Chinese Entrepreneurs Scramble to ICO as Crypto ‘Ice Age’ Threatens Blockchain Market
Harsh regulations, poor crypto prices, and even a spate of bad projects have reportedly made Chinese entrepreneurs desperate to launch ICOs, China Money Network reports:
Despite a Chinese government ban of ICOs, which is essentially a way for new blockchain projects to raise capital via issuing new tokens to investors, ICO projects have continued in the Chinese crypto community. Some projects started by Chinese teams are registering entities overseas and target overseas investors to raise capital. Others aim to raise capital from qualified investment institutions in China, instead of from individual investors, which is now prohibited.
There is a clear perception that the window for ICOs is closing, and new projects are scrambling to get token issuance done before it shuts completely. For the dozens of people who China Money Network chatted with, almost everyone is planning or helping one or more ICO projects.
Crypto investors are apparently expecting a coming blockchain “ice age,” a regime which one anonymous investor says will “clean out the market place.”
I’m not sure why that’s a bad thing. As China Money Network points out, 46% of ICOs last year either flopped at the funding stage or folded shortly after. Another 13% “semi-failed,” a metric which I find fully amusing, while nearly 90% of them have seen their prices fall well below their ICO price. If anything, a cleanup will help weed out the Pets.coms from the Googles of the ICO world. As always however, everyone – except for the outright frauds – seems to believe they have another Microsoft on their hands.