“Burning” your tokens if your ICO doesn’t go well


ICOs are said to surpass the volume of IPOs in the future. Initial coin offerings are literally booming around the world, where even Youtube uploads education videos on how to create your own ICO. Many companies try to raise money by issuing tokens in several rounds and fund their business.

What happens, however, when your ICO volume plans don’t go well? One Australian start-up is currently facing this question.

BitCar is a luxury car startup founded in Australia. The company is creating a platform based on blockchain that aims to provide cryptocurrency payments for partial ownership of car brands such as Ferrari, as stated by Business Insider. The initial plan was to raise around $25m with the ICO, which was launched last year.

The company has already raised around $6 million in its pre-sale round. However, the goal was $25 million by the beginning of 2018. The next round, the public one, raised just under $ 3 million, making the total $9.5 million, a short of around $15 million of the initial goal.

Given the unsuccessful ICO, the company’s founders have stated that they will burn half of the allocated tokens. The burning of the unsold tokens will allow the company to improve the supply and value of its already sold tokens. The Business Insider pointed out that the raised amount of $10 million will go towards creating the platform and onboard users once everything is ready.

According to Bitcoin News more than 45% of all ICOs launched in 2017 failed. That seems to be a very high percentage given the massive funds that are raised. The issue many experts state is how is the responsibility of failed ICOs going to burden the cryptocurrency market, given the ever rising popularity of initial coin offerings. This is where regulation will come into play.

 

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“Burning” your tokens if your ICO doesn’t go well

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