ICOs saw a boom in the market in the year 2017 and the beginning of this year. The surge drew a lot of attention from major market players including the mainstream media. The rise of the ICOs was one of the reasons for the glorious days of the Ethereum [ETH] platform.
Ethereum, the second biggest cryptocurrency in the market at present, became the smart contract which led to the rise of several projects. This includes EOS and Tron [TRX] which have now launched their own MainNet with the aim of surpassing Ethereum.
However, along with the advantage of being the first mover and preferred smart contract platform by the developers, it has its own disadvantages. The bear’s grip which has taken a toll on the whole market has had an adverse effect on Ethereum, especially.
Ethereum [ETH] has seen a constant drop this year, with the price looming below the $200 mark. The dip in ETH’s value turned out to be the most shocking outcome in the cryptocurrency space. Reports have emerged that the price taking the downward slope was because of the ICOs.
Some projects which have raised millions of tokens in the market through Initial Coin Offerings have started to shill in the market, according to reports. The main reason is believed to be either the effect of the bearish market or the failure of their projects.
Moreover, it has been pointed out that almost $30 million worth of Ethereum was sold during the past few days in the market, by Kevin Rooke, a Twitterati. He tweeted:
“ICOs have spent over $30 million worth of ETH this week (153,500 ETH). This is more than any week since March 2018. The scary part? These ICOs still have over $600,000,000 worth of treasury ETH in their accounts (3,000,000+ ETH). Will they sell? Will they hold?”
This could have resulted in Ethereum plunging below the $200 mark and the reason it was amongst one of the coins which were affected the most in this bearish market.
According to CoinMarketCap, at press time, Ethereum [ETH] was trading at $194 with a market cap of $19.86 billion. The coin has seen a significant dip of more than 32% in the past 7 days.
El Novato, a Twitterati said:
“Of course they will sell. What will they do HODLING? They have to buy their Lambo’s, Islands and plan retirement packages..”
CryptoBitfolio, another Twitterati said:
“There is still a lot of selling to happen… And we haven’t seen the bottom yet this year”
Nuno Bispo, a cryptocurrency investor and trader said:
“Talking about selling your crypto low… No wonder! It’s not their own invested money in the first place..”
In addition, recently over $5.5 million was transferred to Bitfinex wallet from one of the genesis blocks. This was around 93,750 ETH and the transfer did not show any significant impact on the price of Ethereum at the time of transfer.
Subscribe to AMBCrypto’s Newsletter
Bitcoin: Would you rather HODL Bitcoin or trade? ex-CTO of Coinbase opines on investing in cryptos
With the inception of Bitcoin and the advent of altcoins, there has never been a good chance to make quick money by simply investing. The last time such an opportunity was seen during the DotCom bubble. However, scams are also a part of this opportunity which became more than evident during the ICO frenzy of 2017.
Millions, if not billions were lost to the ICO scams, which caused the regulatory bodies like SEC, CFTC, and others to step in to protect investors. As the space matured over time, so did the actual number of projects in the ecosystem; there are more than 3000 cryptocurrencies with different and implied use-cases, which is confusing to most of people in the crypto industry and to the people outside of this space as well.
The ex-CTO of Coinbase, Balaji Srinivasan tweeted in support of the above; how an investor who is not familiar with the crypto space should go about investing. Srinivasan said that there were a few people who can be profitable and can beat the market, however, he added that “buying BTC in crypto” was like “buying vanguard in traditional equities”.
Investing in traditional assets or Bitcoin, for people who are inexperienced should be a longterm investment, hence the best thing to do with Bitcoin is to stack and/or HODL.
The DotCom bubble pushed the innovation to its maximum which led to the birth of massive companies like Google, Amazon, Uber, etc. The same can be said for Bitcoin, which led to the development of Ethereum [ETH], which is the second largest cryptocurrency in terms of market cap. However, Ethereum brought smart contracts to the world, which has further led to the development of dApps and other use-cases.
1) ETH is/was also both a phenomenal investment and a major technological breakthrough.
2) Some other digital assets are very promising; I don’t believe innovation ends with BTC and ETH.
But for the person outside the space who wants exposure, just buy BTC.
— Balaji S. Srinivasan (@balajis) June 22, 2019
The bottom line with the Srinivasn’s tweet thread for the people who are inexperienced with crypto space was to just buy Bitcoins and hold it rather than trading it.
A Twitter user @mskvsk, reflected Srinivasn’s tweet as he replied:
“Buying BTC, dollar-cost averaging, forgetting about it for several years. This is the soundest strategy for most people. #stackingsats”
Subscribe to AMBCrypto’s Newsletter