2018 ICO Funding Passes 2017’s Total: Good News, Or Is It?

In Q1 2018 token sales have already raised more than they did in 2017, but should we rejoice?

With $6.3 billions raised in this first quarter of 2018, ICOs seem to have already surpassed the total amount of money raised in 2017 through token sales, as reported by Coindesk. Even if we do not take into consideration Telegram’s token sale — which alone collected the staggering sum of $1.7 billions — we are still pretty close to 2017’s total (roughly 85%).

These figures seem to invalidate the assumption that after 2017’s big break, ICOs are now doomed to lose their shine due to extreme riskiness of the investment, impending regulation efforts and the quantity of scam projects all around.

Yet this kind of data should not be received as good news. In fact, as investors rush to put their money on ICOs with the hope to see their investments quadruple, the lack of any form of guarantees for the money invested will — sooner or later — backfire, causing terrible losses.

The terrific amount of frauds and scams have been giving token sales a bad name, and investors have been growing weary of the word “ICO” itself, but apparently the allure of speculation and easy money is still strong.

How much of this $6.3 billions has been poured into worthless projects? How many teams are just here with a “take the money and run” attitude, trying to grab what they can before the bubble bursts?

In the long run, this situation is doomed to become unsustainable, and the ICO model itself — once a groundbreaking way to fund innovative projects — is already suffering of this bad reputation, a reputation that will only get worse when more and more projects will turn out to be a money black hole.

With the ICO uprise in 2017, we soon understood the need to make token sales more transparent and to have some form of guarantees for the participants. We started imagining a protocol for fairer token sales even before Vitalik Buterin proposed the DAICO model, which of course resonates with our idea on multiple levels, and we have been working on a better way to hold token sales for a year now.

As outlined in our whitepaper, CoinCrowd’s protocol actually improves Vitalik’s DAICO proposal introducing the possibility of a second votation, with an Aragon district to solve disputes, and, most importantly, an active token identification algorithm, which only takes into consideration active tokens for the votations, and not the total supply, therefore allowing an accurate representation of the will of the holders.

We believe there is no future for token sales without fairness and actual guarantees, and that’s why we studied a protocol to provide them. Either we change or we die, and CoinCrowd is here to make this change happen.