46% of ICOs failed to raise funds since 2017: report
Nearly half of the ICOs of 2017 and 2018 fails to raise a single dollar, new report finds. A report published by Greyspark, a business consulting company, analyzed various aspects of the cryptocurrency industry like growth of ICOs, cryptocurrency mining, OTC trading, crypto to fiat trading etc. They charted the progress of these aspects and compared their yearly performances.
Greyspark published the research based on data from ICOData.io and ICO-Check.com through August 2018. The report found that nearly half of the ICOs raised absolutely no funds while only 40% could reach the $1 million mark. Putting it simply, 893 token sales [ approximately 46%] attracted zero funds while only 793 could make more than a million dollar.
The report further went to identify returns of the ICOs yearly and found that ‘the percentage of ICO projects showing positive returns declined with time’. The report suggests some reasons for this decline: “lack of traction, disappointing product advancements, scams, difficulties in execution, no market and poor marketing or go-to-market strategy.” The first decline was felt in the retail interest in ICOs. Years 2016 and 2017 saw gains up to 80,000 times the initial investment however, as the years progressed the ICO value fell below the token sale price and failed to recover.
Another interesting find in the report is the statistics of public interest in cryptocurrencies. The report says that the public interest in cryptocurrencies have spiked especially since the Bitcoin bubble in earlier this year. Coinbase sports the most user base with users around 20 million. Also, the number of Bitcoin and Ethereum wallets and the number active addresses on Bitcoin and Ethereum Blockchain has increased.
While public are showing increased attention towards major cryptocurrencies ICOs of seed start ups are neglected due to surging regulatory concerns and scams. According to study published by Satis Group, almost 80 percent of 2017’s ICOs were “identified scams.” Scams are the primary reason why investors stay away from ICOs . Also, governments are increasingly recognizing cryptocurrencies fearing scams and public losing money and are trying to introduce regulations to the loosely regulated industry.
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