Initial Coin Offering (ICO) performance was in part characterized by “overall disappointment” in the third quarter of 2018, according to a study from ICO analysis firm ICORating published Nov. 15.

As the report states, Q3 2018 saw 597 ICOs raise over $1.8 billion, a notably lower value than the over $8.3 billion reportedly raised in the previous quarter. A similar decline in investment has been reported in traditional Venture Capital (VC) funding for blockchain projects.

In the report, the decline in funding is accompanied by a median return on investment (ROI) of -22 percent in Q3 2018. As the report states:

“The same indicator was +49.32% in the 1st quarter and −55.38% in the 2nd quarter.”

Regulation is in part cited as a cause for the downtrend, with the increasing crackdown on this fundraising method by the U.S. Securities and Exchange Commission (SEC) putting “hundreds” of projects at risk.

In June of this year, the SEC’s chairman stated that while Bitcoin (BTC) is not considered a security, most ICO tokens probably are, requiring their issuers to register with the Commission.

During Q3 — from July to September 2018 — ICO funding overall has fallen by 48 percent. A more significant fall of over 78 percent was reported in September — the last month of the third quarter — when compared with May, the middle of the second quarter.

ICO funding and success. Source: ICORating

ICORating’s report also stated that 57 percent of ICO projects that raised funds in Q3 were not able to secure over $100,000.

Of all the tokens sold to investors during an ICO in Q3, just 4 percent ended up listed on exchanges, compared to 7 percent reportedly listed in Q2 of this year, ICORating notes.

The report also mentions that 19 percent of “projects with previously announced ICOs” in Q3 have deleted their websites and social media accounts, a reported 10 percent more than in the second quarter. Those projects that disappeared after collecting funds attracted 3 percent of the total ICO funding in Q3, which amounts to about $62.1 million, the report states.

The research also covers the stages at which projects tend to start their ICOs: of all the projects included in the study from Q3, 76.15 percent were at the “idea stage” when they ran their ICO – 18.72 percent more than in the previous quarter.

When it comes to the choice of the platform for token sales, Ethereum remains king with 83.75 percent of ICOs choosing to release their token on its blockchain.

Looking more broadly to the last year, the ICO market has been fluctuating, registering two peaks concerning both the number of projects and amount of capital raised in December 2017 and March 2018.

As Cointelegraph previously reported, funds raised by ICOs during October increased 26 percent when compared to September, from $403.1 million to $508.54 million, despite only 54 projects having raised $1 or more.