81% of ICO turned out to be fraudulent

in #crypto6 years ago (edited)

According to the report prepared by Satis Group Crypto Research, about 81% of the total number of ICO launches since 2017 turned out to be fraudulent. However, in monetary terms, only 11% of the approximately $ 12 billion that was collected in these projects fell into the hands of scammers.


Satis Group study 81% of ICO turned out to be fraudulent.jpg


According to the researchers, most of these funds went to three projects, including Pincoin, which received $ 660 million, and Arisebank, which received $ 600 million.

"Despite the fact that more than 1/10 of all fees on the ICO went to fraudsters, the vast majority of these $ 1.3 billion was associated only with two projects that were standard and by no means unique for the ICO industry. Scammers turned out to be the creators of Pincoin - $ 660 million and Arisebank - $ 600 million. Each of these projects received such a sum of money, which obviously should get under the close attention of regulators," the Satis group noted in its report.

Despite the uncertainty of regulation and the decline in market dynamics, the report goes on to say that raising funds through the ICO is steadily growing. Since the beginning of the year, about $ 7 billion has been collected, and this is close to 50% of the amount that was received by the projects in 2017. The most active month for the ICO industry was last December - then $ 1.4 billion was collected.

Satis Group also estimates that the world market of ICO has reached the cost of one-fifth of the market of initial public offerings of securities (IPOs) in the US for half of 2018. And this happens at a time when the US IPO market has registered the highest level of activity since 2014.
Nevertheless, the growth of the ICO market has slowed, and this is due not only to the uncertainty of regulation but also to a decrease in enthusiasm among retail investors. There are also concerns about the technical changes of the main networks, on the basis of which most ICO, especially the Etherium, are created.

The regulatory regime in the United States also does not play into the industry's hands. The closure of the ICO, as well as the talk that the ICO tokens are securities, led many projects to leave the world's largest economy in order to launch in more friendly jurisdictions.

The regions, such as the Cayman Islands, the Virgin Islands, and Singapore, benefited the most from this. Last year, 32% of all ICOs were conducted in the US, while this year their number dropped to 10%. Last year, the ICO share in the Cayman Islands was 3%, and this year it increased to 40%.

In addition, a recent study by a small team at Boston College in Massachusetts showed that only 44.2% of the projects are active five months or more after their ICO. In addition, the ICO remains a matter of concern for regulators. In June, a representative of the US Federal Trade Commission (CFTC) said that consumers lost $ 532 million because of the actions of crypto-crooks in the first two months of 2018, and said that this figure could increase to $ 3 billion by the end of the year.


Thanks for your support.
@san190