While global funding has been decreasing slightly over the last few years, ICO funding started gaining traction in 2016, and then exploded in 2017, where it increased from $228m to $2.8 billion. The number of rounds has quadrupled and is nearly reaching 150.
According to the report, even though the U.S. and China are the most restrictive countries in the world when it comes to ICOs, so far, in 2017, North America and Asia have rounds almost twice as large in comparison to Europe. ICOs are generating significantly larger rounds when compared to early stage funding rounds – angel, seed, crowdfunding, and even A+.
The first top ten countries for ICOs are United States, Switzerland, Singapore, Canada, China, Estonia, Russia, UK, Hong Kong and Finland.
Looking at the industries that are raising funds through ICOs, the vast majority of the companies are related to financial services and cryptocurrencies.
Beyond them, gaming companies, as well as companies related to big data, AI, and media have raised funds via ICO.
North America has the most funding out of all regions raised by ICOs, almost twice as much as in Europe. The overall share of total funding raised by ICOs is almost twice as high in Europe reaching 3,83% compared to just 2% in North America. In Europe, Switzerland has seen the highest number of ICOs, with a total of 13. This is just ahead of the UK, who had 8 ICOs and a total of $71m in ICO funding. In general, mostly Western European countries have started adopting ICOs, one exception being Estonia with an impressive 4 ICOs from the tiny nation.
The most funded companies are:
- Filecoin, a US data storage network and electronic currency based on Bitcoin, which raised $257m
- Tezos, a US decentralized blockchain that governs itself by establishing a true digital commonwealth, with $232m
- Bancor, a Swiss protocol for the creation of Smart Tokens, a new standard for cryptocurrencies convertible directly through their smart
contracts, which raised $153m
- The DAO, a decentralized autonomous organization which works as a decentralized fund management investing in blockchain projects, which raised $152m
- Kik Interactive, a Canadian maker of an app that lets users connect with friends, groups, and the world around them through chat, which raised $97,5m
- Status, a Swiss based mobile ethereum OS, which raised $95m
- TenX, a Singapore based service to spend cryptocurrencies, which raised $83m
- PressOne, a Swiss-based decentralized content publishing platform, which raised $82m
- KyberNetwork, a Singapore based system which allows the exchange & conversion of digital assets, which raised $60m.
Having a look at the average performance of ICOs to date, according to a report by Luxembourg-based venture capital firm Mangrove Capital Partners called “Tokenisation: Implications for the venture capital industry“, it has been nothing short of outstanding. If one had blindly invested €10k in every visible ICO, including the significant number of ICOs that failed, this would have delivered a +13.2x return.
This happens in the cryptofinance world, which combines both promise and danger, where skepticism is high due to transparency lack and regulation with hard to find good deals, with many of them resulting being scams. By doing in-depth research about team members, their tech expertise and their connections can help people make sure that ICO they are going to invest is reliable.
To this end, there are a lot of platforms that rate ICOs. But this has not avoided scams to happen. To unlock a new layer of trasparency, a Russian startup called Revain is now involved in building a service that allows people to have a look at other users experience, evaluating the progress of ICO-backed companies by taking into account:
– token exchange rate dynamics,
– taking into account the timeline and milestones,
– team work with clients and partners,
– reaction to criticism and feedback.