BitMEX CEO Arthur Hayes recently predicted that Ethereum’s ETH token would drop below $100. Hayes also wrote in “Crypto Trader Digest”, BitMEX’s newsletter, that Ether is a “shitcoin” and its price had only been pumped by the massive number of initial coin offerings (ICOs) launched through the Ethereum platform.
Moreover, the BitMEX founder said that many of Ether’s investors were venture capitalists who had been lured in because of the skyrocketing prices of cryptocurrencies in late 2017.
However, now that they’ve seen the crypto market shed over $600 billion since January 2017, many VCs may just decide to dump their Ether and/or ERC-20 tokens because they might not be able to stomach more losses.
“They Don’t Have The Mental Strength To Cut Positions To Limit Further Losses”
Hayes explained:
“The VC investor who has never suffered the vagaries of the market is as green as the noob who thinks he or she can go from 1 to 100 Bitcoin in a few trading days. They don’t have the mental strength to cut positions to limit further losses, or backup the truck and buy opportune dips even though they are down. More importantly, LPs can now see an objective last price for a particular token, and can’t be hoodwinked. They will attempt to be a Monday morning quarterback, and that only adds to the VC investors’ anxiety. At a certain point, they go ‘fuck it’, and dump everything they can.”
Notably, Ether’s (ETH) price had fallen below $300, but has now recovered and is currently trading at $303.55.
While Hayes may have accurately described the mentality of some crypto traders, it now seems unlikely that Ether’s price will fall below $100, or even below $200 – because many more legitimate projects have recently been launched on the Ethereum blockchain.
Many New Ethereum Projects, Development Up “Two Orders Of Magnitude”
In fact, as reported by Crypto Globe, blockchain startup Axoni successfully completed a Goldman Sachs-backed $32 million Series B investment round. The project entails migrating a large legacy financial infrastructure to a more high-end Ethereum-based financial system.
Moreover, Ethereum co-founder Joseph Lubin recently revealed that “more fundamental structure” was being developed for the Ethereum network. Lubin further noted that many speculative traders had been driving the crypto market’s prices, the “types” that “feel like their fortunes are rising and falling” simply from daily price fluctuations.
Lubin explained, however, that volatility in cryptocurrency prices, including the price of Ether, would not affect the growth of crypto ecosystem. Commenting on the digital currency market reaching record level highs in December 2017, the Ethereum co-founder said development activity increased by “two orders of magnitude” due to the rising interest in cryptos.
Lubin also said the crypto market has seen many “bubbles”, and that each of these bubbles is followed by an enormous surge in activity. Notably, recent reports indicate that there has been in dramatic increase in the number of new blockchain developers.
These developments, coupled with Ethereum co-founder Vitalik Buterin’s recent statements that the smart contract platform will scale to handle 1 million transactions per second, make it seem more likely that Ether’s price will stabilize (if not increase), ratther than fall below $100.
