Did EOS Cause The Market To Crash?
Is EOS causing the market to dump?
What are the facts?
- In its 350 day ICO, EOS has raised over 6,000,000 ETH . At Ether prices at $500 each, EOS has raised over $3 billion worth of Ether.
This reddit post by u/TraderJoeSmo helped uncover some other facts:
- Large sums of Ether have left the EOS wallet.
- Only 247,130 Ethers remain in the EOSCrowdsale wallet.
- There is still over 766,437 Ethers in an EOS-Owner wallet.
- Ethereum dropped from 570 to 492 (13.7%) in a 2 hour span on Bitfinex on May 28th.
It is hard to directly say that EOS sold their Ethers and is suppressing the price of Ether.
On March 18th, it looked like EOS may have sold some Ether on the market, which would have had an adverse effect on Ether’s price.
On March 18th, EOS moved 417k Ether and 163k ETH ended up on Bitfinex.
Would EOS want to sabotage EOS?
EOS could potentially want to drop the price of ETH and use ETH to spam the ETH network, making it practically unusable.
This sounds reasonable from a competitor playing hardball, but would EOS really want to intentionally tank the price of Ether? Note that EOS owns hundreds of thousands of Ether, so EOS has an investing interest in the price of ETH.
Also, note that EOS markets itself as a faster, cheaper Ethereum. If EOS’s project succeeds, it should not have to sabotage the Ethereum blockchain. The market should be able to migrate to EOS without an intentional attack on Ethereum.
Looking at the facts, EOS did raise millions of Ethers with the intent to crowdfund their project. Why would they need over a billion dollars to fund their project? Maybe they did not need that much money, but they wanted everybody to have fair access to their ICO. Even if they did not originally intend to harm Ethereum, EOS can only get value from their ICO by selling Ether
The real problem is not EOS, it is ICOs
The real problem at hand is not EOS’s intentions, it is the problem with ICOs. At this point, EOS could have always had positive intent to Ethereum but dropped the price of Ether by selling Ethers accumulated through an Ethereum ICO. If you look at Sanbase, you can see many ICOs with thousands of Ethers. They all have the capability to place market sell orders for their Ethers at any time. This is a problem with large ICOs. EOS raised over 6,000,000 Ethers – that is over 6% of all of Ethereum’s total supply. Is that a decentralized market?