Everyone boasts about the size of ICO receipts, but this is not the main thing
New records for ICOs are being set almost every month — the lightning-fast $24,75 million in 15 minutes (Aragon), the impressive $170 million in five days (EOS), the massive $257 million month-long campaign (Filecoin), which, by the way, is larger than the entire ICO market last year. Meanwhile, in 2017 ICO receipts surpassed the next important milestone — $3 billion.
But regardless of the impressive numbers, not all investors are benefitting from the hype surrounding ICOs. Recently Jordan Belfort, that same Wolf of Wall Street, called ICOs the largest fraud in history: “They are far worse than anything I was ever doing”.
The fact is that only one out of ten tokens issued for ICO are used for business (i.e. payment for services), while the rest can only be traded. Many teams don’t even reach the stage of selling their product and then their tokens turn into a worthless digital asset. Recently in the US a charge of ICO fraud was made for the first time against ReCoin (the project promised to create the first cryptocurrency backed by real estate) and DRC World (the project was to be backed by investments in diamonds). Regardless of the bold statements, the companies did not conduct any activity.
Real success is not collecting millions in the ICO, but to increase the value of the tokens after the ICO. This is possible only if the startup works on their product and actively builds their ecosystem. Here are several impressive examples, when due to such a policy the value of tokens after the ICO grew a hundred times over.
Neo — growth by 90 339%*
The Neo digital assets platform (previously named Antshares) is called the Chinese Ethereum. It is the first blockchain platform in China using open source code. Developers of smart contracts at Neo can use familiar and popular programming languages such as JAVA, C/C#, or GO. While at Ethereum they have to write code in the platform’s native language Solidity.
Neo held an ICO in 2015. At that time a token could be purchased for just $0.03. The company sold 17.5 million tokens for $556,000.00. Now just one Neo token costs $28.80 — investors that invested in the project at the beginning have multiplied their capital almost a thousand times!
For almost three years after the ICO the platform did not waste time: it established alliances with well-known blockchain startups (AdEx, Bancor, Coindash, Agrello), began developing an innovative operating system using the Elastos blockchain, upgraded their technology and switched to the Neo 2.0 smart contract system, and also rebranded he project. In the first days after completing the rebranding (in August 2017), the NEO cryptocurrency had already entered the top 10. Now it is at 7th place in popularity, while its market capitalization is approaching $2 billion.
Stratis — growth by 52 668%
The mission of the Stratis blockchain platform is to become a guide in the blockchain world for corporations and enterprises in the real sector of the economy. The project simplifies the development, testing, and deployment of blockchain applications and operates under the blockchain-as-a-service (BAAS) model. As with Neo, Stratis offers its system of smart contracts in popular programming languages.
The company held an ICO in 2016. At that time 84 million STRAT tokens were sold for $610,908.00. Almost 1.5 years later the value of a token has increased more than 500 times — from $0.007 to $3.60. Several times in the last year Stratis was the most profitable ICO in the world, now it is in the top 5.
There are several projects at Stratis that the team has been developing since the ICO. Some are already available to users: for example, in July 2017 the company released an alpha version of the Breeze Wallet which enables anonymous Bitcoin transactions. Also, Stratis became a Microsoft partner and its tools are now available in the Azure cloud service.
Capitalization of Stratis tokens is now at $356 million. It is ranked 18th by popularity.
Etheroll — growth by 4516%
It’s not too surprising when projects that conducted an ICO a couple of years ago show impressive results — they have had time to increase their rating. But Etheroll issued their tokens just this year, in 2017. Yet the project’s ICO is in the top 15 most profitable.
Etheroll is a dice game, only high-tech. The game is designed using smart contracts that allow you to place transparent bets, and receipt of winnings are guaranteed. No registrations or deposits are needed to start the game.
The Etheroll ICO took place in February and, apparently, the company caught the trend of gambling games on blockchain. They managed to sell 4.5 million tokens and collect $311,162.00 for project development. The value of the DICE token has increased 46 times in 8 months — at the beginning of the year you could buy a token for $0.70, but now you would pay $3.20 for one token.
Capitalization of tokens so far is comparatively small — around $22 million. However the project is overtaking the market leaders.
*Here and further, data as of 30 October 2017.