BitMEX Report: Almost All IEOs Down 80% or More

Michael LaVere
  • BitMEX report found the majority of Initial Exchange Offerings (IEOs) followed since May have dropped in price.
  • Most of the projects declined 80 percent with only four generating a positive return since launch.

Initial exchange offerings (IEOs), which were heralded as the replacement for initial coin offerings (ICOs) in 2019 have faired abysmally, with the majority losing investors 80% or more. 

According to a new report by the research division of crypto exchange BitMEX, IEOs across the board have seen a significant decline in price since the beginning of the year. An original report in May 2019 detailed twelve projects launched as IEOs and evaluated their performance throughout the year:

Back in May 2019, we covered what was a relatively new phenomenon at the time, Initial Exchange Offerings (IEOs). We cynically indicated that IEOs seemed to be an attempt to convert the “C” in ICOs into a new letter, “E“, in order to avoid the reputation for poor investment returns associated with ICOs.

The BitMEX report found that despite the appreciating value for bitcoin since May 2019, which at one point climbed as high as $13,000, eleven of the twelve projects have significantly declined in value. Only Matic, a Binance IEO, has managed an increase in value, with most of the projects losing more than 80% in value and four projects losing more than 90%. 

Despite IEO buy-in prices normally being lower than the initial trading price on exchanges, only four of the eleven have managed to generate a positive return on investment since launching.

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Crypto Rating Council Evaluates Three New Cryptocurrencies as Securities

  • The Crypto Rating Council has released securities ratings for IOTA, Basic Attention Token and USDCoin.
  • The CRC, backed by Coinbase, Kraken and other US crypto firms, supports regulation clarity for the industry.

The Crypto Rating Council (CRC) has evaluated IOTA, Brave's Basic Attention Token (BAT) and the USDC stablecoin over whether they should be classified as securities. 

The CRC, backed by Coinbase, Kraken and other exchanges, is a collection of major United States-based crypto firms established in September 2019. The group advocates for and promotes regulation clarity in the industry of cryptocurrency, including analyzing whether or not certain assets should be classified as securities. 

According to an April 2 post, the CRC released rating scores for IOTA, USDC and BAT, in addition to updating its rating for Maker and Polymath. The scale ranks from 1 to 5 with a lower score correlated to few or no characteristics consistent with treatment as a traditional security. 

BAT was given a rating of 2.00, with the council highlighting the coin’s utility as fully open-sourced and supporting the development and use of the Brave Browser. IOTA also scored 2.00, indicating that the currency is unlikely to be viewed as a security.

USDCoin, a stablecoin backed by Coinbase and Circle, was rated 1.00 by the council, consistent with other stable price-pegged coins such as DAI.  

While the CRC’s determinations have no official impact on the opinions of regulators such as the Securities & Exchange Commission (SEC), they do provide some insight to investors on the state of crypto-assets. 

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