Most ICOs out there end up with nothing for the ambitious project starting them as well as their investors seeking quick yet stunning returns on their investments. This is confirmed by the survey conducted by the University of Boston, Bloomberg reports.
All in all, during the research they analyzed 2390 ICOs that took over the last 3 months. The researchers focused on their activity in Twitter. It turned out that 3 months later, only 44% of the startups that initiated their own ICOs over the reporting period are still operating in the global market of cryptocurrencies.
The researchers also found out the safest investing strategy for those seeking to invest in ICOs these days. In particular, they suggest buying coins during the pre-ICO and selling them back during the first day of the ICO. However, in most cases, private investors are forbidden from selling their tokens right after the start of the ICO. This is why they are recommended to get rid of the purchased tokens during the first 6 months after the start of the ICO. This strategy can be really profitable at times, making the investor a fortune. However, this promising upside comes bundled with considerable downside risk since investors have to bet on something that is not there yet. 56% of the coins generated during ICOs eventually cease to exist within the first couple of months of circulation.
According to Coinopsy and DeadCoins, as of late June 2018, over 1000 ICOs can be considered dead.
Aaron Brown form Bloomberg reports that after a long period of monitoring various startups it would be safe to say that 80% of those ICOs end up being fakes scamming people of money, with 10% of them disappearing with investor money even before the ICO expires.
