Blockchain companies need to start delivering

The message that 2018 is going to be a great year for crypto is still reverberating around internet hallways, after all, 2017 was so good for the ICO space. We are now 6 months into 2018, the market is bearish and we are still waiting for post Consensus 2018 promises to kick in. But this is the year for crypto right? So, when will blockchain companies start delivering?

If you’ve been involved in this space for a while, you would have certainly seen the increasing number of successful ICOs raising unprecedented amounts. Indeed, 2017s total investment of $5.6 billion serves to echo this, but how do we measure this success and do overwhelmingly large investments translate into product delivery? Unparalleled cash injections and huge average returns could serve to defend what ICOs have achieved on a purely speculative level. A report from VC Mangrove Capital in 2017 announced an average +13.2x return for investors, had they blindly invested in every ICO to date, including those that failed. Many token holders that saw returns bought in early 2017 before the ICO hype and decent returns have indeed been made. The overall interest in ICOs has led to an overwhelming number of ICO projects but this doesn’t mean they are going to deliver.

“…we have definitely promised a lot and now it is up to us to deliver”

@IvanOnTech -  

Equally, in February 2018, Bitcoin news reiterated a 46% failure of crowdfunded projects. Not all of them reached their targeted amounts and some only managed to crowdfund a few thousand dollars. Not all projects go the distance and so many of them were shitcoins or even worse, scams. One could argue as well that failure exists in other sectors and that is not specifically reserved to the crypto space. According to the Bureau of Labor statistics, traditional entrepreneurship also faces similar difficulties with failure rates of 21.2% in year 1, 32.1% in year 2 and 51.2% in year 5.

Crypto, tech and financial publisher “The Merkle” recently reported findings gathered from various interviews with Blockchain project CEOs and co-founders. [This article] (https://themerkle.com/why-do-so-many-icos-fail-heres-what-the-experts-say/) outlines the main reasons for failure as: insufficient market research, lack of experience and finally, actually having a minimally viable product — the latter was echoed by two of the interviewees.

This year also marked the fourth annual Blockchain Consensus conference. With 4 times more attendance than 2017, many were anticipating the positive effects to ripple through the cryptocurrency markets and bolster blockchain interest as a whole.

However, as is often the case, things don’t always go to plan.

With consecutive bull runs after each previous conference, speculators were expecting similar trends in 2018.

But whilst hype and predictions about future price have a role in this space, it is important to bear in mind the old adage “past performance is no guarantee of future results.” Expecting 2017s ICO boom and the post-Consensus event to drive a market rally is not sufficient. The onus is also on blockchain companies. It is essential not only that they begin delivering viable working products, but that they also reduce dependency on public funding in order to get a project off the ground.

Yesterday’s NewsBTC’s article, announced that Binance had formed a $1 Billion investment fund intended to finance blockchain projects that solve real problems, scrutinize them and help weed out ICO scams. Similar governmental infrastructure in France also makes it possible for nascent businesses to get necessary support through project incubation, funding and deferred 0% loans.

Speaking for ourselves, we wanted to demonstrate that we had a long-term vision. Moonify’s philosophy entailed delivering a tangible product and not relying on public funding too early. An ICO is under discussion but we first saw the need to have a working product, far beyond simple storytelling like many ICOs out there. It’s not the easy way but we are convinced that it is the best way to do it. For those in the know, we call it PoRWP which stands for Proof Of a Real Working Product :)

Here in France, French entrepreneurial infrastructure acts as a cornerstone for technological advancements and serves to legitimize newer blockchain projects to help separate the wheat from the chaff.

It’s not all doom and gloom in the space though, there is some good news. EOS, software has introduced blockchain architecture for the scaling of DAPPs and Block.one is sticking to their roadmap and has delivered their EOSIO 1.0 Release.

Tron is also undergoing transition from the Ethereum network and launching their own mainnet. It officially launched on 31st May and goes by the name of Odyssey 2.0. Whilst it is still in a beta stage, migration of ERC-20 tokens will begin in June.

It is fantastic to see projects like EOS and Tron come to fruition and whilst they were subject to token sales it is a promising sign that certain blockchain projects are materializing and making promises on their delivery. ICOs are risky and hype around this new type of crowdfunding has lead to investment in projects that do not have anything tangible about them. Working products with proper solutions to real-life problems are far more viable when looking for an investment opportunity and won’t deceive the nascent but promising blockchain and cryptocurrency sectors. To keep up to date with developments, please feel free to follow us on Twitter or visit Moonify.io to learn more about our platform.