Using publicly available sources, Satis Group LLC classified initial coin offerings (ICOs) with market capitalizations of at least 50 million USD by quality, following an ICO's evolution from white paper, fundraising, to eventual trading online. Their findings include the eye-popping claim that 80% of ICO's are scams, and only 8% managed to trade on a exchange.

Study Claims 80% of ICOs are Scams

New York-based Satis Group LLC, formed from the ashes of The Argon Group firings last year, bills itself as a "premier ICO advisory firm." Researchers Sherwin Dowlat and Michael Hodapp published a novel way to classify and rank ICOs titled, ICO Quality: Development & Trading.

The study begins by breaking down ICOs into 6 groups: Scam, Failed, Gone Dead, Dwindling, Promising, Successful. "On the basis of the above classification," they wrote, "we found that approximately 81% of ICO's were Scams, ~6% Failed, ~5% had Gone Dead, and ~8% went on to trade on a exchange."

Scams were defined by researchers as "Any project that expressed availability of [an] ICO investment (through a website publishing, ANN thread, or social media posting with a contribution address), did not have/had no intention of fulfilling project development duties with the funds, and/or was deemed by the community (message boards, website or other online information) to be a scam." That seems, at first reading, to be a little on the loose side. However, very few studies have tried to quantify community sentiment, and this might be their attempt.