1. 70% of tokens are worth less than they were during their ICOs. What does this mean for the industry? There are over 1600 types of cryptocurrencies as of August 2018 ( https://en.wikipedia.org/wiki/List_of_cryptocurrencies). The industry is going to start to consolidate itself to fewer implementations. It is cheap to facilitate blockchains that are existing, but less time will be spent promoting them and fewer developers will attempt to introduce new ones. The industry to watch is the cheap and fast development of integrated circuitry.
2. Why is this? Even people that have a passion for cryptocurrencies would not be able to keep up with so many implementations. Unless you are going to trust someone else to hold your coins, which has historically been a bad idea that people continue to learn, you are going to have to manage a different wallet and possibly download a huge blockchain for each currency. No one is going to do too many of those, especially if you are focused on speculation. I think as the speculators figure this out, they are going to start to go on to other things and the industry will consolidate itself.
3. Does this mean that the ICO/crypto market as a method of fundraising is dead? What does this imply? No, unless by fundraising you mean riding speculative waves of value increases, then again no, but it will be some years before another wave.
4. Is this evidential that ICO-backed projects are generally low in quality, or something else? You can determine if a project is low in quality by the participation of the developers. They always know if the technology is exciting enough to give their valuable time to.
5. How has the ICO market changed over the past year? The ICO market has changed over the past year in that crypto and blockchain type implementations are more part of a larger technology offering than in and of itself. For example, look at Brave (https://brave.com/) browser, the cryptocurrency portion of this project is a means to provide a currency as a reward for participation.
6. Where has the money gone with these tokens? Are companies squandering their funds? It depends on how you define squandering or more specifically on how you value those things that the funds are being spent on. Is development of resources to further expand cryptocurrency capabilities valuable? Is the payment of small amounts of money to speculative participants squandering? This is a difficult question to answer in broad terms.
7. Have investors lost interest in the ICO market? Investors will always go where money is to be made. The faster and less risk the better. There have been and will likely continue to spike in value and when there is, I am sure you will see more investor activity. Lately, cryptocurrencies and blockchain seem to be more of a buzzword to show the value of cutting edginess to investors.
8. Any other comments you might have is greatly appreciated. I believe that this last spike in value has been attributed to international money laundering operations and as governments crack down on this behavior, you will see less and less speculative value from cryptocurrencies.