This a brief and short note about the 1M$ question:
Why most of tokens prices are falling over the time?
From our own analysis, we concluded with one main answer:
No long-term view in the need or the use of the token in the projects or services sold.
Indeed, when you look at many ICOs, utility tokens would often benefit from the very short-term euphoria created by an ultra-aggressive marketing strategy, pushing the demand of token significantly high for the ICO.
BUT, as the ICO ends, here comes the question of why other people should buy these tokens on the secondary market afterwards?
And why the joiner at the ICO should hold his tokens over the long run?
Most of the tokens issued in the market would answer “no reason” to these two questions. Why?
Because most ICOs were firstly made to raise fund, of course to develop a project, but were really these tokens investors willing to use the services?
Is the value of the token at the ICO worth the real added-value provided by the developed project or not?
Actually, all is about the real dynamics of the token and how people have an incentive to interact with the project on the long run.
Our disclaimer & auto-analysis:
We are keen on underlying that we are not reproaching nor shouting against others ICO in the market.
First because there has been many very successful ones, with wonderful projects.
Furthermore, as every new world opening, many tries end to many fails which is completely normal. We are just trying to make a cold analysis of the situation. As this is only now that we have the first feedbacks from the past years, we could not get relevant conclusion before.
Also, that feedback of that new ICOs market was useful to us in structuring our tokenomics. We took into account the main weaknesses to avoid, and we tried to build a project with long-term perspectives which is for us the key element to feed the ecosystem over the long run.