Q1 ICOs: What’s the Story?

The news articles are starting to trickle in: “ICOs stall, crypto falls”, “More forks than an estate sale, more airdrops than Normandy” are the two funniest of the various doom-and-gloom headlines. I prefer the more data-driven and less apocalyptic information from ICOBox. It’s worth a read. But what’s my take on the first quarter’s token events?

I’m not sure I’d call it a “stall” since more money developed through Q1 TGEs than in Q4 and both more deals and more money than Q3 is a powerful statement. Two big things are drawn out for me:

The first is that deals and dollars were stronger than Q3 in spite of advertising bans. Facebook banned crypto ads on January 30, Google and Twitter filled later in the quarter doing the same thing. That’s a strong statement that crypto investors aren’t swayed by Facebook, Google, or Twitter ads, which should be alarming to all three companies. It’s also positive that a large, engaged audience is essential to a crypto-driven business.

The second is that deals and dollars were stronger than Q3 in spite of a bear crypto market. The entire quarter for cryptocurrencies was a bloodbath — every currency dropped consistently all quarter — yet deals and dollars beat Q3, which was the squarely in the hype and buzz of a bull market.

I don’t see the stall or failing or death of token offerings. That’s not to say the future is certain or bright: the regulatory morass caused by some countries is doing innovation no favors and no one really talks about the elephant in the room — how the cost of getting traction has skyrocketed. Some of that cost is the massive inflation in professional help — legal, tax, advertising are all three, four, or 10 times the cost compared with last year, and while some can be attributed to the regulatory environment, some is straight-up profiteering.

Remember the first millionaire of the California Gold Rush? (Hint: he didn’t mine for gold.)

About Dana Love: I am currently digital officer and CTO of MentorCloud, Inc., where my responsibility is the strategic design, development, and delivery of MentorCloud’s digital capabilities, data and analytics, client-facing technology and digital experiences across the firm’s global business. I hold a in economics, an MBA in management and marketing, and a BS in physics. My research is in public policy, most recently the impact of blockchain and big data on emerging economies. Some of my past efforts include building the first cloud-based ERP system (in the mid 90s), intelligence analysis on behalf of the US government, development of the first carrier-grade VoIP and unified communications platforms in the world (at GTE, now Verizon), and early work in big data systems (as an Oracle partner.) My work in big data, machine learning, , and VoIP has been written about in Wired, Oracle’s Profit Magazine, the Financial Times, and Telephony Magazine.