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.

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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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