We have heard a lot about ICO scams lately, but a new research on ICO from Boston College Carroll School of Management says that – investors are in a prominently profitable state.
As per research paper, for around 4,003 ICO’s under investigation generated capital of total $12 billion. Furthermore, for an average 16 days of holding period, the token value raised by 179% between first-day opening price and getting listed in cryptocurrency exchange.
The study highlights the fact that even if tokens are not listed in exchange within 60 days, the return on investment for the investor was around 82% in USD. This certainly is an enticing figure for an investor to get into crowdfunding business.
Additionally, if investors waited until their tokens getting listed in exchange site, the ROI(return on investment) would still be 67% for the first 30 days of trading.
The interesting fact here is that more the investors waited to get listing of their tokens more the profits. For instance 140% for a time period of 90 days, 430% for 180 days and even up to 1880% over 360 days. However, very few ICO tokens have been trading throughout the year and hence lesser data points for such long duration.
As per spokesperson from the research team,
“Our paper shows that ICOs investors are compensated handsomely for investing in new unproven platforms through unregulated offerings. It suggests that scams, while plentiful in number, are not as important in terms of stolen capital because investors are shrewd enough to spot (and underfund) them”
However when questioned about future of ICO industry,
“Well, that’s a tricky question, because nothing guarantees that the market will continue to allocate capital as proficiently as it has so far. Retrospectively, we see that even though there have been many underperformers (ICOs that list or trade below their issuance price), on average the returns to the industry have been largely positive”
What do you think of this research? Will the ICO industry continue to profit the investor or bring in new change? Let us know your thoughts in below comments.