Crypto Investment is one of the most significant storms that hit investment market in 2017. Blockchain startups have raised more than three times of capital from crypto investments say ICO (Initial Coin Offering), comparing to traditional venture capitals since the year 2017.
Crypto Investments and Venture Capitals
Three times of investments than Venture Capitals confirm that crowd sale of crypto investment model is an improved one. In these crypto investments, both the investors and token founders are in win position. Investors see there is instant liquidity in it, as they can move freely in and out of their investments, but whereas in VC, the investor’s capitals are typically locked up to 5 - 10 years with an expectation for a massive payday.
Regulations in Crypto Investments
In 2017, we saw China and Korea temporarily ban ICOs, and the SEC publicly stated that most ICOs are subject to US Securities laws and failure to comply will result in legal action. More and more, governments will take a stance on ICOs in 2018. Increased pushback from regulatory agencies may lead to a temporary slow down in the ICO craze but will ultimately build a stronger foundation for a larger, more mature, and legally compliant token sale environment. Investors need to be more selective with crypto investments in 2018. If you’re not getting in during the presale, you’ve already lost.
Growth rate of the Industry
Over the past fourteen months, blockchain and related startups have raised nearly $1.3 billion in traditional venture capital rounds worldwide. However, ICOs Crunchbase has captured, almost $4.5 billion raised through ICOs. The chart below shows how that population of rounds breaks down between traditional VC and initial coin offerings.