ICOs are all the rage these days, but how much do you really know about ICOs? Is the skepticism behind them warranted? Their reach has hit just about every continent on the planet including but not limited to North America, Europe, and Asia. Below are ten statistics you might have missed during your own research and deliberation of ICOs.
1. Close to half of cryptocurrency ICO projects failed in 2017
Not all ICOs have what it takes to succeed. In a survey conducted by Bitcoin.com, a predominant cryptocurrency news website, 46% of the 902 ICOs they studied have failed completely. While some turned out to be scams, others simply failed to capture the interest of investors due to low-quality projects or lack of promotion.
2. Governance was the least successful industry in 2017 for ICOs
While there are number of factors that determine the success of an ICO, looking at the total amount of funds raised for the project is a good place to start. For government ICOs that number was just $258,645. However, governments are only just now entering the cryptocurrency market in 2018, so this number may rise.
3. More than 10% of the $3.7 billion raised in ICOs has been hijacked by hackers
Professional services firm Ernst & Young analyzed 372 ICOs and discovered that close to $400 million of the funds raised ($3.7 billion) had been stolen. Their research suggests cybercriminals are stealing approximately $1.5 million per month in ICO proceeds. Hackers have various hacking techniques, but phishing appears to be the most popular method used to tap into the payouts associated with ICOs.
4. Several countries have banned ICOs altogether
Governments tend to not be fans of cryptocurrency or ICOs as it could undermine the existing societal and financial structures currently in place. At the writing of this blog, countries that have outwardly banned ICOs are China and South Korea. In Bolivia, Bangladesh, Ecuador and Kyrgyzstan, any form of digital money is banned, making the development of ICOs virtually impossible.
5. Ethereum tops the blockchain platform market share in ICOs
Many ICO projects are underlined by the blockchain technology so that tokens may be developed, but most are not pure cryptocurrency (i.e Bitcoin). This is why many have turned to the Ethereum platform since developers can design and issue their own cryptocurrency. With its Smart Contract feature, Ethereum will likely continue to dominate the blockchain platform market in ICOs as investors place more importance on speed and security.
6. Switzerland and Singapore named the best countries for ICOs
Some countries may choose to partially regulate the ICO market while others may make it easier for businesses to develop an ICO from scratch. Countries that are known their economic and political stability tend to cater to ICOs well like Switzerland and Singapore, which have high GDP per capita and stable governments. In Switzerland, the government has even taken steps to promote the development of a blockchain ecosystem.
7. In one study, 12% of ICOs failed the KYC
In the business world, KYC, which stands for “know your customer,” is an important process for verifying the identities of clients. For ICOs, they are part of an important compliance process in tune with current ICO regulation trends. In a study of 500 ICOs, 2% were pending invitation, 86% passed, and 12% failed.
8. Early investors on ICOs are making 50,000% in ROI
ICOs are increasing at an exponential rate and those who are investing in promising ICOs early on are seeing huge payouts following the private sales — as much as 50,000% in returns! It’s no wonder many are rushing to invest, but not everyone is lucky since there are also many instances in which ICOs turn out to be outright scams.
9. The average ICO launch will cost between $100,000 and $500,000
ICOs are expensive. There’s a lot going behind the scenes that developers of ICOs must do to make them stand out. From deploying the technology behind the project, creating an online presence and opening various communication channels, in addition to addressing the regulatory issues behind an ICO project, it can get costly — upwards to $500,000 on the higher end.
10. 2018 ICO funding for Q1 has surpassed 2017’s total ICO funding
Approximately $4 billion was poured into hundreds of ICO projects during 2017. That number is only growing by the day. According to CoinDesk, during 2018 Q1, ICO funding reached $6.3 billion, 118% of the total for 2017.
ICOs will likely continue to be a hot topic with some even predicting the rise of a second-generation of ICOs.