Ethereum: for the founder of the project, the bubble is real
Questioned by the Israeli media, Vitalik Buterin spoke about the recent popularity of the ICO. According to the founder of the Ethereum project, the current enthusiasm will not last long and the ecosystem will eventually have to regulate itself.
picture source :https://goo.gl/images/eXDvLP
Initial Coin Offering (ICO) has the coast in recent months. This mechanism has been popularized within the Ethereum ecosystem and today represents an alternative to traditional fund raising for start-ups operating in the world of blockchain technologies. This technique allows a start-up to put on sale "tokens" having different properties and functions. Users who wish to support the project can buy and sell these tokens and thus finance the development of the company that issued them, or speculate on the rise or loss of value of these tokens.
picture source :https://goo.gl/images/qXJ4ui
The real value of these different tokens is generally hypothetical and is often based on the promises of the issuing company alone, which relies on the money thus raised to finance its project. This mechanism has become extremely popular, as it has allowed many companies to raise substantial sums.
But for the founder of Ethereum, Vitalik Buterin, the ecosystem is now "in full bubble" and the return of stick risks to do damage. Buterin's remarks are reported by the Finance Magnates website, which captures information obtained by the Israeli daily TheMarker. According to him, the current popularity of the ICO will lead the market to question itself in the face of the profusion of new tokens issued by companies whose project is not always obvious.
ICO but not too
"It would be a mistake to underestimate the usefulness of ICOs or to say that they are harmful. ICOs are interesting because they make it easy to finance open source projects, which is usually not obvious. I created Ethereum through an ICO. What we see today are people pushing this concept too far and some projects are making tokens, not because it makes sense, but because it allows them to have a product to sell, "he said.
The founder explains that this phenomenon of bubble is not surprising in a sector of the cryptomata still very young. He expects that many projects will collapse as investors develop tools and methods to better identify sustainable projects and differentiate them from those that fail. But the Russo-Canadian is aware of the risk this may represent for Ethereum as a whole: "If too many ICOs fail, this poses a risk for Ethereum. We must avoid putting too much emphasis on these projects. "
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Excellent post, very well articulated. Your articles are always helpful - thank you so much. I'll have to retain this in my brains memory banks.:)