• 21 hours Low Prices Plague Beleaguered Lithium Miners
  • 2 days Is This The Big Biotech Bust?
  • 2 days Funding Is The Biggest Hurdle For Clean Energy
  • 3 days Walmart Reaches Out To Chilean Government For Protection
  • 3 days The Most Exciting Gold Find Of The Decade
  • 3 days Mining Boom Sparks Deforestation Concerns
  • 4 days The Cannabis Culling Has Wall Street Disappointed
  • 4 days Vigilante Offers $100,000 Bounty To Hack Banks
  • 5 days The Dairy Industry Is Dying
  • 5 days The Most Impressive Electric Vehicle Of The Year
  • 6 days Gold Miners Are Having A Stellar Second Half
  • 7 days How 3D Printing Is Turning Each And Every Industry On Its Head
  • 7 days Is The $3.5 Trillion Healthcare Industry About To Get Much More Transparent?
  • 8 days Gamblers Are Betting Big On Trump’s Impeachment
  • 8 days Even Banks Can't Answer Aramco's Trillion Dollar Question
  • 9 days Will Bezos Buy The Seattle Seahawks?
  • 9 days 6 Tech Trends Transforming The Travel Industry
  • 10 days Ousted Uber CEO Cashes Out $500 Million In Stock
  • 10 days Trump Prepares For Another Key Tariff Decision
  • 10 days The Free Money Bubble Is About To Burst
$32 Million Crypto Heist Halts Tokyo Exchange

$32 Million Crypto Heist Halts Tokyo Exchange

Tokyo’s Bitpoint Japan Exchange has…

$15,000 For Your Crypto’s Ticket To Visibility

$15,000 For Your Crypto’s Ticket To Visibility

Market manipulation might be the…

  1. Home
  2. Cryptocurrencies
  3. Other

The ICO Walk of Shame: 50% Dead On Arrival

BTC

Initial Coin Offerings (ICOs) are rapidly turning into a space where money goes to die, with almost half of new tokens already dead and over 100 on life support.

A total of 418 of 902 blockchain-backed crowdsales tracked by TokenData in 2017 have already been buried, and another 113 are currently on life support.

Over 140 ICOs failed before they raised any money. But even worse, almost 280 failed after they raised funds.

Some of them were pure scams, others saw their creators make away with the money raised, and still others faded quickly into obscurity because no one was interested.

The seemingly depressing data indicates that these white elephants still managed to raise over $233 million among them, even when many looked sketchy from the outset.

If you count those 113 ICOs considered to have one foot in the grave, we’re looking at a 59 percent rate of failure.

It sounds dire, indeed, but keep this in mind: Traditional venture funded startups have a failure rate of 75 percent, Fortune points out.

So why are we so nervous about ICOs?

In part, it’s perhaps because the crypto craze, thanks to the media, reminds us all of the dotcom crash. But it’s also because as an ‘industry’, and even as a currency medium, the fact that it only exists in the ether makes it that much more frightening. Related: Chinese Telecoms: Competition Or National Security Threat?

Despite our fear of the unknown, ICOs are certainly in vogue. They’ve overtaken traditional venture capital as the preferred method for startups to raise funding.

(Click to enlarge)

Source: Business Insider

(Click to enlarge) 

Source: CoinDesk

ICOs are in good company, too--the list of failed cryptocurrencies runs into the hundreds as the digital graveyard continues to claim casualties.

The cryptocurrency market is now approaching three-quarters of a trillion dollars after growing nearly 20 times in size in 2017, while the ICO market continues expanding at a frenetic pace.

And for many right now, it’s eerily reminiscent of the infamous dotcom crash of 200, when the economy was chugging along with thousands of sexy internet-based companies popping up right, left and center until the bubble burst, wiping nearly $2 trillion off the stock markets in months.

The combined crypto market is nowhere near as big as the $6.7 trillion-valuation of the stock market prior to the March 2000 crash. Still, it's big enough to cause a panic selloff in tangentially related markets if it was to crash, not to mention leaving many people languishing in the poor house.

But all of this data also ignores the ICO success stories. After all, they raised $5.6 billion last year alone. The trick is that the 10 largest sales accounted for 25 percent of the total capital raised in 2017.

By Alex Kimani for Safehaven.com

More Top Reads From Safehaven.com:

Back to homepage

Leave a comment

Leave a comment