2017 was a year of massive activity for ICO. It wouldn’t be wrong to say that despite that, that the popular crypto based fundraising scheme was in the eye of the storm as well and kept many wondering, “What next?” as the year came to a close.
What we may not know is that 235 ICOs were launched in 2017 pulling in more than $3.7 billion in funds for startups and projects according to Coinschedule. The year saw many new startups take advantage of the initial coin offering, which though has been in existence since 2013 actually came became mainstream in 2017.
ICO was a source of concern to government regulators and traditional venture capitalist and even banks who either saw it as an unregulated and potentially disruptive activity or as a competition. This resulted in a ban in some countries while others have regulators hard at work to streamline and roll out sets of rules to guide or govern ICOs.
In view of the foregoing, what are the expectations for the ICO space in 2018?
We sampled the opinion of the ICO and blockchain community to know what to expect in 2018 and here are some of the expectations.
No one was left in doubt that there was a need to have a form of regulation for ICO which was largely a venture that everyone who could come up with an idea could get involved in, even if the idea is not a plausible or outright joke. Those governments in China, South Korea and a couple of other countries banned ICO was a direct consequence of this. This trend is likely going to change as regulators start setting forth rules that guide ICOs in the new year.
Russia, for instance, is expected to release the guidelines for ICOs in the country by Q2 of 2018. Other countries are likely going to follow suit. It is worthy of note however that some countries already have modalities with which ICOs are conducted in their domains. Countries such as Japan. Switzerland and Hong Kong have shown that ICOs can be regulated without limiting the potentials it has as a source of funds for nascent businesses.
ICOs in Hong Kong are known to have an internal regulatory framework with which crowdsales are regulated. It is obvious that 2018 will see countries model regulations after what some these countries have done to see a more organized ICO space.
2018 is going to see more activity in the ICO space among big tech corporations such as Microsoft, as well as the flow of funds from financial institutions such as banks and financial markets companies such we saw with Chicago Boards Option Exchange (CBOE) and the Chicago Mercantile Exchange CME in the Q4 of 2017. This will be incentivized by the regulatory framework of governments on ICOs and digital currencies.
Corporate investors will likely take center stage this year as we see more ICOs battle with regulation capped fundraising. Last year, ICO targets was a function of imagination and the community witnesses millions of dollars raised from ICOs. There were debates if the companies needed all those funds raised as there were no known metrics for their evaluations, neither was there any regulatory framework on the ground to ensure that their projections were accurate.
Some companies were just interested in beating records not that they needed as much as they raised. This year will see regulators set limits on ICO amount that different companies can raise. The usual presale that targets corporate investors will see more activities even from traditional venture capitalists.
Established companies with products have been known to conduct more successful ICOs. This year, we are going to see more of product-related projects and not just concepts and service-based ICOs. This is because companies that are already in operation will start looking at ways to take advantage of blockchain technology to improve their products as well as raise funds through ICOs for new products.
Imagination based limitations will be surmounted as companies see their competitors or businesses in related fields take advantage of the blockchain. This will create more practical blockchain applications with the realization that the limitations are not with the technology, but with conceptualization and integration. This will create a more confident business-developer community.