Over 100 Crypto Projects Exit, Funds Shift to Infrastructure

The crypto market has transitioned from viewing the scale of fundraising as evidence of growth to entering a correction phase that assesses profitability and survival potential. In 2026, it was reported that over 100 projects have closed or filed for bankruptcy, highlighting a significant change in the funding environment.

According to CoinDesk, based on data from RootData, more than 100 crypto projects have either closed, filed for bankruptcy, or effectively disappeared this year. Ryan Kirkley, CEO of the Global Settlement Network, stated in an interview with CoinDesk that "raising funds at excessively high valuations guarantees negative outcomes."

Kirkley believes that the fundraising competition from 2020 to 2021 already contained elements of current failures. Projects with low revenue and weak paths to profitability announced large funding rounds, and the reaction of token prices and retail investor interest created a structure where the scale of fundraising replaced business viability.

In the crypto industry, large funding rounds and high valuations have typically been interpreted as signals of market confidence. However, business models reliant on token issuance and initial investments struggle to cover operating costs and user acquisition expenses when market liquidity decreases. This correction is seen as a process revealing the follow-up costs of past fundraising competition.

Funding has not completely dried up. Galaxy Research reported that in the first quarter of 2026, investments in crypto and blockchain startups amounted to $4 billion (approximately 5.656 trillion won), with 355 transactions recorded. While the investment amount decreased by about 50% compared to the previous quarter, the transaction count only dropped by 16%.

Galaxy Research explained that the decline in large funding rounds has exacerbated the overall drop in investment amounts. The same report noted that eight new crypto venture funds were formed, totaling about $1.1 billion (approximately 1.555 trillion won), the lowest level since the third quarter of 2020.

The key takeaway from the figures is not the extinction of investments but rather a change in the way funds are allocated. The fact that the investment amount has decreased more significantly than the transaction count suggests that fewer large rounds are occurring, and investors are more selectively assessing the survival potential of projects. Rather than initial investments disappearing, the conditions for capital raising have tightened.

The direction of funds is also changing. CoinDesk reported that Kirkley sees stablecoins, neobanks, and institutional wallet and payment infrastructure as relatively strong areas, while social tokens, meme coins, and some Web3 games may face greater pressure. This statement highlights differences in business models rather than price forecasts.

Stablecoins are cryptocurrencies designed to be pegged to fiat currencies like the dollar or the value of specific assets. Institutional wallet and payment infrastructure is closer to back-end systems that handle storage, settlement, identity verification, and anti-money laundering procedures rather than token trading.

The Global Settlement Network's business aligns with this trend. The company describes itself on its official site as a digital money, cross-border payment, and tokenization infrastructure provider for regulated entities. In a press release on May 6, the company announced a $11 million (approximately 156 billion won) pre-seed investment and $125 million (approximately 1.768 trillion won) in committed settlement liquidity.

However, this liquidity should be distinguished from actual execution amounts. Crypto.news reported on May 21 that in a recorded interview, Kirkley stated that no actual amount had moved from the $125 million committed liquidity. While the amount already settled on-chain exceeds $350 million (approximately 494.9 billion won), the commitment refers to funds that will be deployed in the future.

Movements in regulatory infrastructure are also being confirmed. The Global Settlement Network announced on April 30 that it joined the Canton Network as a validator and would distribute GSX IDs. The company explained that this service aims to reduce redundant checks between institutions by allowing KYC, AML, and investor eligibility verification to be reused on-chain.

As institutional participation increases, regulatory compliance becomes not just a supplementary function but a part of the business model. Financial institutions have a demand to process customer verification, anti-money laundering, and investor eligibility checks in a standardized manner rather than as separate repetitive procedures.

Kirkley viewed Bitcoin (BTC) as in a "weak bear market" during the CoinDesk interview and mentioned $61,200 (approximately 86.54 million won) as a key support level. He also noted the possibility of a move towards $41,000 (approximately 57.97 million won) if that level is breached. However, this is Kirkley's personal scenario and should not be interpreted as a consensus market outlook.

The crux of this correction is not whether crypto is disappearing. It is about which projects can prove cash flow, regulatory compliance, and actual payment demand. The previous method of attracting funds solely based on price or token narratives has narrowed significantly.