ICOs were undoubtedly a hot trend back in 2017 and 2018 during the parabolic bull market and the subsequent selloff. Ever since then, their prominence has stalled and a recent report shows why that might be. Remarkably, 640 out of 2,000 reviewed ICOs haven’t added or written a single line of code in 2019, and in some cases, the lack of activity is even more alarming.
ICO Projects Lie Dormant
A report from Coincodecap which looked at over 2,000 cryptocurrencies revealed that 32% of them hadn’t written or added a single line of code in 2019. Despite this inactivity, their current combined market cap is more than $415 million.
Most of these inactive projects were launched in 2018, with a few exceptions. The largest inactive project is called Proton, and it saw its last days of coding exactly a year ago. Still, it has the largest market capitalization among inactive cryptocurrencies, $85 million. BQT follows with $45 million, and Sprouts comes in at $32 million – both without any code commits since 2018.
Exchanges with the Most Listings
The report also revealed which exchanges have listed the largest number of dormant projects. 12 exchanges were found to have listed more than 10 such ICOs. YoBit listed 62, followed by CoinExchange (39) and Crex24 (30).
It’s worth pointing out that some of those exchanges charge high fees when listing various coins, as they don’t generate sufficient revenue from trading, according to the report.
Regulations and Improvements
The document proposed the introduction of “a self-regulatory market to perform its fiduciary duty [that] will not expose customers to these harmful assets.”
As PlowBitcoin reported, Vitalik Buterin offered a possible solution for the scammy nature of some ICOs at a recent Ethereum summit:
“This is a spin on the ICO idea that I had one and a half years ago. So the idea is, instead of projects having ICOs where people will just send them the money, and they, well, go away, you have a scheme where people put their tokens into a smart contract. […] The developers don’t just have access to the tokens, they can’t take them. Instead what happens is the money gets put in a compound, or some other interesting thing […] and then the interest goes to the developers.”
The initiative which Buterin dubbed “Public Interest Projects” makes use of one of the hottest trends of 2019, Decentralized Finance (DeFi).