Ethereum Prices (ETH/USD) Tank as ICO Bubble Fears Grow
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Ethereum (ETH/USD) Tanks as ICO Bubble Fears Grow

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Ethereum (ETH/USD) Tanks as ICO Bubble Fears Grow

Introduction

This article was posted on Wednesday, 14:26, UTC.

Ethereum fell to one-month lows on Wednesday, as concerns over an ICO bubble brought negative attention to the world’s No. 2 cryptocurrency.

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ETH/USD Price Analysis

The ether-U.S. dollar (ETH/USD) exchange rate has been on the back foot for nearly two weeks after a rally failed to lift prices above $400.00. The rally attempt, which concluded Sept. 1, formed a double-top with the June 11 high.

Ether prices are down more than 6% on Wednesday. Prices bottomed at $269.72 before consolidating in the mid-$275.00 region.

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One thing ethereum has demonstrated over its short history is that, the longer the consolidation period, the bigger the eventual breakout. The market has been consolidating for over a month, a sign that prices could be poised to break higher in the short term.

Analysts are eyeing a potential breakout at the Sept. 18 Byzantium Testnet launch, which is a precursor to the token’s Metropolis update. Ethereum’s next upgrade is expected to be lighter, faster and even more secure. These are all things to be very excited about.

ICO Bubble Brewing?

Ethereum founder Vitalik Buterin caught markets by surprise this week when he declared that the market for initial coin offerings (ICOs) is “in a bubble.” In Buterin’s view, the upsurge in large scale token sales is unsustainable and will lead to many failed ICO projects. While ICOs are a powerful tool for open source startups, Buterin says they’ve growth too big, too fast.

The ether platform has been essential to the growth of the ICO crowdsale. Practically unheard of last year, coin offerings have already outpaced early stage venture capital. The trend appears to be intensifying as more startups go the ICO route.

In Buterin’s view, many firms are issuing a coin not because it makes sense to do so, but because they have a product they can sell quickly. “Without a coin there is no business model,” he said, according to Finance Magnates.

Crypto Market Cap Falls Below $140 Billion

The total value of all cryptocurrencies has fallen below $140 billion, according to CoinMarketCap. The market peaked near $179 billion less than two weeks ago.

Bitcoin continues to hold onto top spot with a valuation of roughly $66 billion. The BTC/USD exchange rate fell nearly 5% on Wednesday to $3,972.00.

Bitcoin Cash retains the No. 3 spot with a total value of $8.1 billion. Eight other digital currencies are valued at $1 billion or more.

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Sam Bourgi

Sam Bourgi

Sam Bourgi is Contributing Writer to Hacked.com, where he specializes in cryptocurrency, economics and the broader financial markets. Sam has nearly eight years of progressive experience as an analyst, writer and financial market commentator where he has contributed to the world's foremost newscasts.

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