Extreme market price volatility of top digital currencies is nothing new for the ultra-dynamic crypto market. But the Bitcoins losing over 30%, plummeting to $4300 USD in less than a week caught even the seasoned and expert investors by surprise. Amidst the slumping BTC prices, other major cryptocurrencies shared a similar fate as Eth, the highest loser after BTC, crashed to $126 USD on Tuesday, before recovering.
Though some see the market crash as a result of the SEC crackdown on ICOs in the US, experts have ruled out the possibility of the regulatory authority’s ability to impact the global crypto market to such an extent.
In an interview to the Bloomberg TV, Stephen Palley, a blockchain attorney, said: “I’m not sure that there is necessarily any connection between recent SEC activity and the price of cryptocurrencies. It’s difficult for me to see a causal relationship.”
Amidst uncertainty, there have been mixed reactions from experts. While many are predicting a further downward trend for BTC and ETH, top wall street crypto investor TOM LEE is still sticking to his prediction of $15000 price for Bitcoins by the end of 2018.
It is also interesting to see how the market crash impacts the upcoming and ongoing ICOs. With markets crashing even earlier this year many ICOs had a hard time finding investors and several ICOs had to extend or reorganize their ICO launch.
Talking to CCN, Falco Pangkey, co-founder at ICOpicker, a platform connecting ICOs to investors through AI-based matchmaking and marketplace pooling services said – “Bearish crypto markets do impact ICOs, and extreme market volatility demotivates investors. However, it is not always the case, and a lot depends on a project’s merits. We have seen ICOs managing significant investments on our platform during an unexpected market crash earlier this year.”
Despite the uncertainty surrounding the plummeting market prices of major cryptocurrencies, overall ICOs have managed to do a lot better this year. The ICO industry continues to expand significantly, raising over $23 billions in funding in 2018 so far, making them a preferred fundraising option for startups.
Explaining whether the current market crash will impact the ICOs, Falco said – “There are reasons to why certain ICOs struggle with fundraising but crashing cryptocurrency markets isn’t the main reason. If you take a look at the statistics, ICOs have been more successful when earlier this year bitcoin prices were 70% lower than their lifetime best in December 2017.”
Though many ICOs have suffered to crashing prices, a generalized cause and effect relationship between bearish crypto markets and an ICO’s fundraising difficulties is yet unclear. The popular and promising projects like Telegram and EOS successfully raised $5.7 billion together amidst falling Bitcoin prices.