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Three Reasons Why The ICO Market Is Cooling Down, But Crypto And Blockchain Are Here To Stay (forbes.com)
ICOs (Initial Coin Offerings) are one of the hottest topics of the year because it’s an easy way to raise cash and it’s largely unregulated. Even last night at Red Bar + Restaurant, a rooftop bar at the International Finance Center in Hong Kong, I heard chatter of different upcoming ICOs to invest in.


Over $3.5 billion dollars have been raised to date via ICOs. In 2017 alone, $3.2 billion was crowdsourced. Top projects like Filecoin ($206M), Tezos ($232M), EOS ($180M), and Bancor ($154M) are taking the lion’s share of the funding. Raising $1-10M as a small startup just getting off the ground becomes very achievable.


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CoinDesk


Over $3.5 billion dollars have been raised to date via ICOsIt was a red hot summer with $462M raised in June, $575M in July, and the peak was reached in September with a whopping $663M of ICO funding.

ICO Cool Down


Coin offerings only started to cool after September 4th, the day the People’s Bank of China placed a ban on ICOs. In fear of upcoming regulations, only $516M was raised in October and so far $486M in November. ICOs are still operating in a legal gray area. However, the industry is moving fast to develop standards for a compliant framework for token sales. Projects like the SAFT (Simple Agreement for Future Tokens) help navigate U.S. laws.



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CoinDesk


The ICO market starts to cool down in fear of upcoming Chinese regulations.In the hot days of ICOs, you could buy tokens at the ICO price and in the first month flip that for a profit. Discounts of 10-20% are frequently given to those who participate early during the token sale period.


Those that are lucky enough to get into the ICO pre-sale may even get a 30-40% discount. When these tokens finally get listed on an exchange, some portion of people who initially invested into the ICO will sell their tokens for a profit.


Flippers flooded the market. Now it’s common to see the token values decrease as they get listed on exchanges. Bancor’s ICO price was $3.86 and dropped as low as $1.38 in their first month of trading. Many projects running ICOs are now enforcing lockup periods based on the size of the discount to maintain a stable token price.


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CoinMarketCap.com


Bancor’s ICO price was $3.86 and dropped as low as $1.38 in their first month of trading.


With scams ongoing, the public is generally wary of putting money into an ICO. The SEC has charged two ICOs with fraud. Tezos has been hit with two class action lawsuits. There is a lot of skepticism around projects that are being created now. Do they really need to be on blockchain or are they looking to get rich from ICOs? More than just a white paper is needed.


You have to have a solid team, a solid prototype or users, and some sort of self-governance for investors to be confident in you.


Crypto and blockchain are here to stayHowever, the blockchain and crypto community remain absolutely unfazed by this. Last week, I attended the 2nd annual Blockchain Conference in Hong Kong. Everyone in the industry was more energized than ever about the potential opportunities with blockchain. I had conversation after conversation with entrepreneurs about how disruptive this technology is.


They believed this well before the ICO hype.AI has been absolutely on fire the past few years. But the power of this technology has largely been trapped inside of big companies. The data, the research, the computing power, etc., is all centralized in companies like Facebook, Google, Microsoft, or Amazon.


This means the latest advancements in this industry are in the hands of mega corporations and they are hoarding it for themselves.


Hello decentralizationAI advancements needs to come out of these big companies and come into the hands of the community.Smart folks like the team at Ocean Protocol are working on this problem. Ocean is a protocol and network that incentivizes users to provide a vast supply of high-quality data. The data is used in training artificial intelligence models.


Separately, there’s the team at 
Trane.AI working on a decentralized way to tag, store, and model data.
I’m one of the co-creators of the Raven Protcoldecentralizing and distributing deep-learning training. The protocol will proliferate the adoption of AI and grow the ecosystem. Companies will achieve over 100X faster training of deep neural networks and will be 50X more cost efficient.


The marriage of AI and blockchain is inevitable and will be celebrated in the days to come. They’re two fundamentally disruptive technologies and we’re doing our bit to expand the horizon.


With or without the hype, ICOs are one funding mechanism to fuel new companies brave enough to stand shoulder to shoulder with the incumbents and challenge them at every step to build a brighter future.


It will leave us with the next wave of disruptive technologies in the way the dot com bust left us with Google, Amazon, and Ebay.

Discover more articles about the blockchain at Forbes here: https://www.forbes.com/sites/outofasia/2017/11/27/three-reasons-why-the-ico-market-is-cooling-down-b...