A gauge of global regulatory policies led by the US Securities and Exchange Commission, appeared to be threatening an era of digital currencies, creating fears among the payment companies issuing tokens and the investors, who had been purchasing them, taking the buzz out of the red-hot crypto bulls.
At this standpoint, companies who had issued digital currencies or tokens over the last couple of years through Initial Coin Offering (ICOs) may need to sell more of their assets to grapple with the dwindling crypto operations and financing a crypto operation became much-harder than ever, since the market lacks potential buyers following US Securities and Exchange Commission led supervision on increased oversight of the crypto transactions.
Crypto had a blockbuster riding since their bumper ICOs in 2017 mostly performed through Ethereum, however, during the third quarter of 2018, cryptos started to show weakness, following multiple scandals related to their ICOs, and two of the cryptocurrency issuers had to pay back the ICO amount to settle operations.
Since then, the cryptos nosedived, wiped out almost 80 percent of their market capitalization, which has now been curbed to reside below 120 billion, an industry once hit $800 billion earlier on 2018 out of the blue.
Since the crypto issuers had to sell more of their assets to finance the operations, there had been daedal distress, as crypto market lacks potential buyers and big buyers are keeping themselves at bay in the wake of a crackdown monetary regulations.
Citing a low-liquidity, a co-founder of a crypto data platform in New York, Ryan Selkis, said, “Many people don’t fully understand the impact of new supply on this market particularly when there’s low liquidity.