There has been explosive growth in the initial coin offering (ICO) sector since the start of 2017. Massive amounts of money are driven into the sector each and every month. January saw the largest ever ICO take place, that of the private messaging app called Telegram, which held a couple of private sales and managed to raise funds of almost $2 billion.
As time has gone on, more institutional investors have gotten involved in the sector as a result of the authorities implementing proper regulations and oversight.
While the cryptocurrency markets as a whole have been struggling since the turn of the year and with the ICO scene also somewhat being dampened, there is still a bright future for token sales according to a co-founder of ethereum.
What are the thoughts of the ethereum co-founder?
Gavin Wood is a co-founder of ethereum and he recently talked to Bloomberg and his belief of how much the ICO sector is going to evolve in the coming years. He believes that the current crypto downturn could actually be a good thing, as projects can now focus on creating their products and services, rather than worrying about how much on they have managed to raise.
There is still a significant amount of interest in the space and those true innovators will be rewarded for their efforts.
With the majority of ICO tokens currently being built on the ethereum platform, Wood is well placed to comment. When it was posed to him that the ICO sector had collapsed, he replied that the sector still “have a while to run” but did say that there was need for the space to evolve in the near future.
To date in 2018, there have been more than $18 billion raised by ICOs, compared to just over $6 billion in all of 2017. The main difference this year is the proportion of these funds going towards token sales that are more established rather than placing a lot of money and trust into blockchain related startups as was seen in 2017.
While there are clearly issues in the sector, it has evolved and adapted so far to date and it the best of the best will continue to rise to the top and receive funding.