BitMEX Research Releases Report on Profits Made by ICO teams Through Their Own Tokens
BitMEX Research collaborates with TokenAnalyst to evaluate the $24 billion worth of tokens ICOs distributed among themselves.
The research, entitled Tracking US$24 billion Of Tokens ICO Makers Allocated To Themselves, finds $24.4 billion worth of tokens are controlled by ICO teams. Liquidity is said to be minimal when compared to the amount issued for the realized value to be reached. Today, due to a drop in token market value, the amount falls to approximately $5 billion with $1.5 billion transfers originating from team addresses - the report states these are ‘possibly disposals’.
The findings concentrate on the treasury balances of ICOs running on the Ethereum network. The ICOs studied by the researchers are Veritaseum (VERI), SingularityNET (AGI), Salt Lending (SALT), Maker (MKR), IoT Chain (ITC), among others.
How ICO Teams Profit According to BitMEX Research
Ofttimes, ICO teams profit in two ways. The first is through trading the issued tokens, mostly in exchange for ETH. The second is by supplying (minting and burning) themselves with their own tokens.
ICO project teams issued themselves a little bit over $24 billion tokens. With a 54% loss in value from market price reductions, these teams raked in $13 billion.
In conclusion of the report, the research group cites the analysis shows the ICO market’s deficiency in standards and transparency, mainly in the tokens distributed to the founding teams who are allowed to mint, burn, trade their own tokens.
According to the report, the data researchers gathered supposes that the date of token issuance corresponds to the date the initial price data was made available on CoinMarketCap which might be an ‘unreliable assumption’. It also mentions that the analysis is taken from smart contract data and patterns of transactions and not based on policies and documents of the projects being evaluated.
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