The funds earned from ICOs since the beginning of this year have exceeded the amount of funds earned from ICOs for the entire 2017.
In 2018, many startups began raising significant amounts of money through initial coin offerings, with block.one alone earning $4 billion from EOS. In total, there were 343 ICOs in 2018 that raised $9 billion, of which block.one's ICO is considered the largest in the world.
According to CoinSchedule, companies only raised $4 billion in 2017.
The ICO market is still active, says Alex Michaelis, one of the founders of CoinSchedule. The largest were the Telegram ICO for private investors and the EOS coin ICO, which is traded on the exchange.
This year’s new record is accompanied by strict regulation. China has banned ICOs, the US Securities and Exchange Commission closely monitors proposed tokens and closes unreliable projects.
The main problem associated with many ICOs is insufficient disclosure of information to investors, which does not allow them to fully assess the risks. Information about how the collected funds will be used and what rights are provided to investors is not fully disclosed. Unfortunately, in most cases, investors have no rights.
Many ICOs, including EOS, have overcome the regulatory problem by banning citizens of America and China to participate in them.
According to Fortune, raising funds through ICOs could negatively affect the entire cryptocurrency industry, since many ICOs in 2018 turned out to be money scam.
One example is the iFan ICO in Vietnam, which raised $658 million to become “the most advanced social network.” The network was based on the Ethereum platform and was supposed to unite celebrities, their fans and followers. Investors were promised profits of up to 40% per month. There was a profit, the price of tokens on the platform was growing, but investors could not withdraw any part of it in cash.
“There is a lot of early speculation in the launch of a cryptocurrency, which is very risky,” says David Packman, partner at venrock. “And many such projects end in failure.”
According to btcmanager
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