Cryptocurrency headlines in 2017 and 2018 centered on token sales that collected hundreds of millions of dollars in minutes. Regulators in the United States, Switzerland along with Singapore responded with subpoenas, cease-and-desist orders, and fines. Despite the legal pressure, new token sales still appear each quarter, and investors monitor them for asymmetric upside. The following sections describe the largest token sales by capital raised or by post launch price appreciation.
An initial coin offering is a method through which a start up mints a new digital token and sells it to the public in exchange for Bitcoin, Ether, or fiat currency. The token usually grants access to a software platform – voting rights over protocol parameters, or a claim on future cash flows. Observers judge a sale successful when the treasury receives a large amount of capital. Traders judge the same sale successful when the token price multiplies after it lists on an exchange.
EOS
Block.one, a Cayman Islands company with offices in Hong Kong but also Blacksburg, Virginia, designed EOS as a delegated-proof-of-stake network capable of processing millions of transactions per day. The protocol uses a constitution, arbitration forums in addition to on-chain governance to resolve disputes without hard forks.
The EOS token sale ran for 350 consecutive days, from June 26 2017 to June 1 2018. Participants contributed 7.12 million Ether, worth approximately 4.2 billion United States dollars at the closing price. The smart contract issued one billion EOS tokens. The sale set a record for the largest token sale in history and represented roughly twenty five percent of all capital raised by token sales during the 2017 – 2018 boom. The network launched on June 14 2018. Block.one paid a twenty four million dollar civil penalty to the United States Securities besides Exchange Commission in 2019 for conducting an unregistered securities sale.
Telegram Open Network
Telegram Group Inc., the company behind the Telegram messenger, created the Telegram Open Network to embed a native cryptocurrency, Gram, into the chat application. The network promised sharding, instant hypercube routing, and a Byzantine fault tolerant consensus mechanism capable of finalizing blocks in five seconds.
Between January or March 2018, Telegram raised 1.7 billion United States dollars in two private placement rounds from one hundred seventy five accredited investors. The company filed Form D notices with the United States Securities next to Exchange Commission claiming exemption from registration under Rule 506(c). The regulator filed a complaint on October 11 2019 – alleging that Gram tokens constituted unregistered securities. A federal court issued a preliminary injunction on March 24 2020 – halting distribution. Telegram abandoned the project on May 12 2020 and returned 1.2 billion dollars to investors after deducting loan amounts and legal fees.
Tezos
The Tezos Foundation, a Swiss non profit, conducted a token sale from July 1 to July 13 2017. Contributors sent 65,627 Bitcoin and 361,122 Ether to a smart contract. The proceeds equaled 232 million United States dollars at the spot prices on July 13. The foundation allocated the capital to protocol development, security audits next to ecosystem grants. The network activated on September 17 2018 after a twelve month governance dispute and class-action litigation. The litigation settled for 25 million dollars in August 2020.
Polkadot
The Web3 Foundation, a Swiss entity founded by Gavin Wood, conducted a token sale on October 15 2017. The sale offered 5 million DOT tokens at a price of 28.80 dollars each. The treasury received 145 million United States dollars in Ether. The foundation used the capital to build the Polkadot relay chain, parachain auctions, cross-chain message passing. The network launched on May 26 2020.
Ethereum
Vitalik Buterin announced the Ethereum project in a white paper on November 27 2013. The protocol extended Bitcoin with a Turing-complete virtual machine and a fee market denominated in a native token called Ether.
The token sale ran from July 22 to September 2 2014. Participants purchased Ether at a rate of 2,000 ETH for 1 BTC. The sale collected 31,529 Bitcoin, worth 18.4 million United States dollars at the closing price. The network launched on July 30 2015. On March 21 2024, Ether traded at 3,496 dollars per token – representing a 6,400-fold return against the initial Bitcoin price.
NEO
NEO, originally named AntShares, is a blockchain platform developed by Onchain, a Shanghai-based company. The protocol supports digital identity, smart contracts along with tokenized assets. The consensus mechanism delegates bookkeeping to elected nodes.
The token sale took place between August but also September 2016. The team sold each NEO token for 0.032 dollars. The total proceeds equaled 4.5 million dollars. On January 15 2018, NEO reached an all time high price of 180 dollars. On March 21 2024, the token traded at 14.83 dollars.
Alias
Alias, formerly Spectrecoin, launched in November 2016 as a privacy centric cryptocurrency. The protocol uses ring signatures, stealth addresses in addition to Tor integration to obfuscate transaction graphs.
The token sale priced each Alias token at 0.001 dollars. On September 1 2021, the token reached 0.15 dollars, a 150-fold return. On March 21 2024, the price fell to 0.01341 dollars.
Ark
Ark is a delegated-proof-of-stake blockchain that offers push button deployable blockchains and a bridging mechanism to connect external networks. The protocol uses a sixteen second block time and eight-second finality.
The token sale took place from November 7 to December 11 2016. The sale price was 0.04 dollars per token. On January 9 2018, Ark reached 10.91 dollars. On March 21 2024, the token traded at 1.12 dollars.
Stratis
Stratis Group Ltd., a London-based company, built a blockchain-as-a-service platform that supports C# smart contracts and sidechains pegged to the main network. Microsoft listed Stratis in its Azure Blockchain-as-a-Service catalog.
The token sale ran from June 21 to July 26 2016. Participants purchased 98 million STRAX tokens at 0.01 dollars each. The treasury received 915 Bitcoin, worth 675 thousand dollars at the time. On March 21 2024, STRAX traded at 1.50 dollars.
