CEO of Bitmain Jihan Wu: Constitution of ICO "Insufficient financial bubble"



Cryptocurrency, Initial Coin Offerings (ICOs) – Jihan Wu, founder and CEO of the world's largest cryptocurrency mining company, expressed a rather ferocious opinion on the current model of investment in projects of coins.

Speaking in an interview with CoinGeek, Wu had harsh words for Initial Coins Offerings (ICOs), giving his opinion that the model seemed largely unstable and reflected more of the financial danger bubble which is so commonly associated with Bitcoin. In addition, Wu expects the ICO market to implode at some point in the near future, stating that it is "just a matter of time", before the financing model of the new cryptocurrency development went entirely,

"I believe that ICOs are a kind of unsustainable financial bubble, it will eventually break out, it's just a matter of time, I think it's only a year or two, but it will disappear. "

The basis for Wu's argument against the ICOs is not the fault of the cryptocurrency or other coin projects, which is superior to the current model of Wall Street. In fact, Wu envisions a future in which traditional trading assets, such as stocks and bonds, pass to a tokenized platform to la many exchanges of cryptocurrencies. However, ICOs, in contrast to their quasi-kinship with equity IPOs, offer zero protection to investors and will find it difficult to survive government regulation on the way. In addition, ICO investors are not paid in dividends, are entitled to vote per share and may end up investing in currencies that are regulated as securities despite the initial lack of protection.

Wu accuses the unbridled price speculation that has come to characterize the entire cryptocurrency sector as being at the center of the ICO model. Rather than investing in projects and developing currencies that have sustainability in the real world, the typical ICO investor is looking for a quick turnaround, a principle that was confirmed at the start of the year when economists discovered sell in the first two weeks of issuing a best ROI token. The interest is only in profit, rather than creating any form of sustainability in the market. The same greed-based mentality has spread to several development leads, with more than one ICO closing out as a scam after taking investor funds.

Rather than following the ICO route to finance the ongoing development of Bitmain, Wu and his team decided to present a traditional initial public offering (IPO), a move that has been the subject of controversy when it was leaked. company could be a money haemorrhage through an over-extension in Bitcoin Cash. While the cryptocurrency mining conglomerate was able to raise $ 400 million in a previous round of funding, this week produced somewhat bizarre news of investors previously reported to the company that denied any association. Last week Softbank, which holds the distinction of being the biggest investor in Uber, denied the rumors it had invested in Bitmain's IPO. Just yesterday DST Global did the same claim in an anonymous council to Cointelegraph which was subsequently confirmed, referring to previous reports that the company had decided to put money in the IPO. The Chinese multinational that owns Tencent has also launched the hat in denial of denials, issuing a statement to a Hong Kong newspaper that

"the company did not take part in the investment of Bitmain Technologies."

While Wu may be echoing an industry concern for unregulated nature and similar to ICO bubbles, early coin offer projects are booming in 2018, already doubling the volume compared to last year.


Source link