According to statistical data from the ICOdata service, last year ICO projects raised a staggering 7.8 billion dollars. Despite the fact that against the backdrop of venture capital these figures are small, the scale of the new instrument and of the fraudulent schemes applied with its help is staggering. The new form of investing not only captured the minds of hapless stock traders, but also attracted unscrupulous market participants against whom investors turned out to be defenseless.
At the root of the problem, specialists say, lies the lack of regulation of the young industry. And although regulators in various countries tried to warn investors in time about the risks of fraud, the youth of the crypto industry, against the backdrop of absent legal norms, became one of the main causes of the emergence of fraudulent schemes.
As early as 2017, projects began going to ICO en masse with a "one-pager" and a countdown to launch, with a default White Paper and, often, fantastical ideas. However, few were troubled by this: the projects raised millions. Scammers simply could not pass this phenomenon by and took advantage of the heightened interest in the new type of earning on the part of retail investors.
Speaking about the legislative regulation of the crypto industry, specialists note that this could undermine the ideology of the distributed network and the crypto industry, where the anonymity of transactions lies at the foundation of everything. And that the main emphasis in regulation should be the protection of investors from fraudulent ICO projects. Specialists are confident that regulators should establish strict rules for conducting KYC and Due Diligence, provide for rules for auditing ICO projects at all stages of development, and clearly describe the application of AMLA policy. It would also be worth providing for a complete ban or serious restrictions on access to participation in ICOs.
Moreover, experts believe that the absence of qualified investors "buried" the ICO sector even before the intervention of regulators, and that the fact of regulation by itself will not save the industry from scammers if investors lacking the ability to think soberly are present on the market.
In 2018, the most expensive hype after cryptocurrencies became, of course, ICOs (Initial Coin Offering). And what are the prospects for ICOs in 2019? The founder and CEO of Digital Currency Group, Barry Silbert, stated in an interview with CNBC that the prospects for ICOs in 2019 are negligible. "The ICO market is dead. Right now there is no demand for ICOs, and there are all these sponsors who raised a bunch of bitcoins and ethers that they are trying to sell. There are also all these crypto funds that raised funds and now need to settle up," Barry Silbert is convinced. Confirmation of this may be the fact that in January 2019, ICO projects raised no more than $3.5 million, whereas in the first month of 2018 it was possible to attract more than $1.5 billion.
Whether the ICO market has prospects in 2019 is practically impossible to say definitively. While some believe that the ICO era is behind us, unrealized and killed off by inexperienced investors, others assert that the game is still worth the candle, and that a modern decentralized future is just around the corner, where the initial placement of tokens will occupy a worthy niche.
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