More Than 50% of ICOs Die in 4 Month

'The majority of ICOs do fail', researcher from Boston College says
10 July 2018   369

About 56% of ICO start-ups ceased to exist during the first four months after the end of the tokensale. This is reported by Bloomberg.

ICO Funding by Month
ICO Funding by Month

First of all experts appreciated the activity of ICO-projects on Twitter. It turned out that 120 days after the fundraising only 44.2% "survived" .

According to analysts, the most secure investment strategy for various tokens is the sale on the first day of trading. Either way, almost all investors get rid of coins purchased under the ICO in the first six months.

What we find is that once you go beyond three months, at most six months, they don’t outperform other cryptocurrencies. The strongest return is actually in the first month. They are much lower now, so I wouldn’t expect them to continue to decline at this rate. People often look at returns and say this is a great deal, but we teach in finance that return is a compensation for risk. These are stakes in platforms that have not yet been built, that have no participants yet. There’s a lot of risk. The majority of ICOs do fail.
 

Leonard Kostovetsky

Researcher, Boston College

More than 1,000 tokens have already ceased to exist, and return on investment is steadily declining.

It should be noted that the monthly investment in ICO projects still holds above $ 1 billion. This trend has been maintained since the beginning of 2018.

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SEC to Slap ICO Founder With $30K Fine

Additionally, David Laurance, founder of Tomahawk Exploration LLC got 2 lifetime bans
15 August 2018   118

The US Securities and Exchange Commission (SEC) on Tuesday reported that it has issued two new bans directed against David Laurence, the founder of Tomahawk Exploration LLC. Tomahawk allegedly stands behind fraudulent ICO, writes CoinDesk.

Laurence, according to the SEC, raised funds through the sale of Tomahawkcoin tokens, in the process of using misleading advertising materials and fraudulent statements that it is a tenant of drilling sites.

Moreover, the sale of Tomahawkcoin tokens, according to the SEC, was accompanied by a false promise that "the holders of tokens will be able to exchange Tomahawkcoin for shares and receive a potential profit from oil production and secondary tokens trading."

According to the SEC, Lawrence neither acknowledged nor denied the charges, but he and his company agreed to these bans, as well as a fine of $ 30,000.

...Tomahawk issued tokens as part of the Bounty Program to generate interest in the ICO, which benefited Tomahawk. Distribution of tokens that are securities in exchange for promotional services to advance the issuer's economic objectives or create a public market for the securities constitute sales for purposes of Section 5 of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder.
 

SEC

The first prohibition of the SEC is a ban on the director's work in public companies, and the second does not allow Lawrence to own and trade in so-called "penny" shares. Both prohibitions, according to the announcement of the SEC, are lifelong.