain in August 2017, BCH reached its all-time high of $3,923 per coin on December 23rd, 2017. Its price has generally followed a similar volatility pattern to Bitcoin (BTC).
Bitcoin Cash was created to increase Bitcoin's 1MB block size limit. It has since achieved a maximum block size of 32MB, allowing it to process more transactions per second with lower fees than BTC. Despite these technical improvements, BCH's market capitalization has never surpassed that of Bitcoin.
Why It Didn't Succeed
BCH continued to pursue Satoshi Nakamoto's original vision of a peer-to-peer electronic cash system, focusing on use cases like cross-border payments. Meanwhile, BTC evolved into a primary store of value, often dubbed "digital gold," with its payment functionality diminishing. The inherent value associated with a store of value vastly exceeds that of a pure payment network, which inherently limited BCH's potential.
Beyond its positioning, BCH's struggle to gain ground post-2018 can be attributed to macroeconomic factors like Federal Reserve interest rate hikes and a declining stock market. It missed its best window to challenge BTC.
With a new bear market looming and various political factors at play, BTC may face renewed downward pressure. Some believe BCH, as a peer-to-peer payment system, could see increased demand for transactional use, potentially making it the "next big thing," similar to current narratives around other payment-focused cryptocurrencies. For those tracking such market shifts, 👉 monitor real-time crypto analytics can be crucial.
Ethereum Classic (ETC)
Just as BTC had its hard fork, Ethereum also has a sibling network: Ethereum Classic (ETC). Despite combining ETH's technology with Bitcoin's philosophical ideals, it has failed to challenge Ethereum's dominance.
The Ethereum hard fork occurred in July 2016 to recover assets stolen from TheDAO. Founder Vitalik Buterin proposed the hard fork, resulting in two chains: Ethereum (ETH) and Ethereum Classic (ETC).
ETC, currently ranked 34th by market cap, maintained the original Ethereum chain's vision, promoting a higher degree of decentralization and community governance. However, it was only supported by 15% of the original network's hash rate. Today, its token price and ecosystem are far behind Ethereum's.
Why It Didn't Succeed
From the outset, the original Ethereum founders and core development team supported and led the new Ethereum chain. A new team took over Ethereum Classic.
At the time of the fork, 85% of the network's hash power supported the new Ethereum chain, indicating significantly greater demand and support.
Ethereum has become the leader in Total Value Locked (TVL) among public blockchains, while very few projects have been deployed on Ethereum Classic.
Consequently, even though ETC adhered more strictly to original decentralized ideals, it ultimately failed to become a major force in the blockchain world.
NEO
NEO, originally known as AntShares, is a public chain launched in China in 2014 by Da Hongfei, Zhang Zhengwen, and their team. It went open-source on GitHub in 2015 and raised capital through an ICO. NEO supports its own cryptocurrency, digital assets, and smart contract development, claiming to handle thousands of transactions per second. Its token, NEO, became known as a "thousand-fold coin."
NEO's price surged dramatically from an initial $0.08 to an all-time high of $198.38 on January 15th, 2018—a gain of over 2,478%. However, this proved short-lived. Data clearly shows a consistent downward trend, with the current price around $21.27.
Why It Didn't Succeed
The former thousand-fold coin has fallen to rank 77th in market cap. This wasn't solely due to poor market conditions but stemmed from internal issues within NEO:
- Poor Code Updates: Development and code updates slowed significantly.
- Stagnant Ecosystem: Ecosystem growth virtually halted.
- Weak Decentralization: Only 7 voting nodes exist, all deployed by NEO officially.
Without a solid foundation, the project is vulnerable. Unless NEO addresses these core issues, it risks being continually surpassed, especially during new bear market cycles.
EOS
In May 2017, block.one launched EOS as a smart contract platform and decentralized operating system. It quickly became a strong competitor to Ethereum, the reigning "king of public chains" in 2018. At the time, Ethereum faced criticism for network congestion, high gas fees, and delays in implementing sharding technology.
EOS entered the fray with a promise of feeless transactions and extremely fast processing speeds. Within six months of launch, it boasted 30,000 daily active users, dwarfing Ethereum's 3,000, earning it the title "Ethereum Killer."
Why It Didn't Succeed
1) Essentially a Centralized Chain:
The young "killer" ultimately failed to dethrone the king, defeated by its own design. EOS achieved its high speed by sacrificing decentralization. Its consensus mechanism relied on just 21 Super Nodes to process transactions, preventing smaller operators from participating. These nodes were elected by token holders, introducing risks of vote buying.
