ICO treasury balances steadily declining

According to research by The Block, the amount of ETH liquidated (or moved) from ICO treasury balances has been fairly steady over the past 12 months out of the 57 ICO projects we analyzed. On average, each company has liquidated/moved approximately 2,500 ETH per month (equivalent to ~$530,000 USD) over the past 12 months.

Source: Diar, Etherscan, The Block

In total, these 57 projects raised 8.2 million ETH. Of that amount, 5.9 million ETH (or 72%) has been either moved or liquidated. 

Despite a 56% price appreciation for ETH year to date, over 600,000 ETH has been moved out of these projects’ treasury balances within that same time period. Golem and Tezos have been the most aggressive sellers, liquidating (or moving) 138,000 and 121,000 ETH respectively.

Source: Diar, Etherscan, The Block

As of today, 2.3 million ETH or roughly 2.1% of the total Ethereum supply, is still held in these companies’ treasuries (of which 480,000 ETH is stuck in the Parity bug). Of the companies analyzed, nine currently have balances above 100,000 ETH with DigixDAO, Polkadot, and Golem having the largest balances.

*stuck in the parity bug

Source: Diar, Etherscan, The Block

Based on their current market cap, 12 of the companies analyzed are trading below the value of the ETH held in their treasuries alone. SingularDTV was the worst offender, with its treasury balance being worth 3.4x more than its market cap.

Source: Diar, Etherscan, Coinmarketcap, The Block

Although these ETH balances don’t consider the amount these projects have in cash reserves, a large majority of these companies have yet to generate any meaningful revenue. As a result, it’s likely we see a continued sell-off of these treasury balances over time to cover the cost of operating expenses.

ICO treasury balances steadily declining written by Matthew Yamamoto @ https://www.theblockcrypto.com/2019/07/29/ico-treasury-balances-steadily-declining/?utm_source=rss&utm_medium=rss&utm_campaign=default July 30, 2019 Matthew Yamamoto

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