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    July 2, 2018

    New research claims up to $400 million USD raised through ICOs has been lost or stolen

    ICO theft stolen

    New risk assessment research into Initial Coin Offerings (ICOs) has revealed that over 10 percent of all funds raised (some 400 million USD) has been lost or stolen.

    According to a new risk assessment study conducted by Ernst & Young, an examination of 372 ICOs has revealed that as much as $400 million USD could have been stolen or lost forever.

    The report further elaborates that phishing attacks have become more and more prevalent in recent months, with hackers stealing an average of $1,5 million USD in ICO proceeds per month.

    Read: New report shows just how North Korea uses malware to steal cryptocurrencies

    Interestingly, the report concludes with the note that the volume of new ICOs has slowed; fewer than 25% of surveyed ICOs succeeded in reaching their target in November, compared to a more robust figure of 90% in June of 2017.

    Paul Brody, global innovation leader for blockchain technology at Ernst & Young, offered that the challenges facing ICOs were partly attributable to the diminishing quality of new projects.

    Quality control

    Brody staked his claim that the quality of ICOs on offer had lowered as well, quipping that “The volume just exploded, people raised their fundraising goals and the quality just dropped… we were shocked by the quality of some of the white papers, we see clear coding errors and we see conflicts of interest between the companies issuing tokens and the community of token holders.”

    The study elaborated that several ICOs fell victim to underlying software code that issued contradictory (or non-existent) disclosures.

    The report can be read in its entirety here.

    Read: Hacker escapes justice with over $400K USD in BlackWallet theft

    Have your say!

    Do you feel the quality of new ICOs on the market has diminished? Would you be more cautious to invest your funds as a result? Be sure to let us know your opinion in the comments below!

    Follow Bryan Smith on Twitter: @bryansmithSA

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