Initial coin offerings (ICO) have only managed to raise $40 million so far this year, according to BitMEX’s research division.

Researchers at the Bitcoin Mercantile Exchange, or BitMEX, a Seychelles-registered and Hong Kong-operated cryptocurrency derivatives exchange, published a blog post on May 13th, 2019 in which they noted that the ICO market is down 97% since May 2018.

Companies “Changing The ‘C’ In ICO To An ‘E’”

According to BitMEX’s research arm, several blockchain projects have “changed the ‘C’ in ICO to an ‘E’, perhaps in an attempt to assist with raising capital.” Indeed, there have been quite a few initial exchange offerings (IEOs) which have been launched this year.

An IEO is also a type of crowdfunding campaign, however the fundraising process is usually facilitated by the management at a centralized cryptoasset exchange.

As noted in BitMEX’s blog, the Dfinity and Telegram ICOs (held during 2018) raised $1.7 billion and $195 million, respectively. However, the native tokens for both projects have not been listed.

Notably, the EOS ICO, which was launched by the management at, a Cayman Islands-registered open-source software publisher, generated a record $4.2 billion. However, the EOS token had been trading at -4% of its issuance price (at the time BitMEX released its report).

Projects Shutting Down Due To Regulatory Pressure

Due to regulatory restrictions, the highly-anticipated Basis stablecoin project was forced to shut down and the funds were returned to investors, BitMEX confirmed. Meanwhile, some seemingly promising projects such as PumaPay and UnikoinGold are currently trading at -93% and -88% of their issuance (at time of ICO) price, BitMEX’s researchers noted.

Going on to compare the funds raised via IEOs with ICOs, the data compiled by BitMEX revealed that the BitTorrent (BTT) token sale, held on Binance on March 2nd, 2019, managed to raise $7.5 million and the current “return vs IEO price” stands at 433%. Other IEOs also launched on Binance such as Fetch.AI and Celer are not doing as well, as their “return vs first exchange trade price” stands at -55% and -29.4%, respectively.

Most ICO Investors “Earned Strong Positive Returns”

Commenting on the relatively large number of IEOs launched in recent months, BitMEX’s research team acknowledged that the new type of crowdfunding model has been “somewhat successful.” The researchers confirmed that “smaller exchange platforms” have tried to introduce IEO models which are similar to those used by major exchanges including Binance, Huobi, Bittrex, and OKEx.

Most IEO investors have “earned strong positive returns based on the IEO [issuance] price,” BitMEX revealed. However, the researchers have found that the return on investment (ROI) has been “typically poor” after the tokens began trading actively on various exchanges.

According to BitMEX’s estimates,$38.9 million have been raised so far this year through IEOs (as of April 25th, 2019). Notably, Binance, the world’s largest exchange in terms of trading volume, has been “the most prolific IEO platform by a considerable margin,” BitMEX’s researchers concluded.

Some other key observations made by BitMEX’s research team are as follows:

  • “On average, only 4.4% of the total token supply [has been] made available in [IEO token] sales”,
  • “There are opportunities for project teams to make considerable profits from selling coins they granted to themselves,”
  • “The 2019 IEOs were priced at a level which implies a total market capitalization of $907.7 million, based on the disclosed total token supply.”