In an attempt to better understand the ICO process and possibly receive new insights, a social media intelligence company called Singularex has investigated 1200 ICOs that have occurred in the last three years. The company was researching 100 different factors that may have an influence on an ICO and their results and has managed to narrow the list down to 4 crucial aspects that have a say in how an ICO will perform.
Last year, various ICOs managed to raise as much as $6.8 billion. Before, they represented only a needle in a haystack that was all the venture money that US startups have managed to raise. From the start of 2016 to Q1 2018, ICOs raised over $9 billion, and the numbers continue to grow every year.
However, not each ICO performs equally a good, and only around 10% of them have managed to raise over $50 million per ICO. Around 70% of them raised amounts between $10 million and $50 million, while the rest got only $10 million or less. The most successful ones were HDAC, with $258 million raised, followed by Fileecoin with $257 million, Tezos with $232 million, and Votes, which had $224 million.
Obviously, the ICO market is growing and developing as quickly as the rest of the crypto/blockchain world. By studying their methods, as well as what they rely on, researchers were able to determine the main factors that are influencing the success of ICOs.
The four factors influencing ICO success
1) Popularity of ICO website
The first, and likely the most significant factor, is the popularity of the ICO’s website. Like any website, these ones gain popularity as a result of the projects’ marketing activities. The researchers have studied Alexa Rank of each individual ICO they managed to get data off, and have determined that this is among the top factors of influence. The more traffic the website receives, the bigger its rank when compared to other sites.
So, the closer the website is to the #1, the more popular it is. As a consequence, the more popular websites have raised much more money than those that are positioned lower on the list. For example, if the ICO has Alexa rank anywhere in between of 100k and 10k, it will likely raise more than those sites with the rank of 1M.
2) Activity on Github
Most experienced investors have been known to pay close attention to what is happening on Github in order to determine which projects have potential and which do not. There are many ICOs that try to increase the quantity of their code by storing whitepapers, user agreements, working documents and alike there. However, Github is the place where the worthiness of the code is truly determined. In the end, the more repository stars a certain ICO receives, the more money they are likely to get.
3) Token distribution percentage
Now it is time to talk about percentage. According to researchers, around 95% of ICOs usually distribute anywhere between 43%-79% of their tokens through the initial coin offering. If the percentage of distributed tokens is increased, that doesn’t mean that the ICO will collect more funds. Strong projects that are more confident in their quality, and sure of their success usually do not distribute more than it is necessary. Anything else than that might make a project seem desperate, which is generally a bad thing.
4) The community
It would seem that everything always comes down to the community, which is not surprising, considering that a coin cannot live without its supporters. After researching communities of various ICOs, analysts found that not all of them are equally significant. Activity on Reddit and Telegram has shown to be more important than talking about ICOs on Facebook or Twitter. Platforms like these simply aren’t as popular in the crypto world as Reddit and Telegram. Additionally, many consider Twitter an unreliable place since it is easy to cheat on this platform. In the end, the success of an ICO might simply depend on how much of its community use Telegram as a method of crypto-related communication.
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Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and/or its affiliates, employees, writers, and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency and read our full disclaimer.
Image courtesy of Chris Bevan via Flickr
Should Crypto Projects Devote Resources to Community Growth and Marketing?
2020 has been an incredible year for crypto as investors have generated windfall profits and crypto projects have seen their businesses gain the spotlight they’ve been looking for. While Bitcoin has received most of the attention after major institutional investors announced they were accumulating the increasingly scarce asset, many altcoins have also seen their fair share of glory. When looking at all the big winners of the past year, the first project that probably comes to mind is Chainlink, having appreciated by more than 550% YTD and now valued at over $4.5 billion. But, the actual biggest winner of the year is HEX with a YTD return of over 5,000%.
I mention both of the above projects as they have each taken slightly different paths to achieve greatness. Chainlink has devoted resources toward building a fundamentally sound business with many strategic partnerships while HEX has spent vast sums of money on marketing and promotion. Both approaches are valid, but one thing is certain, it is absolutely imperative for crypto projects to let the crypto community know what makes them special. Of course, one of the reasons that makes crypto so valuable is the powerful blockchain technology that most projects are utilizing.
Cryptocurrency vs. Blockchain Technology
It’s important to make a distinction between blockchain technology and cryptocurrency. Although they are often used interchangeably, they are different. Blockchain technology and crypto were both created after the 2008 financial crisis, but cryptocurrency…
XENO starts VIP NFT trading service and collaborates with contemporary artist Hiro Yamagata
Hong Kong, Hong Kong, 24th December, 2020, // ChainWire //
The XENO NFT Hub (https://xno.live) will provide a crypto-powered digital items and collectables trading platform allowing users to create, buy, and sell NFTs. Additionally it will support auction based listings, governance and voting mechanisms, trade history tracking, user rating and other advanced features.
As a first step towards its fully comprehensive service, XENO NFT Hub launched a recent VIP service to select users and early adopters in December 2020 with plans for a full Public Beta to open in June 2021.
“NFTs are extremely flexible in their usage, from digital event tickets to artwork, and while NFTs have a very wide spectrum of uses and categories XENO will initially focus its partnership efforts and its own item curation on three primary areas: gaming, sports & entertainment, and collectibles.”, said XENO NFT Hub president Anthony Di Franco.
He also added “This does not mean we will prohibit other types of NFTs from our ecosystem However, it simply means that XENO’s efforts as a company will be targeted into these verticals initially as a cohesive business approach.”
Development and Procurement Lead, Gabby Dizon explained, “Despite our initial focus, we found ourselves with a unique opportunity to host some of the works of Mr. Hiro Yamagata. We are collaborating with Japanese artist Hiro Yamagata to enshrine some of his artwork into NFTs.”
Mr. Yamagata has been…
My Crypto Heroes Announces Issuance of MCH Governance Token
Tokyo, Japan, 24th November, 2020, // ChainWire //
My Crypto Heroes is happy to announce the issuance of MCH Coin as an incentive to players in the My Crypto Heroes ecosystem, aiming to allow them to craft a “User-oriented world”. The MCH coin is available on Uniswap with a newly created pool with ETH.
My Crypto Heroes is a blockchain-based game for PC and Mobile. It allows users to collect historic heroes and raise them for battle in a Crypto World. Officially released on November 30th, 2018, MCH has recorded the most transactions and daily active users than any other blockchain game in the world.
What is MCH Coin?
MCH Coin is being issued as an ERC-20 Standard Governance Token. The issuance began on November 9th, 2020, with 50 million tokens issued.
Of the funds issued, 40% are allocated to a pay for on-going development and as rewards for advisors and early investors. 10% are allocated to marketing and the growth of the ecosystem, and 50% are allocated to the community. The Distribution Ratio of the MCH Coin is subject to change via a governance decision.
The MCH coin will be used as a voting right as part of the ecosystem’s governance, with 1 coin being 1 vote. It will also be used for in-game utilities and payments. Additional information can be found here:
During December 2020 the first governance…