ICO activity is rapidly declining. LongHash experts found that most ICO projects ceased to attract investors. The reason for this was several factors, the most important of which is the volatility of the main cryptocurrency and the entire market. Stability for several weeks or even months can suddenly be replaced by a transition to a bearish mood, which frightens large companies.
"Still, it’s hard to see the upside for ICOs going forward. Even if what’s on offer now is higher quality than many of the tokens sold in 2018, there probably aren’t enough tokens ICOing to sustain the ICO as a viable fundraising model. It wouldn’t be a surprise to see the ICO model vanish completely in 2020." - said LongHash experts.
About 80% of the projects that were launched in 2018 were not able to raise funds. Currently, startups have completely stopped issuing tokens. An alternative, in this case, was the presentation of preliminary versions of software products, evaluating which companies can think about investments.
In July 2019, the number of funds raised through the ICO amounted to about $12 billion. Approximately 800 completed projects turned out to be unprofitable and could not receive the declared amounts.
One possible reason for the incredible reduction in the number of initial proposals is the tightening of regulatory control around the world. LongHash is confident that this year’s trends indicate that ICOs have become obsolete as a viable fundraising model.