Many people have referred to the current ICO climate as a bubble, a bubble that is growing beyond its actual capacity and will no doubt burst. Here, opinions split, ICO backers are opposed to this idea simply because a burst would see many ICO’s fall. Others however believe that a burst of the ICO bubble will benefit the markets in the long run, clearing up the wealth of ICOs we currently see, making way for more professional, real business ideas taking on an ICO format that could in turn benefit the markets overall.
According to new reports, Head of Binance Labs, Ella Zhang has spoken to Bloomberg stating that the ICO bubble is on the verge of a burst. Whilst Zhang can’t predict when it will happen, she does predict that it will mean great things for the markets overall.
According to Bloomberg, Zhang said:
“We’d like the bubble to break. We still see a lot of hype in the market, valuations are high and unreasonable. We really think if the bubble bursts, it’s a good thing for the industry.”
Moreover, according to Bloomberg:
“Zhang said that while the bull market is positive because it attracts more users, the truly good projects will emerge once the bubble bursts. She’s not making any prediction as to when that will happen. Sales of digital tokens by so-called initial coin offerings have already surpassed the record amount raised in all of 2017, at more than $9 billion.”
See the full report by Bloomberg for yourself, here-
Zhang of course speaks from a position of great authority, although we pust point out that this is really based on speculation, much like the majority of cryptocurrency speculation. If ICO culture really is a bubble, then yes, it will burst eventually but just because it seems to be a bubble, doesn’t mean it is one and thus, it doesn’t mean that ICO culture will collapse. Likewise, regulation may get in the way first, as we know, ICO regulation is a hot topic at the moment, therefore before the culture is able to grow beyond its means, we could see regulation step in and stop ICOs altogether. To be fair, the latter scenario is unlikely, yet still possible.
The take home message here is that ICOs are seeing a changing landscape, and the markets will benefit from them no matter what happens. Hopefully, as the culture grows as will security and regulation, making it harder for people to run false and scam ICOs.