It’s now gameover for bike-sharing techs and ICOs

Dockless bike-sharing has exploded in just a couple of years, spreading to dozens of Chinese cities seemingly overnight. Technology is transforming bike-sharing and contributing to an explosion of IT-based systems that are making bike shares part of Smart Cities.
According to Xinhua news agency, more than two million bikes were available for sharing from 15 companies in Beijing alone. At the same time, no less than 40 bike-sharing companies have popped up, creating a bizarre landscape in major Chinese cities peppered with ride-sharing bikes scattered in heaps of colourful piles. Not only are these Chinese companies competing against each other, but also against local players.
We were all excited about how bike-sharing is going to disrupt the way we commute. Over time, the word “disruption” is becoming such a deceiving word. It is supposed to indicate that an improvement or an introduction of new technology is doing good, but in actual fact, it does not always take into account the full consequences of what that technology brings to the industry.
The word “disruption”
Everyone gets excited at the beginning when they hear the word “disruption”, but if you are here long enough, you know that disruption is not enough. Innovation requires more than just a disruptive idea. It requires proper planning and careful understanding of all the consequences.
In the case of the bike-sharing, there have been many companies jumping into the market thinking that they are disruptive, disrupting the way how people commute. For a good period of time, that worked very well. But again, lack of proper planning led to an inability to seed consequences in, and inevitably creating a long wave of unvented bicycles left around.
Disrupting without planning
The rapid growth vastly outpaced the immediate demand and overwhelmed Chinese cities, where infrastructure and regulations were not prepared to handle a sudden flood of millions of shared bicycles. Riders would park bikes anywhere, or simply abandon them, resulting in bicycles piling up and blocking already-crowded streets and pathways.
Initial Coin Offering (ICO)
It reminds me a lot about what happened in the ICO industry where everyone was excited about flooding the market with so many ICOs, building up their teams, collecting money from the crowd, and what is next? That is the question that everyone should ask before the excitement of the bike- sharing and before the excitement of ICO.
There are 5,298 active ICOs on the platform according to ICO Bench report. Cryptocurrencies are dying all over the world. While there are many platforms surviving and thriving, a report issued in July of 2018 found that more than 800 of those are essentially dead and no longer able to function at the capacity that they strived for not long ago.
Right now, less than 4 per cent of all ICOs are successful or seem to have a future, despite raising approximately $50 million to $100 million. Fifty-five per cent of so-called initial coin offerings failed to complete in the second quarter of 2018, according to a report from the agency ICO Rating. Most analysts take this to mean that the quality of projects in the market had “significantly worsened.”
Similarities between bike-sharing and ICO
As you can see where I draw the comparison between the ICOs and the bike-sharing businesses here; there is a cemetery of thousands of ICOs just as much as a cemetery of thousands of bicycles. Everyone jumped at the opportunity at a certain period until the excitement quickly dissipated.
Just like how we all thought bike-sharing was disrupting how people commute, ICOs were similar in a sense that we all thought that a new way of fundraising and financing new projects is just about to disrupt the economy. Same way how blockchain enthusiasts and cryptocurrency fans thought that this way of transacting and implementing technology is going to change the world.
Reality check
It did not work that way, and now, what is next? What will happen to all those who invested heavily in ICO, pumping their own money, sometimes invest their life savings into cryptocurrencies and observing them collapsing?
The reality is that 80 per cent of the ICOs were frauds, and 10 per cent lacked substance and failed shortly after raising money. Most of the remaining 10 per cent may likely suffer the same fate as well.
In conclusion
My point of view is that before anyone gets excited about new technology disruptions, we have to be a little skeptical and analyse every detail; from current trends to future consequences of such disruptions. We don’t want to jumpstart projects that only end up in graves after a short period.