Cryptocurrency
Gas Ain’t Gold: Why Ether’s Price Could Tank Even If Ethereum Succeeds via @coindesk
As reported by Coindesk, “The virtuous circle that saw buyers of ethereum-based ERC-20 tokens drive ether’s price above $1,400 mid-January has morphed into its diametric opposite. “The initial coin offering boom has fizzled and the price has sunk to just above $200. “This new phase, a vicious cycle downturn that has exposed the ether market’s intrinsic connection […]
As reported by Coindesk, “The virtuous circle that saw buyers of ethereum-based ERC-20 tokens drive ether’s price above $1,400 mid-January has morphed into its diametric opposite.
“The initial coin offering boom has fizzled and the price has sunk to just above $200.
“This new phase, a vicious cycle downturn that has exposed the ether market’s intrinsic connection to the ICO boom and bust, is of course painful for anyone who bought ether in the last 12 months.
“But in the spirit of encouraging the crypto community to embrace failure as a real-world source of learning and growth, the experience is also incredibly informative for understanding how value is formed and lost in crypto assets attached to blockchain platforms.
“This dynamic is still being figured out. However, a strong hypothesis is emerging that the correlation between the price of a token such as ether and its actual or expected network utility —that’s is, its value as the ‘fuel’ in a blockchain ecosystem — might not be very strong.”