According to the analytical firm Xangle, a third of retail American investors who took part in initial token offerings (ICOs) consider themselves deceived.
a survey of 600 users who participated in the ICO in the period from 2017 to October 2020. Judging by this period, Xangle specialists were not limited to investors who were caught up in the ICO boom. Only 22% of respondents invested in ICOs in 2017, while in 2018, 35% of investors were interested in initial token offerings, 26% of investors first entered the industry in 2019 and 9% – in 2020.
46.7% of respondents invested small amounts-less than $1,000, 29.2% of users invested in cryptocurrency startups from $1001 to $10,000, and about 8% invested in projects from $10,001 to $20,000. 45.7% of investors said that their decision to participate in the ICO was influenced by friends, family or colleagues who told them about the projects. Other investors received information from the media, forums and social networks.
About 55% of the survey participants invested in the ICO in the hope of making a profit from their investments, 23% believed in the idea of the project and were interested in its concept, and 17% wanted to learn more about the technology on which digital currencies function. 56% of investors are planning to participate in the ICO again, but will study the proposals more seriously, as they previously failed to conduct a thorough analysis of the projects. 33% of people believe that the organizers of the ICO intentionally deceive users or hide important information from them. 17% said they did not have enough knowledge to assess whether these projects were fraudulent. Therefore, more than half of the investors surveyed believe that the organizers of fraudulent ICOs should be criminally responsible.
In addition, the study participants were asked the question: “What is holding back the development of the cryptocurrency industry”? 27.5% of investors said that its development is hindered by regulatory oversight. 23.7% pointed to the lack of awareness of the population about cryptocurrencies and the principles of their work, and 14.5% of users called incomplete disclosure of information about cryptocurrency projects during the ICO.
Recall that since the beginning of 2020, the US Securities and Exchange Commission (SEC) has collected more than $4.68 billion in fines and confiscated illegal income. Of these, $1.26 billion was paid by the organizers of unregistered ICOs.