Ethereum (ETH) sank down to levels not seen since May 2017, when the cryptocurrency took off significantly for the first time. Now, ETH has retreated back below the $200 range, finally finding some support around the $190 level. During the bull market, ETH was below $200, first in May, then in mid-July 2017, but the price surged after that, touching over $1,400 at its all-time high.
Even Nouriel Roubini, the economist known as Dr. Doom, commented on the gloom, citing Ponzi schemes, casino games, DEX’s no one uses and lack of useful Dapps as the reason Ether’s decline.
ETH crashed below $200 within three hours, between 17:00 and 20:00 UTC on September 8, and continued drifting near the low range. As of 9:00 UTC on September 9, ETH traded at $191.76. The fall is especially dramatic, as ETH wiped out 35% in the past seven trading days. At the start of September, ETH hovered around the $300 range. The dropping price of ETH will have reverberations across the crypto market, as many tokens are traded against ETH and only denominated in ETH prices.
Because ETH is seen as an important commodity, there were even suggestions to turn the asset into a fixed-price stablecoin. However, WhalePanda, Bitcoin proponent, showed his usual skepticism:
Now, ETH prices threaten to also fall below 0.03 BTC, losing more than 50% in BTC denomination in the past three months. While initially ETH was seen as “the Bitcoin killer”, lately the flaws of the network became more apparent. Governance issues and the lack of clarity around the regularly scheduled hard forks, made Ethereum look more centralized.
Yet perhaps the biggest immediate pressure on the ETH price are ICO projects trying to salvage at least some of their initial capital. In the past 30 days, DigixDAO sold 139,400 ETH, one of the biggest liquidations. Other ICOs sold smaller amounts, but the selling added up and put pressure on the market.
The crypto community has noted that ICOs may indeed cause a further drop in ETH prices, due to panic selling. A large part of the fundraising for ICOs happened during months when ETH prices were higher, leaving projects with funds below their expectation. Even the legendary haul of EOS, estimated at $4 billion, is now worth much less.
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