The initial coin offering (ICO) sector has experienced massive growth since it first came to prominence in 2017. These tokens were snapped up by investors who were looking to get in on the action. This was at a time when the cryptocurrency market as a whole was taking off, so there was a lot of bullish sentiment around.
A lot of companies who probably had no place holding an ICO decided to jump on the hype train and raise funds through an ICO. Ultimately as this was an impulsive decision a lot of the times they struggled to hit their targets and this led to their token prices taking blew their ICO price.
Now some interesting research has been released which showcases how 98.9% of all altcoins in Asia have fallen lower than the price they were selling for during their ICO.
What are the details about this new research?
Most tokens which are issued as a result of ICOs will eventually be issued on the cryptocurrency exchanges found throughout Asia. Some of the biggest exchanges in the world are located there, such as Binance and KuCoin. However, a lot of these tokens according to new research show that they end up being priced on the exchanges below what people paid for them during the ICO itself.
BlockBeats is a company that conducts research on the cryptocurrency markets and they looked at 264 different tokens and they found that 98.6% of them ended up being listed on exchanges below what their ICO price was. Those which were the exception were stablecoins and three other tokens that had either stayed at the same price level or increased.
This led to losses on average of anywhere from 70% to 98% of those who invested during the ICOs, which is a significant investment loss in any case. One of the tokens that managed to stay above this mark was HuobiToken. Its ICO price was around the $1.52 mark and now it is hovering in the region of $2.10.
While it may be a different story for coins that are launched elsewhere, those launched in Asia have had a hard time of things and is something is definitely to be noted by those ICO investors that are looking at the region for potential investment opportunities.