While Ethereum's and Bitcoin's Proof-of-Work (PoW) is inefficient, EOS's Delegated Proof-of-Stake (DPoS) is highly efficient. However, the core of blockchain is decentralization. EOS essentially functioned as a centralized chain, preventing it from leading in a decentralized world.
2) Weak Ecosystem, No Killer App:
Most top active chains have flagship applications or hot protocols sustaining their growth (e.g., Anchor on Terra). EOS had none. Although some projects deployed on it, none gained significant traction.
Furthermore, despite repeated official promises to support ecosystem development, the EOS chain remained underdeveloped—a veritable wasteland—as of March 9th. This meant the EOS token's value lacked real utility, making it prone to collapse.
Dfinity / Internet Computer
Dfinity is a decentralized cloud technology platform founded in 2016. It gained significant venture capital interest, remarkably securing a $102 million investment from a16z during the 2018 bear market—a16z's largest investment that year.
Dfinity's vision was to create a public cloud computing platform more efficient, secure, and usable than AWS, controlled by a distributed network of computers. Its "Internet Computer" was initially slated for late 2018 or early 2019 but finally launched its Alpha mainnet in December 2020.
Why It Didn't Work
Dfinity took over two years from funding to deliver a product, which was not unique or scarce in the market. The team's progress was too slow.
- Regarding the goal of a "blockchain AWS," Alchemy—providing blockchain development platform services for Web3 developers—was already founded in 2017 and now powers most global blockchain products.
- For publishing all source code to the public domain, GitHub, established in 2008, is the platform used by the vast majority of blockchain protocols for source code hosting.
- Community autonomy for token management had already been implemented in numerous other projects.
While Dfinity's conceptual design was highly attractive and decentralized, there was a vast gap between theory and execution. The repeated delays in launching the Internet Computer eroded market trust. To 👉 explore successful development strategies for blockchain projects, learning from both successes and failures is key.
Key Takeaways and Reflections
The blockchain world, though intangible, resembles a rapidly spinning, undeveloped planet. It offers equal opportunity for all explorers, but success is rare and follows no single blueprint. From the experiences of these five projects that came close to success, we can derive several lessons:
- Timely Execution: Solutions addressing blockchain's problems must be delivered promptly to stay relevant.
- Prioritize Decentralization: Avoid excessive centralization; strive to build truly decentralized networks.
- Balanced Governance: Unlimited freedom isn't true freedom, and absolute democracy is often impractical. Approach community governance carefully and maintain a balanced power structure within democratic designs.
Frequently Asked Questions
What is a hard fork in blockchain?
A hard fork is a radical change to a blockchain's protocol that makes previously invalid blocks and transactions valid, or vice-versa. This requires all nodes or users to upgrade to the latest version of the protocol software. It often results in a permanent divergence from the previous version of the blockchain, potentially creating a new cryptocurrency, as seen with Bitcoin Cash and Ethereum Classic.
Why is decentralization so important in blockchain?
Decentralization is the core principle of blockchain technology. It eliminates the need for a central authority, distributing control across a network of computers. This enhances security (as there's no single point of failure), increases censorship resistance, and promotes trustlessness, where participants don't need to trust each other but can rely on the network's protocol.
What typically causes a promising crypto project to fail?
Failure can stem from multiple factors: slow development and missed deadlines, an inability to solve a real-world problem effectively, excessive centralization, a weak or non-existent ecosystem of applications, poor tokenomics, or simply being outpaced by more agile competitors. Often, it's a combination of these issues.
How can investors identify potentially sustainable blockchain projects?
Look for projects with a strong, active development team, a clear and necessary use case, a commitment to meaningful decentralization, a growing and engaged community, healthy tokenomics that incentivize network participation, and a robust ecosystem of applications being built on the platform.
What is the significance of Total Value Locked (TVL) for a blockchain?
TVL represents the total amount of assets deposited in a blockchain's decentralized applications (dApps), primarily in decentralized finance (DeFi) protocols like lending platforms and exchanges. It's a key metric for gauging the health, adoption, and utility of a blockchain's ecosystem. A high TVL generally indicates strong user trust and activity.
Are there any successful projects that learned from these earlier failures?
Yes, many newer projects have incorporated these hard-learned lessons. They often emphasize faster iteration, stronger community-led governance models from the start, and a clearer focus on achieving true decentralization while ensuring developer-friendly environments to build a vibrant ecosystem quickly.