Many cryptocurrencies have been launched in the past few years, often to great fanfare and celebration, only to fade and fail as the public and investors shun them. According to Coinopsy, which tracks such failures, there are some 1,085 dead coins at the time of writing. That’s a substantial number, even next to the approximately 3,000 still in existence, and senior industry figures expect many of those to fail, too.

Why do so many of these projects unravel? One expects many initiatives to come and go in a fledgling market – the 1990s dotcom bubble is the perfect example. But at the same time, cryptocurrency developers have traditionally spent too little time designing the business-use case for their coins and tokens, then realising that their idea is yesterday’s news only after the launch.

Time and again, we see launches that copy a previously successful coin – “coin x is the new Bitcoin”, for example. Yet the market already has Bitcoin, and it continues to be in demand – as evidenced by the 18 millionth Bitcoin being mined only last month. We tend to overlook this problem with developers, even while we rightly criticise regulators for not being able to keep up with the fast evolution of the crypto market. This, despite efforts such as Howey Coin by the US regulator, Securities and Exchange Commission, which was a fake new coin offering designed to teach investors about the risks of putting money into crypto. No doubt these kinds of developer errors will continue. Here are several other themes that we think will have a bearing on future crypto failures.

Big finance has arrived

Eleven years ago, the pseudonymous Satoshi Nakamoto quietly revolutionised money with the release of his or her now-famous white paper, which outlined Bitcoin. In the early years after this vision took off, many of those who launched altcoins and tokens were small teams of developers and left-field entrepreneurs. They had a clear mission to bring the world of traditional finance and central banks to its knees with decentralised units of exchange that were beyond anyone’s control.

A few years on, these bank killers have largely been assimilated by the big financial institutions they once sought to challenge. Wall Street is steadily taking charge of the crypto action, professionalising trading with the likes of derivatives and futures products.

We may now be entering a phase where only large institutions will be able to generate profit from cryptocurrency design. It seems increasingly likely that the next revolutionary white paper will be generated by a global multi-billion-dollar firm – an ironic full turn of events, to say the least. Many other cryptocurrencies from more humble beginnings will fail in future, simply because they don’t have the resources to compete with these huge institutions. They will be driven by sunk costs and the crypto dream to dominate the future of money, but in many cases, it won’t be enough.

The future is stable

For a cryptocurrency to be successful, two things need to happen: there has to be a reason for people to use it, and they have to trust it. People will generally trust a coin or token, thanks to the underpinning blockchain technology, the decentralised cryptographic ledger systems on which this industry is built.

This means that the basis upon which the market judges if a new launch will stand or fall is mainly its use case. There are now altcoins in existence offering everything – from new ways to fund web advertising to units of exchange in the gaming world. But more generally, in a world in which it is no longer enough to simply claim to have launched a better Bitcoin, the market’s attention has pivoted towards stablecoins.

Stablecoins are cryptocurrencies that are designed to avoid the wild volatility of its cousins, like Bitcoin, by being pegged or backed by assets like traditional currencies or precious metals. They are designed to encourage people to use cryptocurrency for everyday buying and selling, while also offering a stable store of value for traders on the many crypto exchanges that don’t deal in traditional currencies.

Examples include USD Coin and Tether, both of which are equivalent to US$1. The fact that it takes considerable financial resources and infrastructure to make such coins operational is again likely to favour large institutions – witness Facebook’s attempt to launch the Libra stablecoin, for instance.

Losses more foul than fair

Many investors have lost money through scams in the crypto world. One recent notorious example is the alleged OneCoin ponzi scam, in which investors were promised guaranteed 300% returns for investing Bitcoin or US dollars with a Nevada-based outfit. The money was supposed to be ploughed into foreign exchange options and altcoins, but was allegedly instead used to pay off other investors in the scheme. Fortune magazine recently speculated that OneCoin may have generated losses in excess of the US$19.4 billion, racked up by Bernie Maddoff’s ponzi victims in 2008.

Somewhat different was Bitconnect, an exchange in which investors could swap Bitcoin for Bitconnect coins, which would be lent out with claimed returns of up to 120% per year. After longstanding ponzi accusations, the US authorities stepped in last year and the exchange abruptly closed. Bitconnect coins plunged 96% in value, creating huge losses, though they still exist and trade today.

An alternative problem is hackers raiding exchanges. The most infamous example is the Mt Gox attack of 2014, in which over 850,000 bitcoins were stolen and never recovered. More recently, the Binance exchange, one of the world’s largest, has been hacked several times, costing investors tens of millions of dollars.

One other alarming case was that of Gerald Cotten, the 30-year-old founder of Canadian cryptocurrency exchange Quadriga, who died a year ago. Because nobody had access to his passwords, the investments of 1,15,000 customers worth US$137m were unrecoverable. When a court-appointed auditor was eventually able to access his account, it turned out the assets had all been sold months before Cotten died.

We fully expect these sorts of problems to continue – and this shouldn’t be surprising. We are talking about a toxic combination of anonymous technology that is largely unregulated, poorly understood, and cheap and easy to move around the world – and many people willing to kiss frogs in their search for a lucrative prince.

Gavin Brown, Senior Lecturer, Finance, Manchester Metropolitan University. Richard Whittle, Research Fellow in Economics, Manchester Metropolitan University.

This article originally appeared in The Conversation.