REUTERS/Kim Hong-Ji

• ICORating found many companies that raised money by issuing their own cryptocurrencies last year are being "intentionally non-transparent."

• Analysis done for Business Insider found projects are taking their product roadmaps offline.

• Some have also yet to launch any version of their product — but, surprisingly, the best investment returns come from those with no product.

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LONDON — Startups that raised hundreds of millions of dollars last year issuing their own digital coins are being "intentionally non-transparent" with their investors, according to a new report.

Analysis carried out by ICORating for Business Insider found that many projects are operating in an "opaque" manner, with investors left in the dark about how the project is progressing.

Cryptocurrencies exploded in popularity last year thanks to a surge in the price of bitcoin at the end of 2017. It coincided with a boom in so-called initial coin offerings (ICOs), where startups issue their own cryptocurrency in exchange for money to build their business. 435 projects raised $5.6 billion last year, according to TokenData.

ICORating, which provides analysis of potential ICO investments for investors, looked at the progress of the top 50 ICOs from the first half of 2017 for BI. The projects examined raised a combined $887 million and the biggest project, Bancor, raised $153 million.

ICORating said in its report: "The projects reviewed have not publicly revealed how they are spending the funds they have raised. To a certain extent, this is an issue for the whole market, and we are expecting changes in this field."

John Slyusarev, CMO of ICORating, told Business Insider: "The key problem for the post-ICO market currently is a lack of transparency."

Roadmaps taken offline

ICORating found that many white papers — the planning documents used to attract investors — and product roadmaps have been taken offline.

"In general, the projects are intentionally non-transparent when it comes to fulfilling promises made to their investors," ICORating said. "13 projects have removed the version of their white paper presented during the ICO from the token sale website. The same is true for roadmaps."

ICORating declined to name the projects when asked by Business Insider.

Slyusarev said: "White papers often include development plans and deadlines. If a project takes a white paper offline and does not inform investors, this might mean that initial deadlines were unrealistic.