Op-ed

Why Was the Forex Industry among the First to Engage in ICOs?

Forex brokers were more than ready when the ICO boom started, hence their keenness to jump on the bandwagon

Some inexperienced investors consider the current situation to mark the end of the crypto industry hype. And they are right – the hype is gone. But this doesn’t mean that there is no future for the market. It will just become more mature. Many professionals see the current situation as an opportunity since fewer companies going for an ICO also means lower competition. Besides, it also means lower costs for funding goals.

Why Forex Companies Were Quick to Engage in the ICO Feast?

Forex companies work in a continually changing environment and have gotten used to innovations, catching trends, and flexible strategies. Big players have their own IT and Product Development departments, so they can quickly detect evolving patterns, and are quick to jump on the train with the help of in-house experts.

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If we talk about ICOs, it all comes down to marketing, and there are obvious reasons for that. We need to acknowledge that marketing costs are among the largest expenses of any company. An ICO can easily cost anywhere between $500,000 and $1,000,000. PR and marketing can be up to 90 percent of these costs.

In most cases with ICO promotion, the money is just wasted away without any effect for the business. If a company makes costly marketing mistakes, it will feel the effects immediately once the hype is gone. When the market achieves a more stable growth, it’s essential to optimize every part of your marketing campaign.

This is where Forex firms have another advantage – they have great marketing that can generate leads and attract the interest of their target audience. What’s the formula for a successful ICO? A detailed White Paper, a professional landing page, and marketing content that works. Forex companies have all of this at their fingertips and have developed the entire process in the early 2000s.

What Now?

Is the ICO world dead? Indeed, the recent months were quite slow, according to CoinDesk’s ICO Tracker. The immense level of demand we saw in late 2017 will hardly come back in the coming years. However, there’s still a lot of money changing hands, and plenty of chances to see more big projects remain.

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Besides, we can see the continued blockchain integration by huge players such as Amazon Web Services (AWS), Microsoft, and Facebook. I have no doubt that blockchain technology will continue to modify and improve the way businesses are run.

Despite the market downtrend in Q3 2018, I still see healthy growth of new blockchain players, new coin listings, and the number of ICOs throughout the quarter.

Recently, we witnessed the completion of the largest ICO ever – EOS, which was able to raise an impressive $4.2 billion.

On the whole, I must say that the cryptocurrency and ICO markets have much in common with the Forex industry with only one exception – all the processes that Forex has overcome over the past decades, the crypto industry went through in just a few months. History repeats itself – you simply need to learn its lessons.

Valentina Drofa is the CEO of Drofa Group, a regular contributor to Forbes Russia, and a Member of the Advisory Council for Financial Education and Consumer Protection of the CIS countries.

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