Initial Coin Offering (ICO) is the most commonly used means of raising funds for blockchain-based projects.
It became especially popular because it used to be relatively easy to raise a substantial amount of money in a fairly short period of time. ICO investment was fabulously popular in late 2017 and towards the first three quarters of 2018 but their popularity has faded. This is because a lot of the projects turned out to be a scam, while the vast majority of them lost more than 90% of their value.
And most of the crypto experts may raise questions like - Will the new life in the cryptocurrency markets breathe new life into ICO markets?
In a recent survey: 41% of Institutional Investors to Invest in ICOs Within Five Years
Yes, the good news is - ICOs Ain’t Dead Yet: ‘Wild West’ of Crypto is Making a Comeback!
The survey was conducted in December 2018 and January 2019 by market research company PollRight and included responses from 71 global institutional investors, including private equity, hedge funds, and pension funds.
According to the survey, the growth of the digital asset industry can increase the initial coin offering (ICO) market, as 16 percent of those surveyed responded that they would invest in that sector within three years.
While a larger group, 41 percent, believe that institutional investors will only enter the ICO sector in the next five years, 23 percent also recorded that they do not see investment potential within the ICO market.
Ref - cointelegraph.com
History of Initial Coin Offering (ICO)
When a cryptocurrency startup company or project wants to raise funds through an Initial Coin Offering (ICO), it commonly creates a plan on a whitepaper which states what the entire project is about, what requires the project will fulfill upon completion, how much fund is required to undertake the firm, how much of the virtual tokens the experts of the project will keep for themselves, what type of currency is accepted, and how long the ICO campaign will run for. At the time the ICO campaign, enthusiasts and supporters of the firm’s initiative buy some of the distributed crypto coins with fiat or virtual currency. These coins are specified as tokens and are similar to shares of a company sold to investors in an Initial Public Offering (IPO) transaction.
If the fund raised does not meet the minimum funds needed by the firm, the fund is returned to the backers and the ICO is deemed to be unsuccessful. If the funds' requirements are met within the particularized time frame, the money raised is used to either initiate the new scheme or to complete it.
New investors in the operation are frequently motivated to buy the crypto coins in the hope that the plan becomes successful after it launches which could translate to a higher crypto coin value than what they purchased it for before the project was initiated. Early Investors earn and get ICO Bonus.
An example of a successful ICO project that was profitable to early investors is the smart contracts platform called Ethereum which has Ethers as its coin tokens. In 2014, the Ethereum ICO project was announced and its ICO raised $18 million in Bitcoins or $0.40 per Ether.
The project went live in 2015 and in 2016 had an ether value that went up as high as $14 with a market capitalization of over $1 billion.
TOP 10 ICO- Friendly Countries 2019
While British virgin islands are the leader by the number of funds raised, the UK takes the lead by the number of completed projects in May 2019:
Is ICO similar to IPO & Crowdfunding?
ICOs are similar to IPOs and crowdfunding. Like IPOs, a stake of the startup or company is sold to raise fund for the entire operations during an ICO operation. However, while IPOs deal with investors, ICOs deal with supporters that are alert to invest in a new project much like a crowdfunding event.
But ICOs differ from crowdfunding in that the backers of the former are motivated by an expected return in their investments, while the funds raised in the latter campaign are basically donations. For these reasons, ICOs are referred to as crowd sales.
What is an ICO Airdrop?
Airdrop is basically free tokens for you. It is a marketing method, however, it could be free money for you if the ICO project succeeds, the main point of the Airdrops is to spread the ICO project to the relevant audience of potential investors.
ICO industries Statics:
In 2019, the most numerous industries by no of ICOs ended are platform and cryptocurrency. However, leading industries by the average amount of funds raised per ICO are real estate, Banking, and Big Data.
What is an ICO Bounty Program?
ICO Bounty is a reward program for promoting an ICO. Rewards paid in ICO tokens. Bounty program can include various different activities like making YouTube review for the ICO, translating whitepapers in different languages, spreading ICO project on social media, writing articles...
Let’s have a look what’s going on of the market for ICO. In the past years, there have been a couple of wildly successful ICO.
Dragon & more…
These are some of the successful ICO projects for the past couple of years. In the future, most of the ICO projects are going to be live and crap the investor's attention in the crypto space.
Top 5 ICOs by funds Raised
Bitfinex - $1B
Bitfinex has launched the LEO token in its IEO campaign.LEO presents a sizeable opportunity for existing iFinex users and those who wish to use iFinex platforms and services. A special purpose subsidiary of iFinex intends to sell up to USD 1 billion worth of LEO tokens.
Shercoin - $36M
Shercoin features five different related applications is one. The ecosystem has a theme: User provides valuable economic services for businesses such: as checking market place for counterfeits, reporting fake or suspicious products; filling out surveys and giving information, feedback, and data, so business can make informed decisions;giving the users an easy way to manage the cryptos the earned; and then giving them outlets to spend/exchange their tokens.
Harmony - $23M
Harmony is the next generation sharding based blockchain that is fully scalable, provably secure and energy efficient. harmony addresses the problems of existing blockchain by combining the best research results and engineering practice in an optimally tunes system
Lancor scientific -$20M
Lancor Blockchain Platform (LBP) is a blockchain based ecosystem designed with the vision to make cancer screening available for everyone everywhere at a cost all can afford.
Volentix - $15.5M
Volentix is building a decentralized digital assets exchange connected with a secure multi-currency cross-blockchain peer-to-peer wallet, a user-friendly market-ratings analytical interface, and an incentive-based recruitment program.
ICOs have been a highly hot topic for a couple of years now and we hope that we were able to throw some light on the subject for you. It will be interesting to see how future ICOs turn out and the regulations become more and more strict. Let’s hope that the increased regulations are going to have a positive effect by flushing out scammy ICOs.
Developcoins - ICO Business Solution
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