In the heat of the 2017 Initial Coin Offering (ICO) boom, crypto projects were launching daily, raising billions with little more than a whitepaper and a promise. But while the crowd was cheering, two of the industry’s biggest names—Ripple CEO Brad Garlinghouse and Ethereum co-founder Joseph Lubin—were raising red flags.
Both Garlinghouse and Lubin made it clear: the ICO space was spinning out of control, filled with empty promises, legal risks, and outright scams. Their warnings, bold at the time, now seem almost prophetic.
Ripple’s Brad Garlinghouse: “99% Will Go to Zero”
Speaking at a fintech event in Singapore, Brad Garlinghouse didn’t hold back. He warned that 99% of the cryptocurrencies being launched were likely to fail, adding that many ICOs were legally risky and lacked real utility.
“I think in some ways the ICO boom wasn’t particularly great for crypto… 99% of crypto projects will probably go to zero.”
— Brad Garlinghouse, Ripple CEO
(Source: Fortune)
He even joked that lawyers were “licking their chops” watching the ICO gold rush unfold—suggesting that many startups would eventually face regulatory scrutiny. Garlinghouse used Ripple’s own approach as an example, highlighting that Ripple never held an ICO and instead focused on building real products and partnerships.
👉 Learn more about Ripple’s position on regulation.
Ethereum’s Joseph Lubin: Too Many “Copy-Paste” Projects
Joseph Lubin, who helped launch Ethereum and later founded ConsenSys, voiced similar concerns. He criticized the flood of low-effort ICOs that seemed more interested in hype than in delivering value.
“There have been a lot of copy-paste projects... Most will not make it.”
— Joseph Lubin, Ethereum Co-Founder
(Source: CNBC)Lubin supported China’s temporary ban on ICOs in 2017, saying it gave regulators time to evaluate risks and bring oversight to the space. He also called for milestone-based funding, suggesting that projects should receive investor money only as they hit meaningful development goals.
👉 Read ConsenSys’ thoughts on crypto project standards.
Regulation Was Inevitable—and Necessary
Both leaders agreed: if it looks like a security, it should be regulated like one. Garlinghouse referenced the SEC’s growing involvement in clamping down on fraudulent ICOs, saying it was good for the long-term credibility of crypto.
“If it walks like a duck and quacks like a duck, the SEC is going to say it’s a duck.”
— Brad Garlinghouse
(Source: TechCrunch)Since then, the SEC has gone after dozens of token offerings—including Telegram’s TON, Kik’s Kin, and EOS—for offering unregistered securities. These enforcement actions validated the concerns Garlinghouse and Lubin expressed years ago.
The Impact in 2025: From Speculation to Substance
Fast forward to 2025, and the landscape has shifted dramatically. The ICO era is largely over, replaced by more structured fundraising models like:
- Regulation-compliant STOs (Security Token Offerings)
- VC-backed token launches with longer vesting periods
- Milestone-based DAO funding
- On-chain proof-of-progress models
Startups are now more focused on building real-world utility before raising funds. Thanks to increased scrutiny, regulatory frameworks in the U.S., EU, and Asia are clearer, making it easier to distinguish between legitimate projects and pump-and-dump schemes.
Investors, too, have become more selective. The “buy any token and hope for the best” mentality is gone. Tools like TokenInsight and Messari have empowered users with real research and transparency.
Even Ethereum’s ecosystem has evolved. The rise of Layer-2s, DeFi infrastructure, and real-world asset tokenization shows how far the space has come from the ICO Wild West.
And Ripple? It continues to push for regulatory clarity and cross-border payments innovation, even amid ongoing legal battles with the SEC. Its early stance on not holding an ICO now looks wise in retrospect.
What It Means for Investors and Founders Today
For investors:
- Avoid pre-product token sales without transparent teams and legal structure
- Stick to regulated platforms and tokens with long-term backing
- Look for proof of use—not just hype
For founders:
- You need a legal team from Day 1
- Don’t raise just because you can—build first, prove, then grow
- Regulation is no longer optional; compliance is part of product-market fit
Final Thoughts: The Hype is Over—Now Comes the Real Work
Brad Garlinghouse and Joseph Lubin weren’t just being pessimistic—they were trying to protect the space they helped build. Their warnings in 2017 helped steer the conversation toward accountability and value creation.
Now, as Web3, DeFi, and real-world crypto use cases take shape in 2025, those early calls for maturity and caution are more relevant than ever.
If you’re building or investing in crypto today, remember: hype fades, but fundamentals last.
