After a period of intensive investment in the cryptocurrency sector in 2020 and 2021, the process of weeding out projects is reportedly accelerating. Ryan Kirkli, CEO of Global Settlement Network (GSN), stated that projects which achieved high valuations but failed to create a sustainable revenue model are beginning to leave the market.
According to Kirkli, since the beginning of 2026, more than 100 cryptocurrency and blockchain projects have ceased operations, declared bankruptcy, or effectively disappeared. This trend in the sector is largely attributed to the investment frenzy of 2020-2021.
Kirkli noted that during this period, numerous startups raised significant amounts of capital at high valuations, but a substantial portion of these projects failed to develop a business model that would generate real revenue or profit. The fact that these companies constantly relied on new investment rounds to survive, combined with tightening capital markets, has further exacerbated these issues.
According to data from Galaxy Research, the volume of venture capital investments in the cryptocurrency and blockchain sector in the first quarter of 2026 reached approximately $4 billion. During this period, 355 investment deals were concluded. Although the total investment volume nearly halved compared to the fourth quarter of 2025, the decrease in the number of deals was only 16 percent.
This data shows that the funding shortage in this sector is largely driven by a reduction in investment rounds with very high valuations.
Kirkli believes that some cryptocurrency sectors may strengthen following the ongoing market cleanup. He specifically noted that stablecoin projects, digital banks, institutional wallet services, as well as payment and settlement infrastructures may stand out in the near future.
In contrast, he stated that social token projects, meme coins, and some web-gaming startups may face greater pressure.
Kirkli also noted that interest in blockchain persists from both the corporate and government sectors. Having stated that he met with representatives from the governments of seven different countries in the past month, the GSN CEO said that the interest of governments and large institutions is shifting from the traditional decentralized finance approach in the crypto sector to use cases such as reducing financial costs, asset tokenization, and cross-border payments.
He Pointed to a Level of $61,200 for Bitcoin.
Kirkli, who also assessed the Bitcoin market, characterized the current outlook as a "moderate bear market."
According to Kirkli, the $61,200 level is a critically important support level for Bitcoin. He stated that if the price falls below this level, funds using leverage may be forced to sell, and such a scenario could accelerate Bitcoin's decline.
In the analyst's view, a break below the $61,200 support level could open up a broader downtrend for Bitcoin towards the $41,000 level.
*This is not investment advice.
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