The Strange Case of ICO Returns
An analysis of historical returns
Note: this full version of this article is now on the Sangus blog. Read it in its entirety here.
2017 seems to be, along with perhaps a few political contenders, the year of the ICO (or Initial Coin Offering). The potential of cryptocurrencies is beginning to take off, and we are seeing this not only in valuations but in the strength of the developer communities that are forming. It is an exciting time! But along with the innovation enabled by the new economy, there are a raft of risks associated with the lack of standards and regulations. Here at Sangus we are working hard to develop a new form of due diligence marketplace and rating agency to help address the information disparities faced by ICO investors.
The ICO space is still relatively new, making a detailed analysis of historical returns difficult. But even with the data dataset available from CoinMarketCap we are able to see some interesting trends, particularly when it comes to the ratio of “flops” to huge successes. You can find the code used to generate the results in this article here. All data comes from historical snapshots provided by CoinMarketCap from April 28, 2013 through June 18, 2017. Please reach out if you have comments or thoughts about the analysis and I’ll try to get back to you as soon as possible (also happy to share the dataset if need be).
