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The Majority of Cryptocurrency Startups Are Still Around After a Year of Uncertainty

Cryptocurrency startup

Today, there are at least 1,550 cryptocurrencies in the world. The top 28 cryptocurrency startups have a total capitalization that has been valued at more than $1 billion. Despite uncertainty in this market, at least 54% of the startups connected with cryptocurrency technology are still around, according to Forbes.

Whether a company succeeds or failed in the world of the new blockchain fintech companies is really determined a lot by the perspective of the person or organization making that call. recently put out its findings. According to their report, about 46% of the businesses that were able to obtain funding from initial coin offerings (ICOs) are no longer operating. This is in spite of the fact that they were able to bring in over $104 million. On the flip side of that, at least 54% of those cryptocurrency startups are still in operating today.

For companies that rely on ICOs, the failure rate is much higher than for the traditional startup companies. About one-quarter of all startup companies fail before they reach the 12-month point. That number, for cryptocurrency startups, is much higher. They fail at a rate that is almost double. When you look at the success rate for traditional startups at the ten-year mark, the number of companies that have failed is about 71%.

The whole concept of ICOs is new. Younger businesses, which are primarily in the tech industry, have started issuing and using new forms of currencies, which have been given the name “cryptocurrency.” Many companies see the use of these new cryptocurrencies as a way to get the funding they need without having to go to traditional sources such as venture capital investors. Many are looking to have the same kinds of success that was enjoyed by Bitcoin. In December 2012, one Bitcoin was worth $13. In December 2017, that number had risen to $20,00. It dropped again and by the time report was issued, the price for one Bitcoin was about $10,000.

Many people have become familiar with the traditional startup process through the television show, Shark Tank. On this show, people pitch their products and services or ideas to a group of investors. The investors provide feedback but also invest in some of the ideas they like. When it comes to ICOs, the process is very different. Cryptocurrency startups look to investors all over the world. Anyone can put their money behind a project.

There are many tokens that have been introduced. Token Data, which tracks how well these companies do, has reported that one token, put out by Sirin Labs, a blockchain startup based in Israel, had tokens that were initially valued at about $0.47, though some investors were able to get them for less than that. The most recent data for their tokens lists the value at $0.67.

Sberbank fintech pioneer, Igor Khmel, has his own startup. His company, BankEx, is a debit card cryptocurrency company. The value of its tokens started out under one dollar but had risen to $1.20. It is impossible to say what companies will be around after 12 months.

Token Date looked at 902 different cryptocurrency startups. At least 142 were not able to get the funding they required to be successful enough to launch a product, 276 of these companies had shut their doors within 12 months. There were scams and problems with theft and fraud are bigger for cryptocurrency startups than for other traditional startups. reported that the number of ICOs from Africa was exaggerated, leading many to compare this situation to the scam emails many people get claiming to be from a Nigerian prince looking to give away his fortune. Many cryptocurrency startups failed for perfectly legitimate reasons.

In January 2018, it was reported that the top 100 cryptocurrency startups had, altogether, brought in more than $1.7 billion. This is according to research collected and analyzed by ICO Box. That is a firm that handles blockchain support and services. According to the data they were able to collect in that month, they believe that the amount raised by these companies can exceed $20.4 billion by the end of the year.

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