According to data from CoinSchedule, ICOs have raised close to $30 billion over the past 2 years, most of it being in 2018. However, despite that fact, one does not have to look for long to realize that, the majority of projects have nothing to show for it, especially when it comes to user base, product adoption, and overall activity.
As Sam Gellman from Uber put it:
After $30 billion invested in the past two years in ICOs there still isn’t a single crypto app with a real user base for anything other than speculating on crypto. The BTC price movement is tough, but the lack of real user base for anything they’re investing in is tougher.
It is imperative to mention here that, there are still a handful of projects that have demonstrated relative success. For example, there is TokenGen (by Fabric Token), a user-friendly ICO dashboard that is both relatively cheap and extremely functional.
Then there is also BNB (Binance Coin), which is already working as the fundamental cryptocurrency of the exchange and is also planned to be used in the soon-to-come decentralized Binance exchange.
The bad news is that, it seems that regulations will get tighter around the crypto industry (and especially ICOs), so it will become even more difficult for projects to raise funds and then deliver on their promise.
Just last week, the SEC enforced their authority on two ICO projects that sold securities without a license as they called upon them to issue refunds to their investors.
They have also agreed to compensate investors who purchased tokens in the illegal offerings if an investor elects to make a claim. The registration undertakings are designed to ensure that investors receive the type of information they would have received had these issuers complied with the registration provisions of the Securities Act of 1933 (“Securities Act”) prior to the offer and sale of tokens in their respective ICOs.
The SEC mentioned however that they are not against blockchain adoption and actually support these newly emerging technologies.
We wish to emphasize, however, that market participants must still adhere to our well-established and well-functioning federal securities law framework when dealing with technological innovations, regardless of whether the securities are issued in certificated form or using new technologies, such as blockchain.
Still on the topic, the bear market of 2018 has a silver lining. It has filtered the good projects from the bad and naturally, those that survive it will be the trailblazers in this emerging industry.
Crypto investors are becoming more and more sceptical towards new projects and this is creating an essential filter that the ICO ecosystem has been so far lacking.