Are ICOs Helping or Hurting Ethereum?
Mark June 21, 2017 Crypto, News https://themerkle.com/are-icos-helping-or-hurting-ethereum/
Promising and professionally staffed ICO's that sell a compelling service and have real shot at success help ETH pricing and their token sales do indirectly via re-sale on large exchanges. Likely dealing with a 20/80 in the unregulated wild west. Keep holding. Seems like easy money at times, but these are tough competitive environments (with scam artists.)
However, when a project remains in limbo, or the funds get misused, or issues arise with the ICO, the market will be quick to react with a sharp price decline.
Take for example The DAO, Ethereum was surging in value prior to the hack trading at $21. Right after the hack, the whole community was left awestruck and the price dropped over 25% to a low of $15. If this trend of raising millions in capital for brand new projects continues, it will only be a matter of time until something goes awry and investors begin to panic. After all, it takes 100 successful ICOs to keep pushing the price up, and only 1 failed project to bring the ecosystem down.
Furthermore, as these ICOs get more and more popular, when a reputable projects comes around the whole Ethereum network crashes due to the overwhelming activity. The Status, Bancor, and even the SONM ICO are just three of the most recent examples that rendered the blockchain unusable for a period of time. For those not interested in the ICOs, unable to move funds during random times is not a good development by any means.
ICOs are the blockchain Kickstarters. I wouldn't be surprised if most of the projects fail or keep delaying promises.
I dont see why ICOs have to be all on ethereum. There re other good platforms on the rise.
In a year when many fail people will see that they can be scams and it will harm ethereum. After that we'll see how ethereum responds.
That is a good question!