Saturday, June 23, 2018

The cryptocurrency market appears to have reached the point similar to the end of the Dot Com bubble era

At the tail end of the now famous Dot Com bubble, company IPO's were being gobbled up at a record pace, with investors over-inflating the values of these businesses despite the fact they had no track records, profits, or viable products.  Yet of all the different asset classes and sectors created since that time, the one that stands out as eerily similar of course is that of cryptocurrencies.

The cryptocurrency market emerged in 2009 following the aftermath of the 2008 Finance Crisis, but the sector really didn't gain serious headway until the Fed had been deep into their monetary expansion policies, similar to what Alan Greenspan did under the Clinton Administration which led to the tech boom.  And 2017 saw not only a parabolic rise in Bitcoin and most cryptocurrencies, but the number of ICO's that emerged more than doubled the total amount of differing tokens in just 12 months.

And while 2018 has seen a retracement of the total market cap of all cryptocurrencies by nearly 70%, it has not stopped the implementation of new crypto's onto the market, which according to analysts are still being bought, and at prices much higher than their actual values.

Initial coin offerings (ICOs) continue to overflow the crypto universe, but bitcoin bull Brian Kelly told CNBC that the market is overvalued. 
He said investors are in a "wait-and-see mode." 
"People are starting to say, 'I'm going to put the brakes on the ICOs right now. I've got my portfolio. I don't need a seventh or eighth ICO,'" the cryptocurrency investor said on 
"Fast Money" Thursday. "To me, [ICOs are] not as hot as they used to be."
In fact, Kelly said the market for ICOs, or initial coin offerings, a crowdfunding way to raise funds for cryptocurrency ventures, is "very frothy." 
There have been more than 300 ICOs launched in the first half of 2018 — nearly the same amount as all of 2017. And to date, in the first six months of this year, more money has been raised. - CNBC

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