A new report by TechCrunch indicates that as many as 1,000 crypto projects collapsed in the first half of the year. The findings paint a clear picture as to why investors should maintain a cautious approach when it comes to investments in the emerging sector which has been shrouded in a lot of mystery and uncertainty.
Collapsed Crypto Projects
The report by the news outlet is based on data from two websites, Coinopsy and DeadCoins known to keep track of crypto projects. According to the websites, dead crypto projects are most of the time depicted by a lack of social updates, low volume or a total lack of developers, dead websites and lack of wallet issues.
Based on its findings Coinopsy believes that as many as 247 crypto projects collapsed in the first half with DeadCoins similarly having a list of 830-item long list. Some of the projects included in the list include BitConnect that came to an abrupt end early in the year amidst Ponzi scheme claims. Titanium Blockchain Infrastructure which was shut down by the Securities and Exchange Commission is also included in the list.
The proliferation of fraudulent crypto projects has done little to sway investors about ICO investments. Latest findings indicate that the volume of ICO reached highs of $13.7 billion in the first six months of the year, which is nearly twice the amount of money collected the entire of 2017.
Crypto Projects Warning
The rate at which ICO projects are closing shop has already triggered a wave of warnings from authorities and high profile personalities. According to Nasdaq CEO, Adena Friedman ICOs pose the greatest risk for retail investors.
A lack of insufficient public information, transparency, regulation, and accountability according to the executive remain the biggest threat to investment in the emerging sector. A good number of people who have lost money are first-time investors who have no access to information needed to make informed decisions.
“To make it no rules at all, when companies can just willy-nilly take people’s money and offer no information at all, with no governance, that sounds to me like you’re taking advantage of people,” Adena in a Statement.