Sources including the Wall Street Journal have revealed that the ICO market has surpassed the $1 bln mark. This leads to concern among investors about the explosion of a bubble.



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Growth of ICOs

Tezos, Bancor and EOS have made a great contribution the this record with the fund raised of hundreds of mln USD each. In specific, these ICOs raised more than $559 mln in 2017, offering unique infrastructures and platforms built on top of the Ethereum protocol.

EOS for instance, which was heavily criticized for its controversial Token Purchase Agreement, gained popularity amongst investors within the cryptocurrency market for its infrastructure that provides an efficient, scalable and flexible ecosystem for decentralized applications and smart contract-based platforms. In spite of being well-known in the investment world, EOS also received heavy criticism for its controversial token deal.

Is Bubble Imminent ?

Still, ICO is exponentially gaining more popularity. Experts and analysts including California-based law firm Cooley LLP partner Marco Santori stated that the demand towards ICOs is increasing at an exponential rate. At the moment, it is very difficult to justify the market value of the entire ICO market and its projects. Their value is completely speculative and can’t be evaluated with real market data because no viable products or software have been deployed yet. Therefore, the question remains: Is ICO bubble imminent?

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According to the development roadmap of EOS, its software has not even passed the alpha testing phase and thus, do not have any active users or deployed platform. The primary purpose of the native token of an ICO is to act as a store of value or native currency for that platform. But, if the platform does not exist and it is not being actively utilized by decentralized applications, then quite evidently, investors will purchase tokens simply as a means of speculative investment.