ICO Fund Falls Below $100 Million in Jan 2019, Dying or Changing?
Recently, the market for initial coin offerings (ICOs) is eerily quiet under the double pressure from both the governmental regulation issue and currency crypto bear market.
According to the data from ICORATING, the global ICO market has just raised $76 million in the first month of 2019, representing a decrease of 94.1% year on year.
In January 2018, the capital raised by ICOs reached $ 1,289 million which is 17 times of current amount.
Most of the insiders believe that the rise of STO (security token offering) accelerates the ICO flop. As an obvious transition is taking place in the digital token market, investors are becoming more wise and rational.
“As they continue to mature and people become more familiar with blockchain technology, we expect STOs to become more prolific,” said Eric Ervin, CEO of Blockforce Capital.
In addition, many countries have strengthened their regulation over ICO market. On January 15, 20019, Malaysia’s Securities Commission (SC) announced that it could categorize cryptocurrencies such as Bitcoins as securities.
“Any person offering an ICO or operating a digital asset exchange without SC’s approval may be punished, on conviction, with imprisonment not exceeding ten years and fine not exceeding RM10mil,” said the minister of SC.
According to SC, a complete legal framework for the cryptocurrency industry would be released by Q1 2019.
On January 31, South Korea financial regulator the Financial Services Commission (FSC) confirmed that the country will continue to ban ICO citing lack of stability and ease of manipulation.
Moreover, The Organisation for Economic Cooperation and Development (OECD) has also called on global regulators to work together to facilitate the development of initial coin offerings (ICOs), according to a report released Jan. 15.
Nevertheless, some of the crypto adherents considered that ICOs aren’t dead, investors are just doing more due diligence and looking for more credible and vetted blockchain projects, and the fundraising model in blockchain industry keeps evolving, and STO may be a better way at this stage.