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ICO Market Is Dead, Only $118 Mln Raised in Q1: WSJ Report

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Mon, 1/04/2019 - 6:25
ICO Market Is Dead, Only $118 Mln Raised in Q1: WSJ Report
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In case you didn’t notice, the great ICO bubble has popped, and the latest report by the WSJ vividly displays the steep downfall of this fundraising craze. Only $118 mln of capital has been raised via ICOs in the first quarter of 2019, a world of difference from $6.9 bln investors threw at initial coins offerings during the same period last year.

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From excitement to skepticism

The report, which relies on the information provided by research site TokenData, states that the rapid decline of the ICO market is attributed to the double-whammy of regulatory clampdown and the brutal crypto winter. Investors, who were blinded by the Bitcoin craze, are adopting a skeptical attitude towards cryptocurrencies.

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Uncomfortable statistics

The lion’s share of the projects (55 percent) even didn’t manage to raise money. Case in point: Sponsy, a failed ICO that ended up on eBay. On Sept. 26, U.Today reported about 70 percent of ICOs falling below their initial price, but TokenData now reveals that a whopping 85 percent of coins offerings failed to meet their investors’ expectations as of March 2019. TokenData CEO Ricky Tan calls a spade a spade by pointing out that token sales are ‘pretty much dead.’

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Rising up from the dead

However, attorney Joshua Ashley Klayman is still certain that the idea of ICOs is ‘worth developing.’ Regulators have to come up with a set of rules for coin offerings that would allow startups to raise funds in a legal way.

SeedInvest, an equity crowdfunding startup that was acquired by Bitcoin unicorn Circle, is also poised to be a boon for selling tokenized securities to retail investors.

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