The Rollercoaster of Cryptocurrency
Let’s face it; entering the world of cryptocurrencies is like stepping onto an amusement park ride that one can’t quite control. The highs can be exhilarating, the lows, well, less so. Throughout 2017, the cryptocurrency realm experienced price swings that could make even the most seasoned traders feel queasy—think rapid shifts of hundreds of dollars in mere hours! With such volatility, it’s no wonder many token issuers are struggling to keep their promises.
ICOs: The Disappearing Act
It would be simplistic to place all the blame on the industry’s irresponsible players. However, it is quite relatable that the unpredictability in Bitcoin and alternative coins makes it increasingly challenging for new projects. Sometimes these projects pack up and vanish faster than a magician’s rabbit. When ICOs raise significant amounts of capital, even minor fluctuations in crypto value can drastically alter their financial landscape, pushing their lofty objectives to the backseat.
Speculators: The Uninvited Guests
Jeremy Epstein, CEO of Never Stop Marketing, argues there’s more afoot than just bad luck. Speculators without a vested interest in a project’s vision are throwing proverbial wrenches into the ICO works. He notes,
“Most of these ICOs have tremendously benefited from the speculative fever. The thing is, speculators aren’t believers in the mission. They are opportunists.”
In a decentralized scene, cultivating a supportive community is essential—and it’s a tricky marketing challenge when the crowd consists of potential flippreneurs rather than believers.
Skyrocketing Costs of Participation
Interestingly, participating in ICOs isn’t getting any cheaper. The sky-high prices of Bitcoin and Ethereum have increased the cost of entry significantly for potential investors. Much of the innovation in this space is based atop the Ethereum blockchain, which, let’s be honest, has been riding the price wave rather aggressively. Those eyeing involvement in ICOs today must navigate a landscape where token prices are often now ticketed at an astronomical rate.
Fiat: The Smoother Operator
To counteract the tumultuous tides of cryptocurrency volatility, new solutions are rolling in like a fresh breeze. Some blockchain companies are now opting to denominate tokens in more stable fiat currencies. Take Moeda, for instance. They’re putting their tokens in the proverbial safe of US Dollars rather than the unpredictable paths of Bitcoin or Ethereum. As they commented in their press release, soaring crypto values prompted this tactical pivot. By accepting donations directly in fiat currency or cryptocurrencies, they hope to stabilize their investment landscape.
In summary, as the ICO landscape remains awash in unpredictability, it seems that seeking refuge in the steadiness of fiat could be the life raft that many projects need to navigate out of stormy waters—until the crypto waves calm down and everyone can enjoy a leisurely cruise once again.