Alexey Andryunin (CoinDesk archives)
Eleven months ago, Alexey Andryunin was sure his business was not long for this world.
A 22-year-old math student from Moscow, Andryunin built a business inflating trade volumes in little-known crypto tokens issued during the 2017 initial coin offering (ICO) craze. In a CoinDesk published last July, Andryunin candidly described the underworld of micro-cap tokens and exchanges surviving on artificial volumes ginned up by paid “market makers” (a used loosely in this context.)
At the time, Andryunin thought his business was heading to a decline: ICOs were moribund, the token market was shrinking and a was about to scour the shadier corners of the crypto space.
He now says he was mistaken. Business is growing again as token promoters pay him to pump their projects so they’ll be accepted on crypto exchanges. It doesn’t hurt that the COVID-19 pandemic has led to a rise in investors looking for the next crypto opportunity.
“We were about to switch to big data analysis, but we didn’t have a moment to start there [because] the crypto market suddenly turned around to us,” he told CoinDesk recently.
In addition to inflating volumes, his firm is providing all kinds of services to token projects. It will code apps when the founders of the projects have nothing but an idea, Andryunin said – for a price.
Previously a two-man shop, Andryunin’s firm, Gotbit, now has a team of seven and a seemingly endless pool of readily available freelancers from the body of math students at Moscow State University, where Andryunin himself is a junior.
He found the CEO life incompatible with his college schedule, though, so he’s thinking of dropping school after this semester. “[Studying] fundamental mathematics and leading a business do not come together well.”
Andryunin’s newfound career shows that long after the ICO craze ended, there are dozens of outfits still raising funds via token sales – and the pandemic has made business lucrative once again for issuers and middlemen.
While the dollar amounts are far smaller than during the go-go days, the token market is active. In just the last 30 days, over 60 new tokens , the popular website recently .
The world of penny tokens and obscure exchanges is still appealing, Andryunin says. In his estimate, each month the market for promoting new tokens generates about 1,000 (roughly $9 million at recent prices) in fees for companies like his.
Sergey Khitrov, founder of Listing.Help, which serves as an intermediary between token projects trying to get listed and exchanges, said demand for such services soared this spring.
“In the times of pandemic, many businesses took a hit, and the companies shifted to making crypto projects, which increased the demand for listings,” Khitrov said. In addition, during the spring many exchanges lowered their listing fees, which also stimulated demand.
About 95% of the tokens created through ICOs are now dead, he estimated, with their value up to 70 times smaller than at their peak in 2017. Nevertheless, some people still want to play the token game.