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Status ICO causes failure in the Ethereum network

The feverish demand for the Singapore-based Status tokens during its initial coin offering has led to a massive malfunction on the Ethereum network. The ETH exchange rate has fallen to $330.

Status ICO started on 21 June, it was planned to attract around 300,000 ETH, or about $100 million at the current rate. But soon after the bidding, investors started to notice problems with sending funds to the ethereum-purse of the ICO. According to etherscan.io and their data on transactions in the Ethereum network, the ecosystem faced unusually high traffic that caused congestion problems.

As of 22 June, about 1,664 transactions for more than 11 thousand ETH still remain unconfirmed.

Other users of Ethereum also experienced problems with transactions, even though they did not participate in Status ICO: their transactions remained "pendant" in the network.

Two cryptocurrency exchanges, Bittrex and Liqui, decided to disable Ethereum wallets due to the network problems, NewsBTC reports. As a result their customers could not deposit or withdraw ETH from their wallets. Later Bittrex resumed ETH transactions, but customers still experienced delays.

As a result, the ETH rate fell by 11%, from $370 to $330.

Due to the numerous ICOs and a feverish demand for new tokens, the Ethereum rate has jumped more than 40 fold since the beginning of the year. The Ethereum ecosystem serves as a platform for initial coin offerings, and the ETH token is used to raise funds within the ICOs. As a result, on the eve of large-scale ICOs, investors transfer assets to ETH and thereby increase the demand and rate of the token. On 20 June, for the first time in the history of Ethereum, the number of transactions in the network exceeded 300,000.

Status attracted 299,897.84 ETH, or $ 94.7 million at the current exchange rate. According to its developers, Status is a decentralised open-sourced mobile messenger and browser application for iOS and Android operating systems.

Source: coinfox.info

  • June 24, 2017 10:58 AM MSK
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