Comments made by Vitalik Buterin have been hitting the headlines lately after he said that 90% of all token projects launching on the Ethereum platform would ultimately fail to provide any returns for investors.
But is this an accurate statement? That's what I'll be addressing in this video.
DISCLAIMER: This is NOT financial advice. I am just offering my opinions. I am not responsible for any investment decisions that you choose to make.
***I am in the process of adding many of my videos from YouTube on to DTube. Apologies for any posts that you've already seen before!
Original date of upload: November 2nd 2017
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I always said at least 90% of ICO’s will fail or willhave zero return for investors. You just have to be well informed, educated about specific ICO you invest in and of course diversified.
Information is not enough, a lot of these ICO's are based on speculations and its not just enough, the main clauses are what Vitalik mentioned in his interview, and i fear they werent taken deeply into consideration, hence Vitaliks statement
There are few thing I try to get informed about specific ICO. For example, why are they doing this? If it’s simply to provide a return on an investment, then buyer beware. If they lay out a clear vision where the value proposition is easily understood this would be a good sign. What has the team executed on in the past, together? It should first and foremost be technology related. You should be able to quickly look this up on the net. How much crypto are they offering to the public? Gauging demand for a crypto is key. Not everyone is going to want to take a position in it...
It us no secret that from the almost 1600 cryptos lots if them are just frauds. I wouldn’t be surprised if that statement comes true eventually
A year back there were not even half
I’ve heard that already a few times. On one hand it’s scary. On the other hand this is called unregulated and decentralized market right? You just have to do your homework if you invest in one of those, or if you like to gamble, just buy a bit of I’ll of them lol
If you judge "success" by gains down purely to short term speculation then the figure is probably a lot lower . If this is the case then be aware that you are backing a pump and dump and get out a.s.a.p. In the real world most startups in mature markets such as software, biotech and electronics fail. They fail for a number of reasons ; because they miss milestones, a better technology comes along, the product fails, they run out of money,or they are just unlucky. By contrast crypto is a very immature market with as yet few working products and plenty of "dodgy" ICOs and coins.Consequently I think that the attrition rate will be huge and I sincerely think Andreas's prediction is nearer the truth.
When i first saw that headline, i was skeptical, but if the landlord of ETH says so then...uhmm...
I think Vitalik is right, there are many shitcoins today. Cryptocurrencies are being created for anything and in addition many ICOs are scams.
It seems to me that in the future only will survive cryptocurrencies that fulfill certain useful functions efficiently, the rest should disappear, maybe that will be positive for the market.
I think that on the long road he might be right(like the dotcom bubble), but in the short term people can get profit from good ICOs if they DTOR.
Some may have benefits, but others will also lose money. Mainly because ICOs are generally long-term investments
inserting a photo of Alejandro eating a cookie hahahaHi friend, yes, obviously no all ICOs generate fast benefits, but some of them could, for example the Telegram ICO has a lot of potential to pump.
The telegram ICO has something suspicious, the first sales were private and in the public sales the price of the token will be higher than the initial one. As soon as the token enter in an exchange, the first investors can dump the price by selling their tokens because they would already be earning a lot.
Can either of you please state any ICO that has earned him/her or a friend profit? I see money being lost, not sure about you
Wings
thanks
He's probably right. Maybe 95% of IPOs during the dotcom bubble weren't profitable, but the 5% that were, were hugely profitable. Buy quality.
Mimics the stats of start ups it seems. 90% fail in the first year, another 90% within five years or something like that.
personal opinion
When a cryptocurrency startup firm wants to raise money through an Initial Coin Offering (ICO), it usually creates a plan on a whitepaper which states what the project is about, what need(s) the project will fulfill upon completion, how much money is needed to undertake the venture, how much of the virtual tokens the pioneers of the project will keep for themselves, what type of money is accepted, and how long the ICO campaign will run for. During the ICO campaign, enthusiasts and supporters of the firm’s initiative buy some of the distributed cryptocoins with fiat or virtual currency.
ICO's have always been a risky proposition. But they have made a lot of people rich and even more have been scammed . The thing is the stories of riches are far more pervasive and they will keep luring a lot of people to the ICO's for a good long time
its really great analysis ,,
dear sir
An Initial Coin Offering (ICO) is used by startups to bypass the rigorous and regulated capital-raising process required by venture capitalists or banks. In an ICO campaign, a percentage of the cryptocurrency is sold to early backers of the project in exchange for legal tender or other cryptocurrencies, but usually for Bitcoin.
Maybe it can become true, there are many projects with tokens, where some come to return the investment, but it is only a matter of time to know the answer.
I never have invested on an ICO but I have friends that did through they own research and after release they got profit, so I think that polemic declaration is wrong.
In wich ICOs did they invest?
Vitalik making noise again.. Amazing post @louisthomas
I have not seen the video probably this statement out of context although taking into account the current situation of ICO regulations may be right
As usual prudent advice. ( Oops...not advice !!)
Most will not survive. Some will survive but still prove to be a poor investment. For example may good companies ( efficient, ethical, productive, responsible and economical sound) in fact prove to be poor investments; if one regards a good investment as a good return on the dollar. It is is possible that even BTC and Eth may end up in that last catagory!
its really great post of a ico investor,,,its have to fall 90 % of ios for any investor,,,
The central bank said tokens cannot be used as currency on the market and banks cannot offer services relating to ICOs. As a result, both bitcoin and ethereum tumbled.
Buterin has previously emphasized that he considers the centralization of development in ICO projects as a serious flaw in many ERC20 token-based projects. While the Ethereum blockchain, the base infrastructure which supports the ERC20 token standard is decentralized, ICO projects are conducted by a closed group of developers, or in many cases, companies funded by venture capitalists
This mirrors the failure rate of venture funded startups. About 70% of venture funded startups simply fail. Everybody loses most or all of their investment. Another 20% "break even" either through getting bought out at a discount or having assets sold to cover creditors and investors. 10% get to a successful exit where the investors get their money. This one winner in ten also has to make up for the losses from the other nine.
So I am going to say the Vitalik was being optimistic. Take away the frauds and stupid projects just grabbing for money and you already lose a big chunk. This is still such a new and rapidly changing technology that I would not be surprised that even plausible ideas and projects will fail at a higher rate the VC funded start ups.
It depends on what your definition of 'fail' is. For me personally a successful ICO isn't one that raises their desired amount of funds but rather one that is still around in 5 years and providing actual utility.