Not all IDOs go to the moon. Check out which tokens made the cut for worst performing IDOs of 2021.
Disclaimer, Dec. 9, 11:45AM EST: this article has been updated to the correct DEPO IDO. The DEPO IDO referred to in this piece is DePocket (DEPO), not DEPO (DEPO).
In the last few months, initial DEX offerings (IDOs) have garnered a huge amount of attention as a way to access some of this year’s most attractive projects at their very earliest stages — thus putting investors in a great position to profit.
However, while many IDOs do indeed go on to put on an impressive performance — as seen in our best performing IDOs article — others go on to fail completely, leading to shattering losses for both IDO and open market investors.
Here, we take a look at this year’s biggest IDO failures.
This year’s absolute worst performer is EverFight, a GameFi project that launched through the Pinksale launchpad, after the project was rejected by both LaunchZone and TrustPad. The project recorded almost total losses for IDO investors, painting a stark warning for those investing in projects that lack the correct fundamentals to succeed.
Several other projects lost more than 90% of their value post-IDO, including Tidal Finance, CFL 365 Finance, DEPO, Chainswap, FM Gallery, Crypto Puzzles, Ramifi Protocol and TheForce Trade. Many of which were launched by some of the more obscure launchpads, including Lemonade, ZeroSwap and BlackOcean. Notably, CFL365 Finance boasted the world's "first dual chain quintuple IDO launch" in August but still went on to fail miserably, indicating that quality is far more important than quantity when it comes to launchpads.
KelVPN, Showcase, ETHA Lend, Carbon, Daisy Launch Pad, MerchDAO and Liquidifty are among those that lost between 80-90% of their value following their IDO. Of these, Showcase stands out as perhaps the most intriguing, given that the IDO was hosted by DAO Maker — a launchpad associated with several of this year’s best performing IDOs.
Remember, past performance can be an indicator of future success, but nothing is ever guaranteed.
Lastly, Moma Protocol, Cook Protocol, Greenheart CBD and Vaulty each lost close to 80% a pop. Shattering losses by any measure, particularly for those that expected to net a hearty profit by securing a slot in their IDOs — which isn’t always a simple task.
That said, though these projects are now in the depths of the trenches, many did achieve positive returns for a (typically very brief) time, which means many IDO participants may have been able to escape with a profit. Nonetheless, in these cases, holding long term proved to be detrimental.
Want to know how to predict in advance if an IDO is likely to fail? Check out our five tips on how to spot an undervalued project. If the project doesn’t meet these criteria, it might be wise to skip it.
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