Jimmy Song is a popular Bitcoin developer who believes that numerous investors might be about to cash out of their Ethereum investments and he has drawn a link to the crash that Yahoo experienced back in the 90s.
In 1994 and 1995 the tech industry was getting waves of cash flowing into it. During the early days of the internet, investors were very excited and ran to cash in on the buzz but the crash that followed left many of these tech firms with values 90 percent lower than before the plunge.
The Bitcoin developer has compared the rise and fall of the search engine to what Ethereum is currently going through.
“They were part of that whole dot-com bubble, they had a crazy valuation at some point. They were known as a portal and a search engine and they had all these startups that were pouring money into yahoo just to advertise on their front page.”
The hype of the product was beyond their financial output but the huge amount of startups coming onto the scene in the tech world.
“The advertising rates were ridiculously high. What caused the yahoo valuation to be so high was in large part because of those advertising rates. And those advertising rates were only there because there were so many startups trying to get their brand out there.”
As reported by ZyCrypto, Song also noted that the low entry barrier for ICOs. the cost of creating an ERC20 token is very low so ICOs will start to pop up but investors are now backing off projects that aren’t delivering functioning products.
In the end, Song believes that the price of Ethereum will continue to drop and a lot of investors will leave when the bubble bursts.
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