ICO death spiral fears may be overdone finds latest research, ETH keeps falling

EthereumResearch from Diar Newsletter says that many top ICOs from last year have deep reserves of funds.

The ICO death spiral may not be all it is spun up to be. The sneaking suspicion, as reported here and elsewhere, that projects that undertook initial coin offerings are selling reserves as ETH falls in value, may be wide of the mark if analysis from Diar Newsletter is right.

Diar’s findings show that many popular tokens have healthy ETH balances.

Note: Smartphone users rotate device to landscape to view full table

Table 1: Popular Tokens Sitting on upward of $½ Billion (source: Diar)

Name ETH Raised ETH USD
DigixDAO 466,648 395,433 75,808,415
Golem 820,000 369,023 70,745,428
Polkadot* 485,331 306,276 58,716,224
Status 299,898 246,419 47,241,053
Aragon 274,990 237,466 45,524,526
Filecoin 566,715 216,906 41,583,115
Tezos 361,122 203,468 39,006,848
Gnosis 250,000 190,367 36,495,316
Iconomi* 114,939 114,939 22,034,956
Kyber 200,000 81,999 15,720,048
Request 100,000 80,000 15,336,800
Airswap 119,511 38,908 7,458,999
district0x 43,000 37,990 7,283,092
TenX 245,832 37,835 7,253,353
Bloom 54,000 33,185 6,361,973
Bancor 396,720 30,698 5,885,125
0x 80,000 30,050 5,760,831
Santiment 45,000 30,006 5,752,401
Basic Att’n Tokn 156,250 26,344 5,050,408
Raiden Network 109,532 24,957 4,784,432
Sirin Labs 205,000 4,290 822,354

The figures show that many top-tier projects that held their token sales before the price run-up took off at the end of last year have deep reserves of funds. That should guarantee funding of development roadmaps.

Market capitalisations less than Treasury

Token ETH Treasury USD Market Cap
Aragon 237,466 45,524,526 21,548,571
SingularDTV 201,131 38,558,754 10,734,428
Gnosis 190,367 36,495,316 32,538,049
FirstBlood 76,921 14,746,463 5,370,291
Monetha 57,190 10,963,813 3,682,337
HEROcoin 39,116 7,498,962 1,101,650
Bloom 33,185 6,361,973 3,962,182
Mysterium 27,522 5,276,271 2,361,780
Atonomi 26,922 5,161,222 3,640,872
Indorse 16,559 3,174,552 1,531,934

 

In the foreword to the report the authors explain:

“Companies that did an ICO before the price boom of 4Q17 are sitting on massive reserves that could potentially fuel development teams for years to come. Last week TenX, a basic wallet that promises a Visa debit card, voluntary disclosed their financial positions revealing that the company is sitting on over $100Mn. Not only is that more than the company originally raised, but it’s more than their whole network is currently valued on secondary markets. And they’re not the only ones.”

ETH is down 3% today at $192 as it continues to shed value. Bitcoin has stabilised at $6,300 for now and overall market cap of crypto has slumped to $193 billion. The overwhelming majority of ICO tokens are ERC-20 compliant or some other variant, meaning they run on the rails provided by Ethereum.

There are plenty of other issues weighing on the ETH price other than  projects selling out. The delay to Casper upgrade looms large and the ongoing problem of Gas prices, forcing sales of ETH to pay for the transaction costs of running dapps.

The ICO death spiral may not be across the board but as the second chart shows.

But there is still selling pressure being brought to bear by market conditions, which leaves open the question of how a continuing bear market might yet push many projects into selling substantial amounts of their ETH stash.

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