2016: The Year Blockchain ICOs Disrupted Venture Capital

Matt Chwierut is research director at Smith + Crown, a research and data group focused on crypto-finance and blockchain technology. There, he works alongside Sid Kalla, CFA, a researcher and journalist focusing on cryptocurrencies.

In this CoinDesk 2016 in Review special feature, Chwierut and Kalla recap the year in ‘initial cryptocurrency offerings’ – a new form of fundraising that is gaining popularity in the blockchain industry.



You may have missed it in 2016, but initial coin offerings, or ICOs, have become the dominant way to fund new cryptocurrency projects.

In an ICO, a project sells part of the total token supply to early adopters in exchange for money with which to progress.

ICOs have two primary benefits: they provide funding to the team to see the project through, and incentivize a community to contribute (who gain if the project succeeds and the tokens are worth more than they bought them for).

Although 2016 witnessed a high number of ICOs, they are not a new phenomenon and some ICOs from earlier than 2015 include well-known projects like ethereum, Factom, Augur, NXT and Mastercoin.

2016 however saw unusually high activity in the ICO space, both in

Read more ... source: CoinDesk

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