A new study by Boston University revealed that half of the crypto startups that collect funding through ICO 'died' after four months of being put on the koinin market.
44% of the ICO Projects 120 Staying Alive Over Time
The most popular way of raising money for the next generation of technology companies is now the ICO method. And now this sector is starting to flood with coins that will never be listed on a stock exchange. The first ICO project was on the market five years ago, but most users may not have heard it until 2017.
Last year, the amount of money collected by the ICO method amounted to 400 million dollars, even though it was only in March 2018. The reason is that ICO projects have been making so much noise since 2017, It was 4 billion. For the summer months, this amount was recorded as 1.3 and 2 billion dollars for just two months.
In a study conducted by Boston University, the number and intensity of the startups tweets were measured. The main reason for this is to measure the life span of these projects. It turned out that only 44.2% of the completed ICO projects survived over 120 days. Hugo Benedetti and Leonard Kostovetsky named researchers focused on the 2,390 ICO project completed before the month of May .
According to Bloomberg 1.000 koin regulatory problems, either because of bad financial management or basically starting out with a bad idea at the beginning.
80% of ICO Projects Fraud
Written for Bloomberg Prophets Aaron Brown In an e-mail, there are a number of startup projects that initially set off as fraud and fraud.
"I admit that 80% of ICOs are fraudulent, 10% are not as important as their competitors, so I will sink shortly after I collect the money. The remaining 10% will most likely fail again. "
Boston's study does not begin with an ICO project, but it is the most logical way to invest in it. Kostovetsky explains:
"What we find once over three months, at most 6 months, these projects can not pass the other crypto bills, the highest earning actually occurs in the first month."
which is much lower than the past histories, which could reverse the rate of failure found in the survey. This finding suggests that startup companies may have changed the path they followed after completing the ICO.
Kostovetsky describes this as
"People are often looking at the return of earnings and they say it is a good offer, but we are teaching that the return to finance is a compensation for the risk."