Over 60 cryptocurrency firms and projects have either folded or declared bankruptcy in the first seven months of 2026. The wave accelerated sharply in July with major names citing a range of reasons from security breaches to regulatory hurdles. BitMEX, once a pioneer in crypto derivatives, confirmed its plans to close by late September, marking one of the most high-profile exits this year.
The crypto industry has been under immense pressure since Bitcoin's sharp drop from its October 2025 peak. The softer market has tightened company budgets, slowed hiring, and forced many firms to lay off staff or halt funding rounds entirely. This contraction has hit all corners of the space: exchanges, blockchains (both layer one and layer two), wallets, NFT marketplaces, blockchain games, and decentralized finance projects.
Cracks in the Industry's Foundation
Security incidents played a significant role in many closures. Step Finance suffered a $40 million hack, while Radiant Capital was hit by a $50 million breach back in 2024, both contributing to investor and user confidence erosion. Licensing and regulatory challenges also blocked companies like AscendEX, which cited a failed attempt to obtain EU MiCA approval and collapsed liquidity partnerships as reasons for shutdown. Tally’s founder blamed looser SEC enforcement patterns for its demise, indicating that regulation is a tricky path for many businesses to navigate.
In terms of numbers, BitMEX’s shutdown announcement on July 23 is notable. Another case involves BitMart, which started winding down its global platform this month, undertaking a phased withdrawal process to settle open positions and customer assets safely. This exodus reflects a broader cooling trend in crypto venture capital and market activity.
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