ICO treasuries have lost $20 billion, according to BitMEX report

16 Jan, 2019 | Updated: 16 Jan, 2019
by David Robb
ICO treasuries have lost $20 billion, according to BitMEX report

The latest in a series of BitMEX reports on ICOs has focused on the treasury balances of token projects. It shows that the tokens that ICO teams allocated to themselves have fallen in value by around $20 billion since launch.

According to the figures, ICO teams have allocated a total of $24.2 billion worth of their own tokens to themselves and their treasuries. These tokens subsequently lost value in a number of ways, including scheduled 'coin burns' as well as sales. The main reason that they have depreciated so much in value is simply due to the reduction in the market price of the tokens, which accounts for a 54 percent loss.

BitMEX' study adopts a critical approach to the way that ICOs have conducted their business, claiming that transparency and standards were lacking. It says that those in charge of the ICOs "were often able to mint, burn, buy, and sell (their own) tokens at will, without analysts being able to easily track what is occuring". Despite the huge downturn in the value of the ICO market, these ICO teams "still appear to own around US$5 billion of their own tokens, money they essentially got from nothing".

Read more: Are ICOs dead? "if you’re not a solid project, you’re just not raising funds"

Including this $5 billion in issued tokens, the study concludes that ICO teams have made around $13 billion in profit, with much of that coming from trading their own tokens for ETH. It suggests that this process is unlikely to repeat itself in future, pointing out that although "Entrepreneurs will remember the success (and keep trying to raise money)...investors will remember the pain"

Read more: 2018: A Bitcoin and cryptocurrency year in review

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