Welcome to the 12th edition of crypto roundup brought to you by HEAT Crypto.
ICOs: The Winter is Coming
Remember the time when every major ICO you could think of was able to raise millions of dollars in minutes. Literally - it took First Blood around 15 minutes to sell out, and not to be outdone, SingularDTV took around 10 minutes to complete. First Blood raised $5.5 million, and SingularDTV raised $7.5 million.
That was so September though. This is October. Seems like winter is coming.
The hottest ICOs of last month are trading down significantly. Even Augur, one of the most high-profile Ethereum projects out there has seen a sharp fall since our last edition 2 weeks ago. Well, the mothership Ethereum itself has fallen.
Take SingularDTV for instance. It is Consensys' first project. For those unaware of Consensys, they are the guys behind Ethereum's Devcon, and have over a 100 Ethereum developers working on all sorts of projects. You'd imagine their first ICO would be a giant hit. That was probably behind the expectations of $7.5 million raise in 10 minutes. But in crypto-land, God help you if you enter the bear market. Here's SingularDTV's price so far:
Not impressive huh? The current market capitalization is below $6.5 million. Ouch.
This isn't an isolated case of course. Take ICONOMI, another Ethereum-based token, which raised the most of any Ethereum token this recent ICO season - over $10 million. It was released last week. How did it do? Not good.
Already below its ICO in both dollar and Bitcoin terms. Ouch again.
The point is, crypto markets are volatile, and we all know that. But sometimes people forget the second-order effect - the markets have highly volatile volatility! This is important to keep in mind, because markets move in clusters, and patterns. Just because you raised money in a bull market doesn't mean your token will trade in one. ICONOMI raised in a bull market, but trades in a bear market. Not unusual.
Investors in ICOs therefore need to be very clear on their time horizons. Are you willing to hold for the long term, at least 1-2 years? If so, the criteria are different from if you're willing to hold only for 1-2 months. This is especially so in the crypto world where daily price fluctuations can be higher than yearly price fluctuations in the stock market.
Z-Cash - the 800 Pound Gorilla
Just to keep investors on their toes, Z-cash is going crazy. Almost literally this time. It has the same supply as Bitcoin (21 million in all) but even after a day, is trading at around 8 Bitcoin per ZEC. This is unheard of. We knew zcash will be hyped at launch, but this is extreme even by crypto standards.
After its launch, zcash was trading at over $400,000 per ZEC!
That's right, the notional is $8.4 trillion. Who are the people buying at this price? If their goal is anything but speculation or selling to the 'greater fool', they are deluded.
But wait, did it end there? Of course not! Here's the saga as it continues -
That's right - the price of 1 ZEC was over $2 million. Here's that scary chart from Poloniex:
That's right, the high is nearly 3300 BTC! As I said, unheard of even in this crazy crypto world. The worst thing is, the volume isn't insignificant either.
On the topic of anonymity and zcash, there is Komodo's ICO that is going on, with the same algorithm as zcash (zsnarks) and with a 'delayed proof of work' concept wherein the blockchain derives its security ultimately from Bitcoin. We'll need to wait and see if this becomes something, but traders who trade 'groups', keep an eye out. Anonymity might be the 'next big thing'. Or not. We hate to make such predictions especially after looking at the graph above.