We’re Waiting for ICO Bubble to Pop: Head of Binance’s $1 Billion VC Fund

By June 5, 2018 ICO
Click here to view original web page at www.ccn.com
ICO bubble Binance
Advertisement

Get exclusive analysis and cryptocurrency insights on Hacked.com for just $39 per month.

The head of Binance’s recently-launched $1 billion venture fund says that the company believes the initial coin offering (ICO) market is in a bubble and is hoping that it will pop soon for the health of the wider blockchain industry.

Ella Zhang, whose official title is Head of Binance Labs, told Bloomberg that while the bull market — at least as far as ICOs are concerned — helps attract more interest, it also results in unreasonable valuations.

“We’d like the bubble to break,” said Zhang, who formally joined Binance in May. “We still see a lot of hype in the market, valuations are high and unreasonable. We really think if the bubble bursts, it’s a good thing for the industry.”

As CCN reported, ICOs have already raised more money — at least $9 billion — in 2018 than all of 2017, even as regulators have ramped up their scrutiny of this booming industry and consumer interest in cryptocurrency has declined considerably.

EOS creator Block.one raised more than $4 billion in a crowdsale that concluded last week, while chat app Telegram raised $1.7 billion in a private sale that was restricted to fewer than 200 investors.

Zhang’s comments are notable, particularly given the fact that Binance itself held an ICO last year. More recently, Binance CEO Changpeng Zhao authored a blog post in which he argued that an ICO is a vastly more effective way to raise capital versus traditional venture fundraising.

Despite concerns over an ICO bubble, Zhang revealed that Binance Labs has already made direct investments in four projects and said that the firm has no qualms about investing directly in both company equity and crypto tokens.

Zhang said that Binance, which operates what is currently the world’s highest volume cryptocurrency exchange, plans to develop a new program — called “Community Governance Initiatives” (CGI) — to help the company weed out and delist scams and other projects that do not live up to their promises.

“The main purpose of this is to fight scams and sh-t coins, and to boost crypto and blockchain technology,” she explained.

Featured Image from Shutterstock

Follow us on Telegram.

Advertisement

The head of Binance’s recently-launched $1 billion venture fund says that the company believes the […]

Leave a Reply