While currently at the time of reporting, the price of Ethereum has recovered above the $200 USD mark after the recovery of major cryptocurrency Bitcoin to $6,409 USD. Since July, ETH has seen a continuous decline in its price comparatively to other major digital currencies.
Earlier, back in year 2017, Ethereum’s price surpassed the $1,500 USD mark and investors of ERC20 tokens on the Ethereum protocol achieved very profitable returns for their investments.
But, within the past few months, the worth of ERC20 tokens have fallen considerably with the decreasing price of bitcoin. It is however most of the times observed that the volatility in the prices of bitcoin effects the whole crypto ecosystem very adversely.
The majority of experts within the crypto ecosystem have attributed this decline with the excessive sell-off of ERC20 based blockchain projects that initially helped Ethereum to raise Millions and Billions in ETH in their token sales.
As the Ethereum’s price began to fall and thereafter the cryptocurrency market entered a significant downfall, experts aforesaid that ERC20 projects began to sell their ETH holdings, inflicting ETH to expertise an additional intense downtrend comparatively more severe than other cryptocurrencies.
It is however evident that the decision of the company to sell high amounts of ETH in panic mostly contributed to the downtrend of the Ethereum, as seen now a days.
Earlier, Augur co-creator Joey Krug faced many criticisms by several investors with the decision of the Augur team to sell their Ethereum at $0.7 USD to fund the operation of their project. However, If Augur had sold its holdings as Ethereum, since back in 2017, he might have raised billions of money for supporting his operational project.
The massive panic sell of of Ethereum initiated by ICO’s occurred as a result of ICOs thinking to avoid missing out on a rally like Augur did. But, solely is it impossible to predict the hike and downfall of the assets.
Rather than this, the approach of Augur, Xie, and several other projects, investors and associated accelerators to prevent blockchain based projects operating like hedge funds to open source developer communities might prevent such an intense downtrend for Ethereum within the coming future.