One Nation, Under Doge. A Look at Token Sales Thus far in 2018.
Amidst all the doom and gloom of the recent cryptocurrency bear market, it’s hard to not read the above chart as a giant middle finger…there is a feeling that we’ve all been left holding the bag, or at least, that’s what some would want you to believe…there is hope, at least that’s what I’m telling myself:
With the roller coaster of emotion surrounding the movement in cryptocurrencies, I wanted to write this article to get a relatively objective read on the market, and to find out one simple thing: have we all wasted our time here, or are deals getting done? Is this thing still alive?
While graphically depressing on a relative basis, on an absolute basis it seems like the answer to that question is that there is resilience in the cryptocurrency markets. While we’re at a relative low point in the year, we’re still talking about $1.3B being raised by startups in a month. That’s insanity.
I understand this next data point isn’t apples-to-apples with the above table, but just to give you an idea, VC funding hovers around $300M per month, so, even at its lowest point, token sale funding is (very roughly) >4.0x that of venture capital funding:
Even at the very bottom, if we start digging in to how individual projects, and ask how they’re going, it’s hard to not say: “not too shabby!” (especially with all else considered). Check out a high level view of token sales from a popular schedule site.
A lot of projects that are raising $20M+ are 40%+ done, and mostly 70%+. These are hard statistics to ignore:
This is not a space for the faint of heart, but it’s especially not a space to give up on. There are many quality projects still getting funded, and people are putting themselves out there to get involved. The token sale market is far from dead, it’s just vulnerable…to the broader cryptocurrency market, which is a fickle beast. But in the end, when we’re talking about 4x the VC market for a vehicle that’s roughly one year old, we must be doing something right…right?!
Over time, backers of these projects will get increasingly sophisticated, and those that aren’t will lose the funds to participate. Not to go all neoclassical economist here, but the market will ensure the survival of the fittest. That goes for both project backers and projects.
So my answer to myself, and to you — the reader, is to keep calm and carry on.
Blockchain, and the affiliated token sales, are here to stay. Take advantage of market emotions and get smart. We are nearing, if not currently at, the point of maximum financial opportunity.
This, my friends, is the state of our nation.