Free to Flourish – II

Posted by: on Mar 9, 2018 | No Comments


Regulators are baffled. Governments have no idea how to tame this one. And, the market is flourishing. I’m talking about ICOs, or initial coin offering, a novel way for businesses to raise funds for their innovative ideas. This is what happens when there’s no central authority to meddle in business affairs.

Wondering what an ICO is and how it works? Read my previous article.

No Restrictions Allowed

ICO investors are spread across the world. There are no boarders when such fundraising is concerned. There’s no paperwork involved. And, there’s no central authority to appease. You are free to flourish, as long as you have business acumen, ambition and drive needed to see it through.

Offering such advantages, ICOs could revolutionize not just currency but the entire financial system as we see it today.

A Look at the Numbers to Judge the Potential

In 2016, around 43 startups raised a total of slightly more $95 million via initial coin offering. This seems amazing enough, but the record was broken in 2017, with more than 200 startups raising a total of around $3.9 billion. So far in 2018, more than 70 companies have raised funds through token sales, totaling more than $2.8 billion in seed capital.

Here’s a look at the diverse nature of companies that raised funds last year:

  • Infrastructure – around 26%
  • Finance – around 15%
  • Trading & Investing – about 10%
  • Communications – a little over 8%
  • Payments – around 7.5%
  • Data Storage – around 7.5%
  • Drugs & Healthcare – around 6%
  • Gaming & Virtual Reality – close to 3.5%
  • Gambling & Betting – almost 3%
  • Commerce & Advertising – close to 2%
  • Data Analytics – about 1.5%
  • Machine Learning & Artificial Intelligence – close to 1.5%
  • Social Network – almost 1.5%
  • Privacy & Security – about 1%
  • Art & Music – around 1%
  • Identity & Reputation – close to 1%
  • Legal – almost 1%
  • Energy & Utilities – around 0.7%

And, now the best part. Here’s a look into the returns for investors by some of the top ICOs.

The average return on the S&P is 10%. During last year, token investors recorded ROIs (returns on investment) as high as 50,000%. Has any other market in the history of any asset recorded such fabulous returns? It is unparalleled and thus far unheard of.

Naysayers will tell you about the risks being high. Yes, they are. Can you imagine such returns with little or no risk?

What you must bear in mind, however, is that the market is still maturing. It’s evolving at a pace unprecedented by any other market. So, there are bound to be a certain degree of uncertainty and unpredictability. So far, the ICO market has surpassed even the most optimistic projections. And, the signs are good. The amount of money entering the space is trending upwards and the barriers to entry are easing.

Free to Flourish

So, why is the ICO market flourishing? Why has this become such a huge force in such a short span of time? The reasons are clear – it is decentralized. It is free of any central authority trying to exert its importance by laying down a series of complex regulations. Bureaucracy and red tape will always hinder business growth. The sooner governments learn this, the easier it would be to do business and the more economic growth.

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