Ella Zhang of Binance said publicly that she reckons the hype surrounding ICOs and all things cryptos is actually damaging to the wider blockchain community thanks to overvaluations.
She said: “We’d like the bubble to break,” said Zhang, who officially joined the Binance team in May.
“We still see a lot of hype in the market, valuations are high and unreasonable. We really think if the bubble bursts, it’s a good thing for the industry,” she added.
Zhang recently launched a $1 billion venture fund on behalf of Binance.
She said, re the ICO boom, that while the influx of attention from investors and users is, in some respects, a good thing, the truly innovative and game changing projects will likely emerge once the bubble has subsided.
The rise and rise of the ICO
2017 was the year when ICOs really took off, with a little over $6 billion raised from 871 ICOs, according to data from ICODATA.
However, half way through 2018, this has number has already been surpassed by some margin.
More than $9 billion has been raised despite financial regulators the world over clamping down on token sales.
Two notable contributors to 2018’s grand total were Russian messaging app Telegram’s ICO, which raised a staggering $1.7 billion from less than 200 investors during two private token sales.
This along with EOS creator block.one’s year long token sale which concluded last week, having raised more than $4 billion.
Despite Zhang’s beliefs, Binance is still investing heavily in both company equity and cryptocurrency tokens.
Zhang said that Binance, which operates what is currently the world’s highest volume cryptocurrency exchange, plans to develop a new program — called “Community Governance Initiatives” (CGI) — to help the company weed out and delist scams and other projects that do not live up to their promises.
Exit scams and other fraudulent ICOs and crypto coins are a growing problem in the blockchain sphere.
“The main purpose of this is to fight scams and sh-t coins, and to boost crypto and blockchain technology,” she explained.