Analysis & Opinions

Analytical Report: IEOs in 2019-2020

Key Takeaways:

1. IEOs raised $1.7 billion in 2019.

2. Only four out of the top 15 IEOs had a positive return on investment (ROI) at the time of writing.

3. The average ROI of the top 15 IEOs was 18%.

4. Matic was the best performing token out of the top 15, with an ROI of +577% (Binance Launchpad).

5. MultiVac (-92%) and VeriBlock (-94%) were the worst performing IEOs out of the top 15 in terms of ROI (on KuCoin Spotlight and Bittrex respectively).

6. Binance was the most popular launchpad for the top 15 — eight out of the 15 top IEOs (53%) were conducted on this platform. In contrast, LaToken was the most popular launchpad for the entire IEO market, launching more than 140 IEOs in 2019.

7. Only two IEOs out of the top 15 (13%) raised more than $10 million — GateChain Token ($64 million) and LEO ($1 billion).

8. The best launchpad in terms of average ROI was Binance with +144%, and the worst was Bitforex, with an average ROI of -83%.

Disclaimer: All numbers used in this article were obtained on March 1, 2020. This is a co-brand report of SMC Capital and bigX.


2019 saw the rise of the startup crowdfunding phenomenon called the initial exchange offering, or IEO, dubbed by industry insiders as the “reincarnation of the initial coin offering (ICO).” IEOs quickly became the hottest topic in the blockchain market, but began to see a significant decline in Q4 of 2019. Patterns from the ICO period, such as strong FOMO around several tokens, immense volatility, hefty profits and outsized losses contributed to the dubious nature of the IEO market. 

Toward the end of 2019, IEOs raised less money, fewer projects conducted IEOs and numerous exchanges shut their launchpads down, leading many to believe that 2019 would be the last year for IEOs. Today, the top 15 IEO projects of 2019 continue to struggle to keep their floating token price above their IEO price. 74% out of the top 15 IEOs are in the red, delivering an average loss to their investors of -53%. 

However, much to the industry’s surprise, the IEO market did show some positive developments in 2020. For example, India-based exchange WazirX conducted a successful IEO on Binance, raising $2 million and delivering a notable ROI to their investors (at the moment of writing, the ROI for WRX was +892%). Several exchanges remain quite active in the market, as there continues to be a supply of projects and demand from investors. Our research report aims to look at the trends driving this market and the prospects for IEOs in 2020 and beyond.

What Are Initial Exchange Offerings (IEOs)?

IEOs are similar to ICOs, but the offering is instead conducted through a cryptocurrency exchange, which handles aspects like KYC checks on buyers, listing, reporting and other related functions. Although IEOs are currently the subject of considerable hype, many market participants, including senior executives of the largest cryptocurrency exchanges, admit that IEOs are more of a PR and marketing tool rather than a fundraising option. Although many projects do raise money, most end up spending the majority of funds raised (up to 85%) on market-making to support the token price. 

Most popular launchpads also subject IEOs to strict conditions. For example, only a limited number of investors chosen by random lottery can participate, and strict limitations regarding the number of tokens available per investor apply. IEOs help to popularize projects and grow the token holder community, but their usefulness in terms of raising capital is questionable. IEOs help exchanges attract new traders, increase trading volume and drive additional revenue, but we have strong doubts about the real value for startups.

Fundraising Results

IEOs Raised $1.7 Billion in 2019 

IEOs performed quite well in 2019, with May being the most successful month in terms of funds raised. The huge spike in May fundraising is due to Bitfinex’s LEO IEO, which raised $1 billion USD.

IEO industry fundraising results in 2019

The majority of IEOs (67%) were conducted between June and December, but the majority of funds were raised from January to June. It is likely that LEO’s $1 billion offering in May led many projects to believe that IEOs might bring them additional funds and secure a free listing on an exchange. With increased demand from projects, executives at crypto exchanges also realized that IEO launchpads might be an excellent source of additional income. The combination of these factors led to a phenomenal year for IEOs.

IEOs month by month


Most IEO projects in 2019 came from the US, Estonia, Singapore, South Korea, Hong Kong and the UK. Altogether, these countries accounted for more than 50% of all IEOs and raised a total of $1.45 billion USD, about 85% of the total amount of funds raised.

*Jurisdiction is the place of factual registration for startups


The Most Popular Launchpads by Number of Projects

Latoken, ProBit and p2pb2b were the most popular exchanges for projects seeking to conduct an IEO in 2019. In total, at least 250 projects conducted IEOs on these exchanges.

The most popular launchpads

Top Launchpads by Funds Raised

Over half of IEO funding was raised on the Bitfinex Launchpad, due in large part to LEO’s outsized $1 billion IEO. Excluding the LEO IEO, most 2019 IEO funds were raised on the LaToken exchange launchpad.

