ICOs Raised $8.3 Billion Last Quarter, but Most of them Were Abject Failures
ICOs Raised a Record $8.3 Billion in Q2, But Most Missed Their Targets
The independent ICO analysis portal found that 55% of the ICOs failed in Q2 2018. That is 5% more than the number of failed ICO projects recorded in Q1 2018. Nevertheless, money continued to flow in the ICO projects as a whole, raising from $3.3 billion in the first quarter of 2018 to $8.3 billion in the second — amounting to a 60% surge in investments.
[Editor’s note: The EOS crowd sale technically raised $4 billion over the course of a calendar year, but startups are often said to have “raised” the funds during the month or quarter in which their ICOs concluded.]
The ICOs that offered service and utility tokens were at the forefront of failure. ICORating said that “emission conditions, token type, and metrics had [an] indirect effect on fundraising success,” indicating that not all the unsuccessful ICOs could have been of poor quality.
The vast discrepancy led ICORating to conclude that “the overall quality of projects has significantly worsened.” A small number of projects have reportedly raised an average of $50 million per project, while the failed ones couldn’t even cross above $100,000 worth of investment. PumaPay, a reasonably-simple cryptocurrency payment and billing solution, single-handedly raised $117 million in May 2018.
The ICORating report also highlighted the bearish angle of the second quarter, revealing that the median return for the token in Q2 was a 55% loss. It is poor in contrast to the first quarter’s impressive return of 49.3%. However, the decline can be blamed the cryptocurrency market’s dismissive performance in Q2. Bitcoin, the topmost digital currency, has already declined over 50% in 2018.
Source: CCN News