Asian Crypto Exchanges See Nearly 99% Of Tokens Trading Below ICO Value
According to a report published by BlockBeats, most of the tokens sold through initial coin offerings (ICOs) that got listed on popular cryptocurrency exchanges in Asia, including Binance, Huobi, HADAX, KuCoin and OKEx, ended up trading below their token sale price, with only a few exceptions managing to rise in value.
98.6 percent of the 264 tokens they investigated fell below their ICO price points by August 21st. The lone exceptions to this disturbing trend were three tokens and stablecoins. These held their initial value or gained at price.
One of the tokens that kept its value is the Huobi Token (HT), which according to CryptoCompare data is currently trading at about $2.08 after rising 1.9% in the last 24-hour period. The token’s ICO price was of $1.52, a nearly 30% rise. On Huobi’s Autonomous Digital Asset Exchange (HADAX), tokens are more likely to skyrocket or plummet in intraday trading, as it reportedly lists “a large number of high-risk projects.”
Whereas, a token with the ticker WBTC reportedly saw its value plunge by 99.86%, as it was initially sold for 4.03 CNY ($0.59) and was exchanging at 0.0056 CNY ($0.00081) last week.
The biggest reason for the slump of most of these tokens is reduced quality schemes that use their funds in an effort to support the token’s value, rather than developing an original product. Although some investors manage to make money on these projects, its report notes, most end up losing almost everything they put in. What many of them do with the money is to deploy funds in an effort to boost their token price. It is rare when they actually put the money to work building and creating the project.