Tuesday was a tough day for cryptocurrencies as the crypto market went into a panic mode. Ethereum plunged 20.7%, hitting a 9-month price low to trade below $300, whereas Bitcoin was down by 6.4% to trade below $6,000.
However, things are now looking promising as major cryptocurrencies recovered on Wednesday. Ethereum has rebounded, recording a 5.71% increase to trade at $284.5. Bitcoin, on the other hand, has also fought back to record a 5.18% increase, and is now trading at $6,330.50.
Ethereum prices dropped following a report that most investors who bought the cryptocurrency to participate in ICOs are now cashing out in order to cover their expenses amid fears that the bear market would continue.
“Most cryptocurrencies have been overvalued for a very long time,” the Chief strategy officer at Blockstream Corp Samson Mow said. It’s hard to pin this move on any particular factor, but it feels like the opposite of last year when money piled in as people felt FOMO. Now it’s piling out as they sense panic.”
Ethereum co-founder Joseph Lubin confident of growth
Meanwhile, the Co-Founder of Ethereum and the chief executive officer of ConsenSys Inc., Joseph Lubin, says that the next cryptocurrency bubble is coming, along with mass adoption. According to him, the current bear market is typical for such an industry.
“This is something we’ve seen so many times in the blockchain ecosystem since 2009 when Bitcoin was invented… We’ve seen six big bubbles, each more epic than the previous one. Each of these bubbles are astonishing when they’re happening. But when you look back they seem like little pimples on a chart, really, because the growth has been exponential,” Lubin told Blomberg.
Lubin sees massive adoption of the Ethereum platform happening because the startup ecosystem is exploding. He sees a future where the Ethereum platform will be major among numerous other protocols built to co-exist. This, he believes, is what it feels “to be living in exponential times.”
Is it time to buy?
During this cryptocurrency market drop, some investors believe that it’s the right time to acquire more coins. It’s better to be buying digital assets while the prices are low rather than when they are on their all-time-highs.
Just like Lubin, many analysts share the opinion that experiencing a huge market drop is typical for an industry like cryptocurrency, and crypto has emerged stronger from each of the previous “bubbles” Lubin talks about. This could mean it’s a good time to buy Ethereum, Bitcoin and other top cryptos while they’re in a dip to take advantage of a price correction. However, the volitility in the crypto market isn’t likely to go away in the near future.