This is the final monthly ICO analysis for 2017, provided by Algalon Capital analytical department. You can take a look at our previous analysis for November, October and September 2017 as well. The report covers 160 ICO’s completed in December 2017; pre-ICO’s are not included.
These terms are the key metrics in our report:
- Soft cap is the minimum amount required by a project.
- Target is the funding goal as stated by a project’s team.
- If a target is not stated, then we use hard cap, which is the maximum amount a project is hoping to achieve, or a technical limit of a crowdsale.
What is the Success Criteria?
An ICO is considered to be a success if all these conditions are met:
- Soft cap is reached.
- More than 50% of the target or hard cap is collected.
An ICO is considered to be a failure if at least one of these conditions is met:
- Soft cap is not reached.
- Less than 50% of the target or hard cap collected.
- No information on the project status and funds raised is available, the official website has been deleted and or the official Bitcointalk thread is cleared.
If soft cap, target and hard cap are not stated, our experts will analyze the project and make sure that the funds raised are sufficient to implement the business. Thus, if a business has collected the necessary funds to implement their roadmap, we deem it a success. If not, it is considered unsuccessful.
According to specified criteria, 70% of ICO’s completed in December 2017 failed. About half of them do not provide any information about ICO results, don’t have any updates since finish or even deleted social media accounts.
41% of all failed ICO collected less than 1 million USD. That does not make the project a scam, but it does raise concerns.
What about the market size?
Let’s see what is going on in the market regarding funds raised.
|Total funds raised by all projects||$1599M|
|Total funds raised by successful projects||$1192M|
|Total funds raised by unsuccessful projects||$407M|
|Median funds raised by all projects||$7.1M|
|Median funds raised by successful projects||$19M|
|Median funds raised byunsuccessful projects all projects||$2M|
This month we can see a real breakthrough in the amount of funds collected. In December 2017 $1599.2M was collected, which is almost twice as much as November’s $949M.
We should consider separately the top 10 projects that have collected more than 40 million each with total amount over $600M. The most significant explosion is Sirin Labs, with it’s blockchain smartphone and ecosystem, collected $157.9M. It was one of those rare ICO without hard cap, in this case limited only by a period of 14 days.
Regarding caps, we admit that a very small number of projects (over 5% this month) do not set hard cap for their ICOs. Most often they don’t provide information about funds collected and eventually considered to be a scam.
More than a half of all ICOs set soft caps. Only 8% of all projects don’t meet their soft caps. Only 12% of ICOs specify their target. However, many projects breakdown their roadmaps in relation to how they will spend the funds that they raise. This instills trust in their investors but does not pertain to our analysis metrics.
We should mention the increasing number of projects which do not provide ICO results hiding by some vague definitions like: “we successfully raised enough to start the project”. In December 28% of all ICOs did not report amounts of capital raised compared to 19% in November. Mostly their results are pretty low to affect the overall figures.
Median funds collected by all projects, including successful and unsuccessful ones, was $7.1M in December 2017 vs. $4M in November 2017, which is an increase of 78%.
We should always take into account that small and failed projects heavily influence this figure, a number of which fluctuates from month to month. That’s why we also estimate median funds collected by successful and unsuccessful projects separately.
Median funds collected by successful projects in December was $19M against $14.6M and $16M in November and October respectively. The median for unsuccessful projects was 2 / 1.4 / 1.4 million USD for last three months. So, we can see the positive trend in median figures of capital raised by both successful and unsuccessful ICO’s. Projects start to collect more money on average.
The following pie graphs categorize the projects by total earnings.
We indicted the trend of more realistic caps being set. Projects start raising money on specific purposes with a clear road maps. There are around 30 projects hard capped under 10 million USD and almost 40% of them are successful.
Have the projects reached their goals?
The following graph analyzes ICO’s with a verified target or hard cap figure.
More than a half of all projects collect either under 10% or above 90% of their target/hard cap.
- December raised the highest amount of ICO funds out of any month this year. The
total funds raised $1599M, surpassing the previous peak in October by 68%
- Total number of ICO concluded in December was 160, 30% more than last month
- Still a lot of ICOs fail according to our criteria: 70% of all projects. However,
it’s slightly less that we saw last month with 72% of all projects failing
- The median funds collected by successful projects in December was $19M, and $2M
for unsuccessful. This continues the positive trend
- The overall median for all projects is $7.1M, which increased by 78% compared to
$4M in November
- There are around 30 projects hard capped under 10 million USD and almost 40% of
them are successful
- More than a half ICOs raised either under 10% or above 90% of their target/hard
- Only 8% of ICOs did not state hard cap. One of them collected $157.9M
- Only 12% of ICOs stated the target amount
- Only 5% of all projects don’t meet their soft caps
- 28% of ICOs did not report amounts of capital raised compared to 19% in November.
Near the half of such projects claimed that the ICO was “successful”
- Only a few projects admit “failure” status and issuing refund.
2017 has definitely been a record-breaking year for ICOs. ICO way of fundraising surpassed the traditional VC industry and continue to grow rapidly. ICO raised more than 6 billion USD in fiat equivalent during 2017 with around 25% of this amount just in December.
Next year Algalon Capital will continue providing you with the latest trends in ICO market on the monthly basis.
Stay in touch.
Sources: Algalon Capital, project websites, whitepapers, official Bitcointalk threads.