Research outfit Xangle has found that a third of sampled retail investors in the United States felt “deceived” by initial coin offerings, or that the projects had withheld information from them.

Notably, Xangle’s survey is small-scale, based on 600 respondents who invested in an ICO sometime between 2017 and October 2020. The majority (44%) of those surveyed were between 25 and 44 years old, with more women represented than men, at 58%. 

On this basis, Xangle suggests there is “no such thing as a typical ICO investor,” though it does not give more insights into its survey methodology and choice of respondents. 

However, Xangle does note that surveyed retail investors were not confined to those caught up in the early ICO boom. Only 22% of the respondents first invested in 2017, whereas 35% first invested in 2018, 26% in 2019 and 9% in 2020.

The lion’s share of respondents (46.7%) invested a small sum, less than $1,000. After this, a significant share of investors (29.2%) invested between $1,001 and $10,000. Close to 8% invested between $10,001 and $20,000.

Informal ties and word-of-mouth played an outsized role in these investors’ decisions: 45.7% said that either friends, family or co-workers were the source of information for the ICO they chose to invest in. After this, media coverage, forums and social media sites were the source of information for 15%, 19.2% and 17.7%  of investors, respectively.

Close to 55% of respondents invested in the ICO because they were motivated by seeing a potential return on their investment, 23% did so because they believed in the idea behind the project, and 17% because they wanted to learn more about the technology behind crypto.

A constant theme in the survey is investors’ feeling that they had failed to conduct sufficient research into the project, with almost 56% saying that they would invest in an ICO again in the future, but would investigate the offering more thoroughly. Close to 33% felt the ICO had intentionally deceived or withheld information from them. A further 17% responded that they “didn't know,” implying they still did not have sufficient information to even assess, in retrospect, whether or not the ICO was misleading or fraudulent. 

These stats perhaps explain the fact that at 54%, the majority of respondents believe ICO operators should be held criminally liable for projects found to have been fraudulent. 

Out of five defined answers to the question, “What’s holding crypto back?” three answers referred to matters of information and oversight; 27.5% cited the lack of awareness about what crypto does and how it works in general; 23.7% pointed to under-regulation; and a further 14.5% cited a lack of transparency in ICO disclosures.

Earlier this year, Cointelegraph ran a piece titled “The Death of the ICO,” pointing to the increased role and impact of U.S. regulators within the token offering space in the years following the industry’s initial 2017 boom.