Ethereum Rebounds After Sinking 20% on Tuesday

Cryptocurrency prices, including Ethereum, rebounded on Wednesday following a significant drop in the previous session prompted by reports indicating that ICO investors were liquidating their holdings.

Ethereum saw an increase of 5.4%, reaching $6,324.7 during the early hours. Other cryptocurrencies also experienced gains, with one trading 6.2% higher at $284.9. Additionally, another currency gained 7.6%, climbing to $0.28539, while another surged 6.9% to $55.946.

On Tuesday, Ethereum had plunged by 20% after it was revealed that investors who had acquired digital coins to engage in initial coin offerings were cashing out to manage expenses amid fears that the bear market in cryptocurrency may persist.

Samson Mow, the chief strategy officer at Blockstream Corp, commented, “Most cryptocurrencies have been overvalued for a very long time. It’s hard to pin this move on any particular factor, but it feels like a reversal of last year when money flowed in due to FOMO. Now, it’s flowing out as panic sets in.”

In July, the cryptocurrency sector had a brief rally amid hopes for the announcement of a Bitcoin-backed ETF, but the U.S. Securities and Exchange Commission has postponed its decision regarding the listing of a fund from VanEck Associates Corp and Solid Partners Inc until the end of September.

In other news, Coinbase, one of the largest cryptocurrency exchanges globally, reported an influx of approximately 50,000 new customers per day last year, as confirmed by CEO Brian Armstrong.

Armstrong stated at the Bloomberg Players Technology Summit in San Francisco, “This technology goes through cycles of bubbles and corrections, and each time it reaches a new plateau. People’s expectations vary widely, but real-world adoption continues to rise.”