IndieGoGo Cancels ICO After Raising $5 Million
While it still seems ironic that IndieGoGo (the crowdfunding platform) was using an ICO to raise funds, this endeavor is now canceled. IndieGoGo has received $5.2 Million for a community operated football league when they decided that the legal risks were too great to continue.
IndieGoGo referenced changing US regulatory policy as the cause for cancellation. They believe that their ICO was conducted within legal bounds, but because the SEC has not given a formal system by which ICOs may operate (and because regulations are changing all the time), IndieGoGo feared going afoul of regulators if they allowed their ICO to be completed.
Fortunately for investors, all funds will be returned, though no tokens will be released. It’s unclear if this is the end of the IndieGoGo ICO, or if the fundraising event will be restructured given the changing American regulatory landscape.
Though we mentioned the irony of IndieGoGo turning to ICO fundraising, perhaps this irony is only on the surface. IndieGoGo has expressed interest in using ICOs as a fundraising option for clients. In the past, IndieGoGo was limited to cash donations made directly to entrepreneurs. The ICO machine provides a novel way to streamline this process, and make investment more universally available, as funds are not collected using a single fiat currency.
Though in this bear market some have expressed doubts about the long term potential of the ICO, it may be that ICOs are the next evolutionary step in crowdfunding. If this were to prove true, it would be just another way that cryptocurrency achieves lasting mainstream use. IndieGoGo’s ICO cancellation may be a small setback for a novel use for ICOs, but we hope to see the venture revived in the future. The most efficiently ICOs are used, the better this will be for the cryptocurrency industry at large.