This Token Project Offered to Shut Down. Its Market Cap Shot Up $10M

The oldest ICOs have treasuries worth more than their tokens' market capitalizations.

Digix CEO Kai Cheng Chng wrote on the DigixDAO blog that Digix has received a lot of feedback since its early-2016 token sale.

"One recurring comment was for a mechanism for dissatisfied DGD token holders to make a clean break from DigixDAO," he wrote.

The post detailed an approach the organization would take henceforth: Token holders will now be able to vote on keeping the DAO's ETH treasury intact.

In response, the token price nearly doubled since the announcement came out on Nov. 29.

Digix is a project that holds physical gold and represents it with tokens on the ethereum blockchain via its DGX token.

The governance token relevant here is DGD, and its current market cap of $39.1 million is significantly below what the 386,000 ETH Chng wrote that DigixDAO has in its treasury.

DGD raised 466,648 ETH in the token sale in March 2016, according to Smith + Crown.

"ICOs are not really keen on buying back the tokens with their treasury holdings since they raise money to develop, not speculate on the token price," Li said.

Zurrer told CoinDesk that the projects best suited to go to their holders to discuss unloading some of their capital are the ones that both have valuable treasuries and a decent token governance model.