Beyond FOMO: Venture Capitalists seize low price environment to invest in ICOs

Venture Capital investments up +100% QoQ in Q3, 2018.

Source: InWara’s Finance Sector report

Q3 2018 Private Funding hit an all-time high

Companies behind ICOs have strongly preferred investments during Pre-Sales vs. Token Sales. In 2017, 630 ICOs conducted a pre-sale round as compared to 957 ICOs during YTD 2018, over 60% increase.

Source: InWara’s Finance Sector report
Source: InWara’s Finance Sector report

Blockbuster ICO on the rise

There are also certain ICOs that have raised hundreds of millions — even billions without even having any working prototype.

Big investments in Private funding in last two months

Seba Crypto in September

Seba Crypto raised $104 M in a Venture round from investors Black River Asset Management and Summer Capital in last month.

Coinbase in October

Coinbase raised $300 million in a Series E round from investors Y Combinator, Andreessen Horowitz, Tiger Global Management, Wellington Management, and Polychain.

Source: InWara’s private funding database

Corporate venture wings want a bite too

From just speculations a few years ago to raising over $2 B during 2018 alone. ICOs are becoming impossible to ignore even by the risk-averse Institutional financing community as the token sale shifts to private Sales and STOs.

To Sum it up

This shift of preference is a mixed bag. The brighter side to this is the risk is shifted from individual investors to accredited institutional investors and on the other side, it is still risky as regulators still haven’t fully weighed in on them.

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Building DeFi and crypto products | Thought Leader Hackernoon, Bitcoin Market Journal | Most viewed Crypto Columnist on Quora

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Syed Shoeb

Building DeFi and crypto products | Thought Leader Hackernoon, Bitcoin Market Journal | Most viewed Crypto Columnist on Quora