According to the co-founder of Ethereum Joseph Lubin, the current excitement and the frequent launches in Initial Coin Offerings (ICOs) are here to stay.
While speaking with CNBC, Lubin stated that ICOs are here to stay and would fuel the cryptocurrency market in the future as well. Even though there is currently some irrational excitement in the ICO market, he expects this excitement to be present over the next few years as well. The Ethereum blockchain provides a platform which can be used to create decentralized applications powered by its digital currency called Ether. It is the second largest cryptocurrency by market cap.
The total amount of money which various companies have raised from ICOs is around $ 3 billion. This year is one of the biggest when it comes to ICOs. Even though the demand of ICOs is increasing, there have been many regulatory hurdles created by the regulators in South Korea and China.
According to the co-founder of Ethereum, a significant portion of the current IT infrastructure would move over blockchain in the future. The main reason why blockchain is increasing in acceptance is due to the fact that it cannot be easily tampered with. Thus, all the transactions which are conducted are completely secure as well. Moreover, it is decentralized which ensures that a single authority or a regulator does not control it.
A significant number of the ICOs which came out this year are based on the Ethereum platform. Lubin was also of the opinion that ICOs can be launched for a variety of different purposes and can be launched by individuals as well. Participants in ICOs do so with the expectation that tokens would increase in value once the company starts generating profits. Owing to this very reason, he believes that ICOs are here to stay.
With several other ICOs launching in the coming few months, it remains to be seen whether this excitement surrounding ICOs actually remains intact or not. The truth is that most investors are looking for short term gains. It remains to be seen how many of these investors are actually willing to hold the cryptocurrencies when the value of these cryptocurrencies actually falls. Till then, however, cryptocurrencies would keep on attracting newer and newer investors with the help of ICOs. These days, many companies have lined up their unique offerings in order to raise money through ICOs.