ICO News – Almost half of the last year’s ICOs failed: Most of the investors are aware of the fact that ICO’s can be a very risky. Up until now, however, there wasn’t concrete data to prove the risk. Recently, a report was published on Bitcoin.com which came to the conclusion that at least 46% of the ICO’s launched of 2017 have failed. The total amount raised by ICOs last year was around $ 104 million.
High risk in ICO’s:
This again highlights the fact that the amount of risk in the ICO market is immense. Also according to another website Tokendata, in total there was 902 tokens sales last year. Around 142 from these failed during the funding stage. Another 276 failed thereafter. This clearly indicates that around 46% of the ICOs since last year have already failed.
In addition to that, another 113 ICO’s are on the verge of failing or would fail in the near future. These were judged by the lack of communication from the managements as well as lack of updates on their social media channels. This brings the number to 59% which is actually more than half of the ICO’s.
In many of the cases, it was found that the company websites were no longer live. Moreover, the companies did not even attempt to execute their strategy in many of the cases. Some of the ICO’s even raised amounts as high as $ 10 million.
Many of the ICO’s were slated to be a failure right from the start like Clitcoin, Zero traffic etc. Also, some other ICO’s are trying to rejuvenate themselves and raise more money from the investors. The investors should actually keep away from such ICO’s as they can again lose their money.
Lessons to be learned:
The stark lesson among this carnage is that only investors with high-risk appetite should invest in the ICO market. Moreover, investors should research and conduct due diligence religiously before investing in any ICO.
With ICOs increasing the amount to be raised this year, the amount of money which would be lost is going to be even higher. This makes ICOs a much riskier asset as compared to even some of the cryptocurrencies. It is fast becoming a market only for institutional investors. The reason for this is that institutional investors are able to research and conduct due diligence on a far better scale as compared to the retail investors who do not have proper resources. It is a good idea to be highly selective in the ICO market as the chances of failing are higher as compared to success.
Adam Webb is editor in Smartereum, blockchain and currency news, where he produces updates on Blockchain, Ethereum and other alternative cryptocurrencies.