Arthur Hayes Advocates for Revival of Decentralized ICOs
Arthur Hayes, co-founder of BitMEX, advocates for a return to decentralized, retail-focused initial coin offerings (ICOs) in his manifesto, “How to Make ICOs Great Again.” He critiques the current influence of venture capital (VC) firms and centralized exchanges (CEXs), which prioritize institutional interests over retail investors.
Hayes argues that the crypto landscape has deviated from its foundational principles of decentralization and community empowerment. He likens the influence of VCs and CEXs to a "CEXually transmitted disease," stating that they push projects towards inflated valuations that exclude ordinary investors. He questions, “Why did we forget that crypto was meant to empower retail investors?”
He identifies three factors contributing to crypto's success: decentralization challenging traditional power, revolutionary blockchain technology, and the speculative pursuit of financial gains. However, he notes that retail investors have been marginalized by projects catering to institutional players. Meme coins exemplify a more inclusive model, allowing retail participation without gatekeepers.
Hayes proposes reviving ICOs as a means to restore community power through direct fundraising and broad participation. He acknowledges the failures of many 2017 ICOs but views their speculative nature as beneficial, enabling retail investors to seek significant financial rewards. He states, “Retail investors would rather take a risk on a small, decentralized project than invest in a heavily inflated VC-backed token.”
He outlines a roadmap for revitalizing ICOs, emphasizing decentralization, faster token issuance, and improved technology. Advances in blockchain infrastructure, such as lower transaction costs and enhanced scalability, make ICOs more feasible. Non-custodial wallets and user-friendly platforms further lower barriers to entry, facilitating broader participation.
Hayes advises against centralized platforms and VC-backed projects with high valuations and low circulating supply. He encourages the community to embrace the speculative and democratic essence of decentralized ICOs, stating, “It’s time to reject VC dominance and return to a system where retail investors can dream big and take bold risks.”
With indications of a new bull cycle, Hayes predicts a resurgence of ICOs driven by retail investors and decentralized platforms like Pump.fun and Spot.dog. He believes these tools will foster innovation, restoring the spirit of experimentation and financial inclusion in crypto.