The much-hyped initial coin offering for decentralized storage project Filecoin concluded on Thursday. Despite being open only to accredited investors, the Filecoin ICO raised $257 million, shattering the previous record for a token crowdsale.
Simply put, Filecoin plans to leverage unused data center and hard drive storage space to build a decentralized storage network. In exchange for contributing extra storage space to the network, users will receive Filecoin tokens which can then be exchanged for other currencies. Conversely, those in need of storage can purchase tokens and exchange them for storage space. Purportedly, this will drastically lower the cost of cloud storage.
The Filecoin ICO began on August 10, having already raised $52 million from venture capital firms in a private presale. In an effort to ensure compliance with U.S. securities regulations, the ICO was restricted to accredited investors. This barred many ordinary investors from contributing, but the crowdsale website still received so much traffic that many investors had trouble accessing it.
Filecoin’s funding model encouraged early participation. The token price started at $1 and increased with every subsequent investment. Within hours, the crowdsale had raised nearly $190 million and the token price had reached $4.68.
Following the chaotic first day, contributions slowed but continued to tick upward. Ultimately, the token crowdsale raised more than $205 million by its conclusion on September 7. When coupled with the $52 million raised during the private presale, the Filecoin ICO raised a record-setting $257 million.
Filecoin thanked investors for their outpouring of support.
Deeply honored & humbled by huge support around the 🌍 — investors from 50+ countries. Incredibly excited to bring Filecoin to life.
— Filecoin (@MineFilecoin) September 7, 2017
ICO funding levels have ratcheted up throughout 2017, and year-to-date ICO contributions are rapidly approaching $2 billion. Consequently, cybercriminals have found the space to be an ideal venue to launch attacks. A recent report estimates that as many as 10% of all ICO-marked funds are stolen, primarily via exploits or phishing attacks.
The previous record was held by the Tezos ICO, which garnered $232 million in contributions during its July “fundraiser”. Tezos has taken steps to secure its windfall and has diversified part of its assets into fiat currencies, precious metals, stocks, bonds, and a venture capital fund.