The tokenized project Cofound.it abruptly ceased operations. The project’s CFI token was trading on Bitfinex.
The decision to discontiue operations follows deliberations regarding changing market conditions.
The Cofound.it Platform
2018 has not been particularly kind to tokenized projects. Even projects that secured listings on the major crypto exchanges faced difficulties.
According to the Cofound.it team, “The core idea of Cofound.it was to create an alternative VC ecosystem built around crowdfunding, democratisation and transparency.”
However, the team says, “Instead, the larger ecosystem developed and transformed into something completely opposite.”
The team further states, “Instead of waiting for the market to turn around, we have decided to opt for creative destruction, wind Cofound.it down and distribute the assets to the token holders.”
The CFI token shows an increase of 20% on the crypto exchanges following the statement.
CFI Token and Market Trends
The CFI token was up 20% by press time but it is significantly down from its January ATH. Many experts have praised the organization’s decision to cease operations in a dignified manner. It is important to realize that business models continuously evolve and circumstances change. Therefore, the halt of operations does not imply the failure of the larger initiative to “tokenize the world”.
However, the project has a lot to teach emerging startups and projects. It is important to consider the viability of tokenization and its long-term use strategy.
Considering the ongoing bearish market conditions, many now believe that simple app tokens are not sufficient to capture value and catalyze the usage of the network. It is essential to incorporate mechanisms that will incentivize the investors and platform users.
Many ICO consultants such as Amazix are now helping project teams with token model design.
In the words of Cofound.it, “The state of technology today does not match the hopes raised by thousands of ICO projects.”
In conclusion, the team contemplated the question of what happens when the market realizes what is going on.
“The core market disappears, there is no liquidity and there are hundreds of interesting existing projects with prototypes waiting for the core layers and infrastructure to develop and mature. From this perspective, the recovery of the market will take time.”
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