Economist Alex Krüger delivered a blunt verdict this week: the 'crypto' asset class has largely failed. In a detailed assessment, he argued that most tokens are worthless or suffer from dreadful value accrual, while founders exploit weak guardrails to dump on retail investors. Krüger also pointed to what he calls the 'Memecoins SuperBullshitCycle' and a wave of DeFi hacks since April as crushing any remaining credibility. Total crypto market capitalization stood at $2.28 trillion at press time.
Why Krüger calls 'crypto' failed
Krüger didn't mince words. He said the bulk of the token market is structurally broken—assets with no revenue, no user demand, and no mechanism to return capital to holders. Founders, he said, regularly abuse the lack of guardrails to exit to retail. The memecoin explosion and the recent spate of DeFi exploits only made things worse, driving away the last serious buyers. For Krüger, 'crypto' in the traditional sense is a failed experiment.
Blockchain vs. crypto: a widening gap
But Krüger draws a hard line between 'crypto' and 'blockchain'. Infrastructure and application layers, he said, are accelerating. Stablecoins, tokenization, prediction markets, perpetuals, AI, and privacy-focused assets are seeing real adoption and revenue. He specifically names Hyperliquid as a token with a clear link to revenue—it uses buybacks to distribute earnings to holders. That kind of capital-return mechanism, he argues, is what separates viable assets from speculation.
Privacy and AI: two niches that work
Privacy tokens, an 'old school' crypto category, are still drawing flows. Zcash, Krüger noted, is attracting capital even as Bitcoin trends lower—partly driven by illicit demand, but still real demand. On the AI side, most tokens are pure narrative, but he flags Venice as an exception: it's tied to a private AI platform with growing users and actual revenue. Krüger sees these as proof that tokens can work when they're connected to something tangible.
What 'new face' of crypto looks like
Krüger's bottom line: the old face of crypto is dead. The new face is heavily dominated by TradFi, prediction markets, AI, and privacy. The token market that survives will be narrow—assets that can show revenue, user growth, or a real capital return mechanism. Everything else, in his view, is just noise. Whether the broader market agrees is the open question, but for now the infrastructure side is running ahead while the speculators' playground smolders.
