Over the past year, it has been very popular for startup companies to raise funds by doing a so-called ICOs.
Many companies have used the cryptocurrency ethereum’s platform for their ICOs. Using their platform has proven to be a very effective way to raise funds. This is also considered by many to be a reason why the price of ethereum soared so fast last year, Bloomberg reports.
ICOs are to blame
Now, many people are saying that the ICOs are to blame for the sharp fall in the price of ethereum, partly because there are fewer successful ICOs on the platform, but also because several of the ICO projects are said to be selling off large amounts of the ethereum they previously raised.
In August, startup companies have raised $326 million through ICOs. This is a big decline compared with the beginning of the year when companies raised over three billion dollars a month, according to a report from the research firm Autonomous Research, Bloomberg reports.
