Amidst the rising regulations, Initial Coin Offerings (ICO) have set a quarter record by raising $3.3 billion in the first quarter as per the Global Fintech Report of Q1 2018 by CB Insights. The blockchain companies also recorded an increase in investment.
A record set with over 400 ICOs in the first quarter
According to the Global Fintech Report Q1 2018 released by CB Insights, the global investments in fintech companies have raised $5.4 billion till now in 2018 which is about a 50 percent increase from last year’s $2.8 billion in the same period. Approximately 323 deals have been closed in this year’s first quarter.
However, the point of attention here is the Initial Coin Offerings (ICO) that are not far from the fintech companies, rather they have set their own record in the first quarter by raising $3.3 billion.
In January, 170 ICOs raised $1.6 billion which then slowed down a bit as $1.2 billion was the amount gathered by 121 ICOs in next month while March has registered 113 ICOs with $507 million raised amount.
ICOs have a long way to go in comparison to the mainstream fintech companies no doubt, but still, the nascent industry managed to hold its own. With $3.3 billion raised in the first quarter of 2018, the sector is surely a force to be reckoned with.
ICOs, regulations & increase in blockchain investments
The regulatory crackdown on the ICOs has been a major factor to affect their growth in February and March months. Regulations are simply inevitable that might affect the ICOs negatively but in the long run, they would fuel investors’ interest and trust in this new crowdfunding source.
Countries that strike the right balance of regulation while providing the space for innovation and growth will be able to leverage these ICOs and reap the rewards as well.
Another factor that affects the popularity of ICOs is the market trend. In the last few months, the market has been experiencing a bearish trend that dampened ICOs effect. Now, with the bullish momentum driving the cryptocurrency market, it is expected that the ICOs will be seeing a further rise in numbers.
The first quarter also registered an increase in the investment in blockchain companies at $163 million in comparison to last year’s first quarter deal raising $111 million. About $700 million was raised in 2017 by blockchain companies which is slightly more than March month’s ICO funds.
ICOs are clearly a big deal that is growing over the time even after coming under the constant scrutiny of regulators around the world. Entrepreneurs and investors alike are utilizing this crowdfunding avenue. However, the rising numbers and interest in this sector call for an appropriate and innovative regulatory approach that promotes this sector while minimizing the risks of scams and frauds.
Do you think the upcoming quarter will be a much bigger success than the previous one for ICOs? Share your thoughts with us!