The market trend known as flippenning has been linked with some altcoins over time. These altcoins include Ripple and Ethereum among others. However, they are all trying their best to achieve dominance when it comes to their overall market capitalization.
Meanwhile, Bitcoin is expected to have this same story. It is the first and most prominent Cryptocurrency and has managed to dominate the market since its creation.
Even with all these records, the Cryptocurrency sphere is having a sudden change in their belief. They believe that the payment solution will not cut it for Bitcoin anymore.
It seems Bitcoin’s future is dwindling and it may likely lose its present market dominance to altcoins.
A New Flippenning?
A new Flippenning referred to as flippenning 2.0 may be the latest trend in the market. This Flippenning 2.0 may likely witness ICOs as they turn out to be hardly accessible to the general public.
As they become hardly accessible, they are gradually leaning towards the high net worth organizations and people. ICOs were built initially to favor decentralization plus an appearance of uniformity to the prices on exchanges.
Meanwhile, they have currently joined the regular investors for fundraising. Additionally, this concept of a Token Generation Event to raise funds is not sitting well with the market.
It is making ICOs soft, and the key governing bodies are out to arrest scammers involved. In the same vein, the funds raised solely by blockchain organizations via certified investors and even private enterprises have rapidly increased.
This increase has seen a large sum of $0.9 billion when compared to the sales of both ICOs and STOs that are at $1.5 billion. This gap has gradually closed as private funding has outdone the major sales.
Are Governing Bodies Igniting This Change?
The rapidly increasing regulatory scrutiny at the Token Generation Events is demanding entrepreneurs to move in the direction of regular sources of fundraising such as organizational investors.
Some of the earlier entrepreneurs that had incredible concepts could simply raise funds for their diverse projects. They did this by easily creating websites and uploading the white paper that had the contents of their project.
However, all these changed when issues of ICO scams began coming up. Judging from the research carried out by Statis group, roughly 80% of the ICOs executed in the year 2017 were written off as scams.
This has made the governing bodies highly vigilant. Lately, entrepreneurs are simply raising capital via regular modes and not conducting a public sale.
Benefits Of Raising Private Funds
Asides being simpler, private funds have other benefits such as building a convenient surrounding for the company management to aim at long term goals.
This is because, most times, the retail investors are inspired by short term goals instead and profiting from swift returns.
While the retail investors have little to offer asides their fund, private investors give the alternative to leveraging their system of expert links. This can easily aid a company in scaling swiftly and attaining long term goals.
This also enables the company to think about major advancements instead of deploying resources to make sure PR is all over the development.
To Wrap It Up
While ICOs are not strictly for raising capital, it basically doubles as a method to issue tokens among developers, Cryptocurrency enthusiasts and finally retail investors.
An ICO can offer platforms the initial nudge it needs to take off from the ground and soar high.