On Sept. 12, Ethereum (ETH) dipped below the $170 mark, dropping to $166 to hit its lowest point of the year.
Since then, within a 30-day period, ETH has shown promising recovery in its volume and momentum, rebounding from $166 to $230. Last week, on Sept. 23, the Ethereum price achieved $255.
Worst Part of the Drop is Over
The unexpectedly rapid growth of the initial coin offering (ICO) market in mid-2017 led many analysts to speculate that the price drop of ETH was largely triggered by the sell-off of Ethereum holdings by blockchain projects that have raised millions of dollars through public token sales.
Diar, a cryptocurrency research group, revealed in its weekly report that ICOs still hold more than 38 percent of the amount raised in their token sales. At the time, based on the findings of Diar, analysts speculated that if ICOs decide to liquidate their remaining ETH holdings, the price of Ethereum could decline further from its low suppot level.
“There is a big misconception that ICO companies have liquidated most of their ETH holdings. On average, all of these projects have moved or liquidated 62 percent of the amount that they initially raised. In other words, they are still holding 38 percent of the initially raised amounts. This, in turn, creates ETH selling pressures, which are unlikely to go away any time soon,” Diar chief editor Larry Cermak said.
However, on October 1, BitMEX Research, a subsidiary of major cryptocurrency exchange BitMEX, released a study entitled “Ethereum holdings in the ICO treasury accounts,” listing the holdings of ICOs and the estimated balance sheet of major blockchain projects.