The newest Crypto Trader Digest is out. https://t.co/owEvwcu5hW
— Arthur Hayes (@CryptoHayes) November 21, 2018
In the report, Hayes and his team of analysts have identified at least 12 blockchain projects and companies that raised more than $50 million via initial coin offerings (ICOs) but have yet to release a token onto the secondary market.
A quick look through the list of tokens reveals that a majority are backed by big-name enterprises and venture capital firms.
Among these names is tZERO, a blockchain platform for capital markets and subsidiary of Overstock.com, which recently secured a letter of intent from GSR Capital (GSR), a private equity firm organized in Hong Kong, to purchase $160 million in tZERO Security Tokens.
Similarly, Basis, formerly known as Basecoin, raised $133 million ICO from major players, including Bain Capital Ventures, Andreessen Horowitz, Valor Capital, Alphabet’s venture arm Google Ventures and Digital Currency Group, among others.
Despite all of this institutional capital, BitMEX’s analysis doesn’t believe these tokens will retain the value from their previous raises in the current market. For example, Hashgraph’s implied valuation is around $6 billion, a ludicrously high valuation that would make it the 4th largest cryptocurrency.
“2019 is going to be the year of reckoning for many funds. You can mark something to an absurd level in year 1. But the meter starts again on January 1st. If these things come to market, there will be no accounting tricks to hide the gargantuan losses that these funds will post,” predicts BitMEX in their analysis.
Put simply, BitMEX concludes, “Given the large amount of token supply out there, who will buy this shit?”
Disclaimer: This article’s author has cryptocurrency holdings that can be tracked here. This article is for informational purposes only and should not be taken as investment advice. Always conduct your own due diligence before making investments.