With 2018 drawing to a close, it undoubtedly feels like a good time to reflect on another fascinating 12 months for the world of cryptocurrencies and initial coin offerings (ICOs).
With research released in June by PwC, Strategy and Crypto Valley Association suggesting that ICOs raised $13.7 billion in just the first five months of 2018 – almost double the amount raised across the whole of 2017 – it is safe to say that they have enjoyed an incredibly strong performance in recent times. However, while the figures are undoubtedly impressive, some concerns remain regarding the ICO fundraising concept.
Can ICOs Be Trusted?
Interest in cryptocurrencies and in buying Bitcoin is very high, but the concept of digital currency in general continues to attract a range of discussion and debate in the finance world. When it comes to ICOs specifically, the major concern dominating ICO news appears to be whether the mechanisms can be trusted.
Research from the Statis Group which was released in July this year put a spotlight on the matter, with the study claiming that 80 percent of ICOs in 2017 were actually scams. Now, a new report has examined the issue of security and raised some important issues which those behind ICOs will undoubtedly be keen to address in the months ahead.
Making ICOs Safe And Secure
Cybersecurity company Positive.com specializes in assessing infrastructures and providing protection strategies, as well as researching the latest emerging issues. In a new audit report, the organization found that the average ICO features at least five security flaws. It was also revealed that a common point of vulnerability related to smart token contracts, with 71 percent of the companies analyzed being discovered to have issues at the stage.
Of all of the audits undertaken by Positive.com for clients involved in ICOs and blockchain deployment in the banking sector in 2017, just a single unnamed entity was found to not contain any critical flaws. In addition, 47 percent of vulnerabilities identified were of medium to high severity.
Getting It Right From the Start
IT and cybersecurity are vital issues for businesses of all kinds, but it is clear that they are fundamental to an ICO functioning correctly. After all, investors need to know that their vital funds are reaching the relevant project.
So, when does the issue of security become key? Comments from Leigh-Anne Galloway, Positive.com’s lead cybersecurity officer, suggest that guaranteeing a system is secure should be a core priority from the outset. Discussing the company’s report, she said: “The moment a company goes public with the intention of launching an ICO marks the beginning of cybercrime.”
A Key Consideration For ICOs in 2019
The findings of Positive.com’s report into the security of ICOs undoubtedly seem to suggest that, as we head towards 2019, a key priority for businesses in the New Year will be ensuring that their systems and processes are ultimately up to scratch.
With public awareness and interest in cryptocurrencies on the rise, it is only understandable that ICOs are gaining more and more attention. However, while they may be very popular, it seems that providing reassurances on security could well be vital to them growing even further in the future.