Filecoin Suspends ICO After Raising $186 Million in One Hour Clogs the System

ICO mania is still going strong despite all the hacks, repeated technical glitches, worries about wrong incentives and warnings by regulators from around the world. We just got an example of this today as Filecoin was forced to suspend its ICO after an incredible amount of money directed towards it overwhelmed the system.

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Filecoin is a cryptocurrency-powered storage network. Miners earn Filecoin by providing open hard-drive space to the network, while users spend Filecoin to store their files encrypted in the decentralized network.

If you are wondering why a decentralized file system, which is not a particularly sexy or unique product, would get so much attention from investors, you need look no further than its list of backers. Last week a group of top 150 Silicon Valley venture capital brand names invested $52 million in the project, including Sequoia Capital, Andreessen Horowitz, Union Square Ventures, Winklevoss Capital.

The Filecoin ICO has an uncapped USD target and money started pouring in a torrent of transactions as soon as the sale was open to the public (accredited investors). Soon the team behind the project reported inbound funds totalling $252 million.

We have $252MM in investments in flight as of now.

— Filecoin (@MineFilecoin) August 10, 2017

This however proved too much traffic for the ICO to handle and a backlog of conformation was created, frustrating investors that could not tell if they had got in on the action or not, just like with previous massive ICOs. The raised figure was soon after updated to match the lower amount that Filecoin was able to confirm.

Final 1st-hour average price is in the $2.65 range. Total amount raised (confirmed) to date is $186MM.

— Filecoin (@MineFilecoin) August 10, 2017

As of the time of writing this article, about seven hours after the latest update from Filecoin, the ICO remains suspended.