Raised in %

* and other smaller launchpads (less than 0.1%).

The Best Performing Launchpads (ROI)

The Best Performing Market Sectors

The most successful market sector for IEOs was protocols, which performed quite strongly (+124%). In contrast, the Internet of Things (IoT) sector delivered the worst ROI. Notably, IEOs followed the same trend as ICOs, where protocols also dominated in terms of ROI.

What Happened to the Top 15 IEOs?

The secondary market performance of the top 15 IEOs reveals that most IEOs are still struggling to keep the token price higher than the token sale. Only four projects out of the top 15 (26%) are still providing their investors with a positive ROI. The average loss for projects in the red is -53%, while the average ROI for successful projects is +209%.

Projects with a negative ROI have collectively raised $1,050,430,000, which is 62% of all funds raised by IEOs and 93% of funds raised by top 15 IEOs.

The Top 15 IEO’s ROI since IEO

The vast majority of top 15 projects conducted offerings on Binance and successfully reached their hard caps. Bitfinex’s LEO raised the largest amount of funds, but its performance has been lackluster. LEO has only 1,754 token holders on both Ethereum and EOS, it has the lowest volume to market cap ratio and its daily volume is about 10 times lower than that of BitTorrent. Matic currently has the best ROI and a 103% volume to market cap ratio.


In many ways, IEOs were the last echo of the ICO era — when new startups were able to raise millions of dollars with no product or clear roadmap. Many tokens posted stellar performance in the first several days or even weeks after listing, but lost the vast majority of their token value within several months. IEOs and ICOs did show that almost anyone can launch a project and get millions of dollars in funding from retail investors simply by having a good idea, a solid team, a vibrant community and convincing arguments why the token price will grow after listing. 

However, the performance of the top 15 IEOs is unmistakably similar to projects in the ICO era. Startups became public too fast and spent their attention and resources on boosting the token price instead of developing their product. As a result, the majority of IEO tokens lost the lion’s share of their value during the first quarter after listing. Considering all these things, it appears that the IEO era was more about speculation and trading than fundraising and startup development.

Future Trends

We recognize four key trends in the IEO market in 2020

1. Regional Focus

Reputable exchanges will seek out commercial partnerships with strong local players from crypto-friendly markets to open up additional demand. The WazirX IEO launched on Binance discussed earlier in this article is a case in point. This strategy makes sense for exchanges because IEOs are a free tool for onboarding new users, boosting trading volume and pulling in market-making fees.

2. IEO Slowdown

We expect to see significantly less IEOs being launched in 2020 year-over-year. Considering the ROI of IEOs examined in this article and decreasing demand from investors, we predict that the IEO market will decrease significantly, both in total amount of projects launched and volume of funds raised. However, we do not expect this market to disappear. The silver lining of an IEO slowdown is that new IEO projects must be of higher quality, preferably with a first round of venture capital backing.

3. Exchanges Will Change Rules

If exchanges hope to continue offering IEOs as a service, they will need to loosen their conditions to onboard new projects. Among the first IEO requirements set to be revisited are market making allocations and token price discounts. At up to 85% of all funds raised, required market making allocations for new projects are not reasonable. Demands for IEO projects to significantly decrease the token price below private sale prices, undercutting initial investors, will also be loosened. However, exchanges may increase initial capital requirements and perform more thorough due diligence on new projects.

4. Increased Real-World Interest

As digital and traditional markets recover from the financial crisis and rebound to health in the second half of 2020, continued liquidity troubles will force real-world businesses to seek out creative new fundraising sources. Some will inevitably turn to digital currency-supported crowdsales to survive. In some industries, like HoReCa or retail, IEOs may prove well-suited for fundraising as compared to unrealistic lending conditions from banks. Potential big winners from this forecast include major crypto lending companies, which could help underwrite real-world business deals.

This article is intended to be used and must be used for informational purposes only. It is important to do your own research and analysis before making any material decisions related to any of the products or services described. This article is not intended as, and shall not be construed as, financial advice.

The views and opinions expressed in this article are the author’s own and do not necessarily reflect those of CoinMarketCap.

John is a founding and managing partner at NYC-based VC and consulting firm SMC Capital. Prior to founding SMC Capital, John worked as CMO and CBDO of ICORating, the largest blockchain industry rating company, leading ICORating's international expansion. John also served as the CMO of one of the largest travel platforms in Europe. He also ran his own consulting firm, working with some of the world's largest banks, retailers, startups and venture funds. John's expert commentary on the blockchain market has been published by leading media, including Forbes, Business Insider, Wall Street Journal, INC,, Cointelegraph and many others.

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