BitMEX Research: ICOs Have Sold 'Almost All' Ether (ETH) They Raised, Also 'Sitting On Unrealized Gains'

BitMEX Research: ICOs Have Sold 'Almost All' Ether (ETH) They Raised, Also 'Sitting On Unrealized Gains'

Omar Faridi
  • EOS raised a record $4 billion during its ICO, but has now sold all its Ether (ETH) holdings, according to BitMEX/TokenAnalyst's research.
  • The 222 ICO projects analyzed by the researchers indicate that most of the ETH raised has been sold at well above the token's currently low market price.

BitMEX Research, the research arm of cryptocurrency derivatives trading platform BitMEX, recently published its findings on “Ethereum Holdings In the Initial Coin Offerings (ICOs) Treasury Accounts.” The research paper’s abstract notes that BitMEX worked with UK-based crypto asset intelligence firm, TokenAnalyst, to determine the amount of Ether (ETH) raised and the “gains and losses” incurred by ICO startups due to Ether’s fluctuating prices.

The researcher’s findings indicate: 

Rather than suffering because of the fall in value in ETH, at the macro level, the projects appear to have already sold almost as much ETH as they raised (in USD terms).

Arthur Hayes

$34 Million In "Realized Losses"

After performing a macro analysis of the ETH raised by 222 different ICOs, the results revealed that the heavily funded EOS project, which raised a record $4 billion during its ICO, has now sold all 7,211,776 ETH it accumulated during its token sale. BitMEX’s paper estimates that Block.one (company that developed EOS) sold the massive amount of ETH at an average (combined) value of $3.82 billion. Notably, if Block.one had sold the tokens at the present market rate, it would have only received $1.65 billion.

TokenAnalyst and BitMEX’s research division also found that out of the total 7,972,003 ETH raised by the 222 ICOs analyzed (at an average market value of $1.639 billion), 4,113,345 ETH or 51.6% had “been sold/or transferred out” at a total estimated $1.56 billion.

In total, the amount of Ether tokens sold/or transferred out stands at 11,325,121 (for the 222 ICOs) - and they netted $5.452 billion. BitMEX’s researchers estimate EOS’s realized project gains at $68 million and $692 million by the other ICO projects.

Significantly, $34 million in realized losses has been incurred by the 222 ICO projects BitMEX and TokenAnalyst examined. Meanwhile, the present unrealized ETH gains (zero for EOS as they reportedly sold all their ETH) for all the blockchain projects analyzed is $93 million.

The total net gains from selling or allocating out of Ether stand at approximately $819 million for all projects assessed. In conclusion, the research has determined: 

Of the ETH still held by the projects, even at the current c$230 price, projects are still sitting on unrealised gains, rather than losses.

Arthur Hayes

Inexperienced VCs Can't Handle The "Vagaries" Of The Market

As CryptoGlobe reported in mid-August, BitMEX CEO Arthur Hayes had referred to Ether as a “shitcoin.” Hayes had accurately predicted that the ETH price would drop well below the $300 mark, however, his prediction that Ethereum’s native token will dip below $100 has yet to happen.

Commenting on the mostly speculative venture capital investors who’d been lured into buying ETH, he said:

The VC investor who has never suffered the vagaries of the market is as green as the noob who thinks he or she can go from 1 to 100 Bitcoin in a few trading days. They don’t have the mental strength to cut positions to limit further losses, or backup the truck and buy opportune dips even though they are down.

Arthur Hayes