[jcousins]

Putting aside the contributors and developers I think people invested based on one theme - chasing gains. The technology sounded great, I imagine people spent some time learning about an area of computing they really had no understanding of but the technology was probably far from the main reason they chose to invest. I doubt that the economics came into the decision making process at all.

Back in 2014 it made sense to divest a small proportion from bitcoin if you made significant gains. Fresh, crypto-wealthy people with little to no investing experience (or even basic wealth management) tended to look to new cryptocurrency projects rather than fiat vehicles for divestment. Say what you will about that line of thinking, but it paid off for anyone that held onto their presale ether. At the time there were many new similar projects running presales. Some of those are now at a loss based on bitcoin's value, others are breaking even or failed and ethereum has gone parabolic.

The going rate if you participated near the beginning of the ethereum presale was 2000ETH/BTC which was ~$600 at the time. This was an easy gamble for anyone with double digit bitcoins and the foresight to invest conservatively. One bitcoin invested in the ethereum presale is now worth nearly $1M.

Does it make sense invest in this space now as an independent investor? Definitely not. The signal to noise ratio is god awful, the economics don't make sense (to me, at least), the sharks are circling and it is going to take a long time for the technology to catch up with the hype.

When we see crashes of epic proportions I believe it is going to bring heavy-handed regulation and many are going to lose everything. People will be looking for blood and they will look to projects like ethereum for their pound of flesh.