Feature |

2017 Token Sales in Review: Part I

It is passe to say 2017 was a wild year for token sales / ICOs. Over 500 projects raised $6.5 billion during a time when overall crypto markets grew in size, awareness, and depth.

It is unoriginal to say 2017 was a wild year for ICOs. However, it is largely unconventional to say ICOs were a significant and mostly positive trend in the development of the blockchain and cryptocurrency sectors. It is rather tedious to read yet another mainstream press article mocking ICOs and their participants, all too often sandwiched between articles on the further declines of ‘IPO of the year’ SNAP Inc., and another multimillion dollar fine paid by a major bank for defrauding clients or manipulating markets, with no hint of irony or editorial self-awareness. Undoubtedly, there are most certainly extreme events that exhibit the worst of the industry that should not be whitewashed or glossed over: scam projects, flagrant disregard of publicly distributed regulatory guidelines, misrepresentations of technology and projects and companies, and wild speculation with no deep understanding of the underlying technology. Nonetheless, this wasn’t the whole story of token sales, and beneath this surface that many delight in pointing out, an enormous amount of significant activity marked 2017, much of it promising meaningful long-term impacts. In many ways, the “ICO Industry” is a lens through which to understand broader developments in the blockchain and crypto-asset industry, and data from 2017 offers plenty of insight.

Given the range of token sale activity during 2017, and the variety of trends that both contributed to and emerged from the token sale space and the broader blockchain and cryptocurrency communities, we will be presenting our ‘2017 in Review’ thoughts and commentary in several pieces.

Below is a simple overview of the growth of the industry, with a few links to some previously published pieces that help illustrate some of these ideas. It concludes with a brief consideration of how those numbers fell into the different sectors that shape the overall blockchain industry.

Token sale activity grew remarkably throughout 2017, leading to a total of 525 sales that completed sales raising more than $25,000. In total, these sales raised over $6.5 billion. This was a marked increase relative to token sale history, which began with Mastercoin’s ICO that raised under $1 million. 2017’s average raised of $13 million and median raise amount of $5.0 million suggests the numbers for overall raise figures are heavily skewed by a small number of large raises, a trend that persisted throughout the year. Nevertheless, given that 2016’s token sales raised a collective $100 million–an amount surpassed by 15 individual sales in 2017–the scale of growth is rather clear.

Looking across the landscape of individual sales for 2017 also provides a powerful perspective on the range of activity throughout 2017. While a handful of the largest raises featuring in the upper half of the below chart garnered an enormous amount of media attention during 2017, a large number of other projects also raised significant capital.

The project raising funds varied remarkably in their application of blockchain technology, product or platform, and underlying business model. Smith + Crown categorizes token sale projects according to the economic sector they are trying to disrupt. Below is the same data disaggregated into different sectors.

Part II will look behind the most prominent trends to consider some more subtle themes that marked a breakout year for token sale activity.

Note on methods: Includes all sales that raised over $25,000 and did not return funds raised to sale participants. Amounts raised are valued according to average daily exchange rates on the date the sale closed. EOS’s ongoing sale is valued according to the total raised during each auction period and grouped into monthly amounts. Data taken from eosscan.io and confirmed in the smart contract. Sale rounds for the same project that are separated by more than 30 days are treated as separate sale events. Some data may be missing or subject to future revision.