Sources of Capital for ICOs and Bitcoin Whales

Autonomous Next has analysed the sources of capital for the recent surge in Initial Coin Offerings (ICOs). Our findings show that the digital currency ‘whales’ are split into five categories: (1) mining pools, (2) exchanges, (3) currency traders, (4) ICO investors, and (5) traditional financial investors.

Firstly, the mining pools (e.g.  Antpool) are the early beneficiaries of the crypto-currency wave and represent a collection of specialised computing clusters that centralise their computing power to gain the next coin distribution. Exchanges represent the retail and over-the-counter venues that allow for the conversion between fiat and digital currencies (including coins/tokens). Currency traders are funds that focus on the trade of crypto-currencies with the aim of making a profit rather than the investment into tech projects. ICO investors, however, are larger funds with institutional or private capital to invest in emerging technology projects. Finally, traditional financial investors represent venture and Angel investors in the equity of companies working on Blockchain solutions. Together, these groups account for over $700 million of ICO funding.