It is quite natural to expect that many ICO-projects initially will not succeed. Usually they end their lives either at the fundraising stage or when they should have already reached the point of presenting the final product to investors. It is difficult to establish an exact figure, since most ICO-scam leaves the crypto market on tiptoe, without noise and without dust. Having completed an extensive study of last year’s diversity of ICO projects, news.Bitcoin.com reports that 46% of them are actually dead, despite the fact that they raised all together more than 104 million dollars.
ICOs are even more dangerous than you think
Of course, everyone understands that nothing is eternal in our world: time comes and everything fades. Nobody expected that all 2017 ICOs will live forever. But the pace with which they are dying, can become a surprise.
The Tokendata, one of the most comprehensive ICO-trackers, lists 902 crowdsales that took place last year. Of these, 142 failed at the funding stage, and another 276 projects quietly “disappeared in the mist” immediately after gaining money. This means that 46% of last year’s ICO has already failed.
Next come ICO-projects, which are half-alive. There are 113 other projects that can be classified as “half-failed”. This is because their teams have stopped communicating in social networks, or because their community is so small that the project does not stand a chance of success. As a result, we get that as many as 59% of last year’s token projects are either already confirmed failures, or are such in the course of their activity.
Digital Cemetery of Forgotten Promises
Combing and analyzing more than 900 ICO projects in one session is a very depressing experience, as news.Bitcoin.com reports. Abandoned Twitter accounts, empty Telegram groups, websites that are no longer up to dated, and communities that are quietly dying are typical of such projects. A real digital cemetery completed with wreaths of dried flowers, so is characterized the harvest of ICO projects of 2017, which raised money and disappeared.
Some of them collected zero investment, some raised a couple of thousand dollars and literally a handful attracted more than $ 10 million. In each case, the final result was the same: the absence of an MVP (a minimally viable product), of an alpha version of the project, and no contribution to a decentralized network to improve the lives of all of humanity.
Many of the now dead ICO were doomed from the very beginning. Some of them have failed at the fundraising stage, but now are trying to resume work this year and hope that the failure of 2017 can be written off as a “test run”. One such example is the Doft freight platform.
Looking at the countries of origin of failed token projects, we see that most of them are from developing countries and even represent the whole continent in the case of Africa. Nevertheless, the “shameful list” also includes all the great powers and representatives of all continents.
Conclusions from the lessons learned
Many of the 531 failed ICO-projects looked somehow suspicious from the very beginning. In most cases, investors were able to identify signs of a scam. However, not all of them escaped losses: these projects collected from investors the amount of 233 million dollars! Since ICO-mania shows no sign of weakening, we can again expect that this year the situation will be no better. According to crypto market analysts, in 2018 investing in ICO is more risky than ever.
It is worth mentioning that several days ago Vitalik Buterin once again warned us not to invest more money in the cryptocurrencies than we are ready to lose…