Fundstrat’s Tom Lee Says Waning Interest in ICO Tokens is a Good Sign For the Market at Large
As per data released by ICObench recently, fundraising numbers associated with methods such as ICOs have continued to decline since the start of 2018. Not only that, even the sale of crypto tokens across the globe have fallen by a whopping 90 percent over the course of the past 12 months or so.
A Detailed Look at the Statistics
When looked at closely, we can see that the aforementioned research data presented by ICObench puts forth quite a few surprising findings such as:
- All through the first quarter of 2018, ICOs were able to raise a total of around USD $4.75 Bln.
- In the same vein, since the start of 2019, token offerings have only been able to raise a relatively meagre sum of USD $575 million.
- At presstime, it appears as though the number of crypto projects being released (for the masses) are rapidly declining. For example, we can see that during December 2018, a total of 248 ICOs took place. However, since the start of 2019, this number has reduced to just 238.
— Rebecca Ungarino (@ungarino) March 17, 2019
More on the Matter
In a recent interview with perennial crypto bull, Fundstrat co-founder ‘Tom Lee’, the finance guru suggested that as we move deeper into 2019, more and more crypto-oriented startups will move away from token sale-based acquisition models in favour of “equity raises”.
In addition to this, while conversing with the folks over at CNBC last week, Lee spoke at length about the future of the crypto market (through 2019) as well as the short-term future of some of today’s premier crypto assets such as BTC, ETH etc. In this regard, Lee was quoted as saying:
“We believe 2019 is a year of repair, setting up for a strong recovery in crypto prices broadly in 2020. Any improvements in supply/demand dynamics is positive for prices and hence, the slowdown in ICO funding is a net positive. Sentiment is also quite muted, which is positive.”
Other Key Takeaways
- Many experts are of the opinion that ICOs are no longer being used by startups since they lack any intrinsic “utility or value creation capabilities”.
- According to Barry Silbert, CEO of Digital Currency Group, most of the ICO tokens that became famous during the crypto boom of 2017 will most likely drop to “zero” in the near future.
- Similarly, Global Head of Research for Bitwise ‘Matt Hougan’ shares Silbert’s view and believes that more than 95 percent of all cryptocurrencies will die out sooner or later due to a lack of real world use-cases.
In closing out this piece, it is worth pointing out that if the aforementioned predictions made by people like Silbert and Hoguan do come true, we could be witnessing the demise of the ICO market as we speak. Only time will tell, how the future of this domain now plays out.