New Report Shows Most ICO Projects Have Been Unaffected by Crypto Market Crash

A new report shows that most ICO projects have been unaffected by the crash of crypto markets. As cryptocurrency prices have plummeted since January 2018, most ICO projects have been able to maintain a steady course.

In fact, many ICO projects are sitting on unrealized gains to this day – even with ETH sitting at a price of $230.

ETH and other popular fundraising cryptocurrencies have lost about 80% of their value since the beginning of 2019. ETH began the year with prices above $1,000. In recent weeks, the price of ETH has slipped below $200 before rebounding to the $220 to $250 range where it sits today.

Despite the wild swings and price drops, however, most ICO project financing has been unaffected. ICO projects aren’t in a state of chaos. They’re not bankrupt. Instead, most ICO projects have been able to navigate the swings of the marketplace while maintaining steady financing.

The new report was released by BitMEX Research earlier today. The report examined Ethereum holdings in ICO treasury accounts.

BitMEX Research first released a report on ICO financing in September 2017. In this follow-up report, BitMEX Research examines how ICO project financing has changed over the last year.

Here’s how BitMEX Research introduces the study:

“We look[ed] at the amount of Ethereum raised and the US$ value of the gains and losses caused by changes in the Ethereum price, for each project.”

ICO Projects Have Sold More than They Raised, Have Unrealized Gains Rather than Losses

The most surprising part of the BitMEX Research project is that most ICO projects have been totally unaffected by the crash of ETH prices.

In fact, most ICO projects have been able to sell just as much ETH as they raised (in terms of USD).

Furthermore, projects are still sitting on realized gains to this day, even with Ethereum sitting at a price of $230 USD.

This indicates that projects raised ETH at a lower price than it sits today. They bought low and can still sell high on ETH. Contrary to what some believe, these ICO projects didn’t raise substantial funds when ETH was at its peak:

“We conclude that rather than suffering because of the recent fall in the value of Ethereum, at the macro level, the projects appear to have already sold almost as much Ethereum as they raised (in US$ terms). Of the Ethereum still held by the projects, even at the current c$230 price, projects are still sitting on unrealised gains, rather than losses.”

In terms of numbers, BitMEX Research analyzed 222 ICOs that have been completed in 2017 and 2018, including the massive ICO from EOS. Here are some of the numbers they came up with, accurate to September 2018:

ETH Raised by EOS: 7,211,776 ETH ($3.824 billion USD)

7,211,776 ETH ($3.824 billion USD) ETH Raised by Other ICOs: 7,972,003 ETH ($1.639 billion)

7,972,003 ETH ($1.639 billion) Total ETH Raised: 15,183,779 ($5.463 billion)

15,183,779 ($5.463 billion) ETH Sold by EOS: 7,211,776 ETH ($3.892 billion)

7,211,776 ETH ($3.892 billion) ETH Transferred Away or Sold By Other Projects: 4,113,345 ETH ($1.560 billion)

4,113,345 ETH ($1.560 billion) Total ETH Transferred Away or Sold: 11,325,121 ETH ($5.452 billion)

11,325,121 ETH ($5.452 billion) ETH Balance Remaining as of September 2018: 3,858,659 ETH ($830 million)

The USD dollar values above are the dollar values at the time the ICO took place. That’s why the 7 million ETH raised by EOS is worth substantially more than the 8 million ETH raised by other ICO projects.

The numbers show that ICO companies, in general, continue to have unrealized gains to this day. EOS’s massive ICO also distorts a lot of these figures. The ICO took place earlier this year, when ETH’s price was substantially higher than it was throughout 2017.

The numbers also show that projects still hold about 3.8 million ETH, or around 25% of the tokens originally raised. In USD terms, the projects have sold about the same amount of ETH as they initially raised – but they still have 25% of their ETH remaining.

Of course, there are some ICO projects that cashed out their ETH immediately. There are other projects that have gradually sold their holdings over time. BitMEX Research’s report analyzes the industry as a whole. Based on their macro analysis of the ICO space, this is great news for the blockchain industry.

Conclusion: This is Good News for the Blockchain Ecosystem

BitMEX Research’s report is great news for the Ethereum ecosystem and the blockchain industry in general. The price of ETH was at $1,400 in January 2018. Since then, the price has slipped to lows under $200 before slightly rebounding to the $230 range.

Despite this huge plummet in price, BitMEX Research’s report shows that most ICO projects have been able to weather the storm. Not only have these projects weathered the storm, but they continue to sit on unrealized gains even when the price of ETH is at $230.

While some argue that ICO projects are in big financial trouble because of the falling price of ETH, the BitMEX Research report, which analyzed over 200 ICOs, paints a much more positive picture.

1/ BitMEX Research publishes a new report analysing the Ethereum holdings of the ICO projects. We establish that the ICOs have already sold almost as much US$ worth of Ethereum as they initially raised. Data compiled with help from @thetokenanalysthttps://t.co/NTXHg10EOj pic.twitter.com/71U7C7zRW3 — BitMEX Research (@BitMEXResearch) October 1, 2018

2/ At the macro level, the ICOs have already realised US$727m in profits by selling Ethereum at a higher price than when received it Despite the peak to trough 85% fall in the value of Ethereum, the projects are still sitting on unrealised profits of US$93m pic.twitter.com/neyc51t76l — BitMEX Research (@BitMEXResearch) October 1, 2018

3/ As the chart below illustrates, many ICOs sold their Ethereum when the price was higher than it is today pic.twitter.com/ix0rAVO7vh — BitMEX Research (@BitMEXResearch) October 1, 2018

4/ The following chart shows the top 20 ICO projects, ranked by the net gains resulting from changes in the price of Ethereum. FIlecoin has the largest net gain, resulting from Ethereum which may have already been sold pic.twitter.com/ggM5FWnA2K — BitMEX Research (@BitMEXResearch) October 1, 2018

5/ It is not a rosy picture for every ICO. The below chart shows the projects with the largest net losses from holding Ethereum. The overwhelming majority of the losses are unrealised. pic.twitter.com/2YyvWAfW3t — BitMEX Research (@BitMEXResearch) October 1, 2018

6/ As ever there are flaws in our analysis: • We may have missed some ICOs

• We may have wrongly assumed that Ethereum transferred out of a projects address cluster was sold

• Many of the figures we provide are estimates We apologise for any inaccuracies — BitMEX Research (@BitMEXResearch) October 1, 2018