The success of ICOs means they would be under more scrutiny. Since ICOs have been used to raise funds for capitalisation, regulators are now keen on forcing proponents to register their offering as securities in order to protect its stakeholders.
The ICO landscape has had a notable maturity since its euphoric phase in 2017 and calculated era in 2018. With these changes, the token sale market almost looked like traditional investment markets with its unique characteristics rather than just a hyped-up investment market.
The year 2019 introduced global trends in ICO never before seen. This includes:
More Institutional Money Coming In
Whilst the many whales joined the ICO market even before, this 2019 will see an influx of more institutional money, particularly that many powerhouses like NASDAQ and NYSE are already in the works in creating the infrastructure institutional investors need to go into the market. As more institutional money comes in the ICO market, the token sale will increase its credibility and allow proponents to raise more capital through high-quality ICOs.
Telegram, the biggest ICO of 2018, received some notable investments from well-known venture capital firms like Benchmark and Sequoia and more are expected to invest more institutional money this year.
Initial Exchange Offerings (IEOs)
IEOs made its debut in 2018, but it is likely to get bigger this 2019. IEOs are similar to ICOs but it mostly delegates token sale into a trustworthy exchange rather than using the project to run the token sale all on their own. These exchanges are expected to attract more investors as they are AML compliant, strict KYC methods, and other well-accepted compliance processes – a great way to deter scam ICOs.
The IEOs would also give investors a simplified method of investment since they do not have to set up several new accounts from a number of token issuers. This year will see more of these exchanges as they already have an established infrastructure. New ICOs can even take advantage of this to successfully launch their tokens. Investors would also love the fact that the exchanges have a list of the token after a sale, which will prove the liquidity and provide trading opportunities.
Increase in Global Market Regulations
Note that the influx of institutional money is closely related to global regulations in place for ICOs. The existence of clear policies on ICOs will bring in more investments into the market. Several countries like Thailand and Japan are already in the works of laying the groundwork in creating a more progressive crypto market. Other countries like France and the US are also carefully threading the pathway in which they would take ICOs and cryptocurrencies.
In general, ICO markets will thrive in countries where there are clear regulations for cryptocurrencies. As more global markets carefully consider setting regulations and policies for ICO markets, investors can expect more compliant and regulated token sales this year.
Birth of ICO Management Platforms
The success of one industry often gives birth to a new industry. The same can be said about the ICO market. A robust ICO market gave birth to the new industry of professional ICO management platforms.
Before, many of the ICO projects heavily depended on traditional software when it comes to managing their token sales. However, ICOs are unique in their own way and have parameters and metrics that legacy tools and spreadsheets have difficulty covering.
To launch a successful ICO, token issuers must do it in a platform that is specific for them. This is the reason why professional management platforms like T-Axis exists. Smart CRMs for token sales help token issuers to simplify ICO management before, during, and after the sale process. They are likely to increase this year along with analytics tools to streamline token sale.
Increase in Use of Security Token Offerings (STOs)
Security Token Offerings (STOs) are creating a buzz in the market and stakeholders believe it will see much success this year. Many crypto experts believe STOs will bridge the gap between traditional markets like equities and the token sale market. Ideally, companies can issues STOs as a representative of their shares, mutual fund units, or physical asset ownership.
One of the hurdles ICO issuers must resolve is to identify whether their tokens are securities. STOs, however, answers it by tokenising securities. Many believe that regulators will take a look at STOs positively, opening more opportunities for investors and token issuers. The existence of STOs will also give birth to platform wars to become the next successful token in the STO market.
Startups Looking for Ethereum Alternatives
Since there are more people looking to get into the blockchain technology. Ethereum must be able to vastly process more transactions faster or else more startups will look for other options. Whilst Ethereum will remain a big winner with regard to community and developer tools, other platforms such as Stellar, Plasma and OmiseGO are getting good reviews as well.
Startups want to work on something that they can benefit from at a faster rate so Ethereum must resolve their backlogs immediately unless they want to lose all these young companies to other platforms that can provide them with better services that they can. With blockchain getting worldwide recognition and regulation, more startups will use ICOs to look for capitalisation.
Traditional Tech Companies Selling Tokens
Cryptocurrencies are gaining ground and more credibility as more traditionally established tech companies join the token industry. Facebook now has Libra and Telegram is reportedly seeking more funding through token sales. Most tech companies are out to make sure they are not missing out on something but they are most probably more careful about it.
In conclusion, these latest ICO market gives you an idea about where blockchain technology and cryptocurrency is headed in the near future. It will be more popular with a more global reach and would be more regulated. This, in turn, will attract more investors from established institutions to put more money and trust in the technology. When this happens, blockchain will gain more ground, further improve and attract more investors.