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Crypto News-It

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gabelau

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crypto news

Q:Is it a good idea to invest in Bitcoin 2020?

Q:Is it a good idea to buy Bitcoin right now?

Q:Is crypto a good investment 2020?

Q:What will Bitcoins be worth in 2020?

Q:Will the crypto market recover?

https://www.crowdfundingbuzz.it/perche-le-criptovalute-sono-crollate-e-perche-il-
mercato-tornera-a-crescere/
Fabio Pezzotti, CEO of Iconium, an Italian company that invests in blockchain
projects and digital assets, shares a lucid analysis of crypto markets and why one
can be optimistic

In 2017 and, in particular, in the fourth quarter many investors – especially in

Asia and the US – started buying Bitcoin (BTC) and Ethereum (ETH) in order to
exchange them for specific ICO tokens on which they wanted to invest. In fact, the
only way to participate in IOos was to 'send' the main cryptocurrencies to the
project promoters. The owners of Bitcoin and Ethereum did not want to sell. They
saw the price rise steadily, so why would they sell? They "believed" in Bitcoin and
Ethereum. So, in a "world of supply and demand," the price has soared.

In a second phase, starting at the beginning of the year, the startups that had
completed their IOs became many and held billions in Ether and Bitcoin, and began
selling their tokens, thus reversing the dynamics of the huge demand for Bitcoin
and Ethereum. After the new year's hangover faded, startups had to sell the cryptos
they own with Fiat currency to pay engineers and develop their startups.

And then the panic started. Many IOs could not change their crypto to Fiat currency
as they could not find counterparties and the banks, afraid of possible problems
with the Authorities, did not even open current accounts to companies that had made
ICO. Pressure from U.S. regulators in the third quarter and fourth quarter of 2017
caused a near-total slowdown and shutdown of YOs, at least in the US (private U.S.
citizens are now prohibited from participating in ICO). In addition, many YOs have
started accepting fiat currencies without the need to go through Ethereum, greatly
reducing the need and need to buy Ether to participate in ICO.

Something else happened in 2018. It became clear to everyone that all these IOCs
had not gone through a due diligence process from tech-savvy professional
investors, business angels or VC: so some of these projects turned out to be scams
(NdR: scams) and many more were unfeasible. I would remind you, however, that in
the Venture Capital industry and for seed investments the success rate is not more
than 10%: 90% of the startups financed fail within 3 years of launch. But the
crypto market has allowed the 'listing' (listing on exchanges, such as Binance,
Bitfinex, Huobi, and another 200 or so, scattered around the world) of startups,
thus creating enormous volatility compared to the traditional world of startups
(not being listed, traditional startups do not suffer daily fluctuations in their
value).

The crypto market is extremely related: demand for Bitcoin and Ethereum has
declined, so prices have fallen. The tokens of much smaller startups, with a
capitalization of a few million, have collapsed much more than proportionally. A
natural selection process is underway, at an accelerated rate compared to that of
digital startups funded in the past. Few of these startups will survive: some are
likely to be hugely successful.

In 2017, 80% of token investments were made by retail investors (private

individuals) and only 20% by professional investors (VC, institutional funds,
investment holding companies). Today, 80% of investors are 'professional' if not
more so. Many 'Token sales' take place only in 'Private Rooms' that are not
accessible to the public, and do not make an ICO (online offer of tokens to
individuals). We have created Iconium Blockchain Ventures precisely by predicting
this trend and expecting an indispensable 'professionalization' of the ICO world
and in general for the financing of startups in the blockchain field: on the other
hand, I hope that the public and private individuals will not be completely
excluded from this epochal opportunity. But there is a need for professional
investors (Lead Investors) who first valid opportunities by conducting due
diligence at an in-depth level.

In this sense there are similarities with equity crowdfunding, where for example,
in Italy, a professional investor is required to close a round. The radical
difference from equity crowdfunding lies in the fact that thanks to smart contracts
and exchanges:

A) It is possible to bring in a huge number of people at a much lower cost to the

broadcaster

B) These projects still provide for a short/medium-term quotation (6\12 months) and
therefore generate the possibility of liquidating their investment in a relatively
short time (many forget that the 'seed' investment in startups today, not only will
never see an exit, but in case the genre, takes place on average over 6\10 years: a
time horizon undoubtedly not suitable for private individuals)

It is therefore time for experienced investors, whether they are traditional VCs
(Pantera Capital, Union Square Ventures), or more innovative models where the VC
itself is tokenized (Polychain, Spice VC), or hybrid models, such as ICONIUM
S.p.A., an innovative start-up, which can act both as an investor and incubator, as
well as promoter, advisor and co-founder of 'Token Sale' projects. All with a view
to managing and allocating funds in a diversified and balanced portfolio to better
manage the risk of its shareholders.

Security Tokens are then being born as opposed to the utility tokens used so far.
These will open a new market in real estate but also in the sharing of equity of
start-up companies in the blockchain world. We are also seeing a return to fair
market valuations.

The new companies to be financed in 2019 – and which will be listed in 2019, 2020
and 2021 – will on average be much better than those of 2017 (with the necessary
exceptions, as I expect that even among those financed in 2017 will be born
'unicorns'), with consequent recovery of the market.

The market as a whole will recover because, while prices have collapsed, the eco-
system has become increasingly large and pervasive during 2018: hundreds of
thousands of people around the world are working to solve problems such as
scalability, security, the speed of blockchains. Bitcoin itself is resilient, a
fact demonstrated by its survival to many negative events like Mr. Gox and numerous
up-and-down cycles. The long-term curve for Bitcoin has been positive for over 10
years, and while it has experienced even worse crises than the current one it has
risen ever stronger.

The good news is that many of the 2600 startups – which should never have been
funded – listed in Token will disappear over the next few months. The disappearance
of these tokens that have no reason to exist will push the market upwards.

I also predict that in 2019 we will see some "Killer Apps" take off and generate
mass adoption, which will bring mainstream users into the crypto world and — in a
related world — this will take off the entire market. But this is already happening
in a certain sense, particularly in the world of finance: the most innovative
fintech companies, from Revolut, to Abra, to Transferwise, are launching new
services and applications that allow their customers to immediately use
cryptocurrencies (invest, use them for online and off-line purchases).

Not forgetting the launch of stable coins linked to reference currencies (crypto-
dollar, crypto-euro, crypto-yuan, etc.)but freely usable anywhere in the world,
which do not suffer the fluctuations of classic cryptocurrencies and that therefore
open a completely new and potentially gigantic way of use for payments,
remittances, and international trade.

I therefore believe that the market will see a big rally in the near future and a
long-term upward trend.