Unpopular Opinion: It’s Good That ICOs Are Over

Blockchain, ICO News, News, Opinion | December 10, 2020 By:

According to Initial Coin Offering (ICO) statistics, the listings secured were only about 7%, and from Q1. The percentage that had working business was 6% and is currently 15%, however, more than 55% failed to reach their target for funding. Bitcoin’s success gave some attention to ICOs during the previous year, yet many have become useless because their team members were unqualified, some of their documents proved to be utter scam projects that took the chance to defraud unaware investors, and also some noncertified documents. In recent years, ICOs don’t get any attention at all and people are of the opinion that ICOs are dead

They raise minimal funds lately, and the main reason for this is because the market conditions are unfavorable. Although some people still invest in ICOs, the market is generally not doing well, and it is not a good idea to invest in them, although some investors still make profits. The high scam rate in the sector is also very discouraging. 

Why have ICOs failed?

There are many reasons for the failure of ICOs although some are still succeeding that includes the inadequate market product, unrealistic budgets and objectives, failure to create an identity for the brand, and the lack of reporting, auditing, and measurement. According to reports, ICOs fall started in 2017 when more than 800 cryptos were declared dead with ICOs taking the lead with a 55% fall. The research covered the ICO market for several years and noticed that more than 1900 ICOs did not raise any money since its launch in 2017. A few managed to get capital of more than $1 million, and among all, only 12 managed to collect capital exceeding the $100 million mark. Although the reports also show that the percentage improved from 6% to 15%, the profits are significantly very poor.

Investors are beginning to lose interest and necessary attraction. This is because of high scam possibilities, bad product development, markets are non-existent or drastically declining, they also face issues with execution and poor marketing. And according to Diar.co, tokens are worth 70% lower than what they were when their ICOs were raised. The reason for ICOs’ big failure can be based on the fact that the crypto market experienced big losses during the past years as compared to when the markets were booming. However, as the markets recovered, ICOs continued to fall, and many investors are of the opinion that it is getting ready to dig its grave.

Is it good that ICOs are over?

It is good that ICOs are dead because they are not regulated and there is no investor protection or verification, giving room for a lot of scams. Many investors have fallen victim to ICO scams and are typically very uninterested in the market and that certainly won’t change especially when the markets are falling drastically. Also, the fact that the requirement to begin initiating ICOs are very limited; which it makes it very difficult for investors to trigger relevant and correct data to ensure that they are making a good investment decision.

Also, it is good that ICOs die because they are mostly held up by investors in the community while IPOs have institutional investors who hold up the sector. The risk in making an ICO investment continues to increase because the products are immature. And in some cases, people are just investing in the idea without proper implementation planning.

One thing about ICO investments is that the initial capital is paid in bulk and there is no liability, making the possibility of pressure to deliver great products null. Many investors exit scams even after paying very huge amounts and the development of the activities slowly fall apart while the team enjoys the wealth they’ve gathered from the investors.

There is no doubt that some ICOs are making some profits, but investors are not ignoring all the red flags. Some experts say that ICOs might not make it to 2021, but this is only speculative. However, the number of cryptos sold in the form of tokens has drastically fallen, with some coins trading at $0. And investors are not surprised if ICOs completely vanish.