New data indicates that ICOs remain popular with crypto bulls despite mass selloff of virtual currencies. So far initial coin offerings have attracted $12 billion which is a record amount compared to past years.
Data from Autonomous Research LLP shows that the figure from the first half of 2018 is $7 Billion more than what was raised in 2017 and 50 times more than what was raised in 2016. This interesting given that since December last year crypto coins like Bitcoin have lost over 70% of their value and many other less popular tokens have lost almost all their value.
Much of the enthusiasm that we have witnessed this year from crypto bulls has been centered on the two big offerings of the year; Telegram which is a messaging platform and EOS which is an open source smart contracts platform for dApps.
Last year’s stellar performance of crypto tokens seems to be the reason which is driving most crypto bulls into new ICO projects in large numbers. Many are hoping for a repeat of the massive returns realized by ICOs in 2017.
However, this might not be the case according to Lex Sokolin. The global director of Fintech strategy at Autonomous speaking to Bloomberg via a phone call says:
“This is a high-risk sector, it is early-stage tech and lots of it by definition is going to die.”
An initial coin offering is a fundraising method where new projects sell their crypto tokens in exchange for other cryptocurrencies like Bitcoin and Etereum or fiat currency. They are a bit similar to the Initial Public Offering (IPO) where investors purchase shares of a company.
ICOs are fast becoming popular among new ventures as it’s easier and faster to raise funds this way.
What are some of the reasons that are making ICOs remain popular with crypto bulls? Share your thoughts in the comment section below.