Ethereum Doubles in Five Days, Rises Above $200

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Ethereum has doubled in five days, rising from $100 to now above $200, as the digital currency continues a bull run the likes of which have never been seen before, even with bitcoin when the total market cap is taken into consideration.

Ethereum’s market cap over the past three months, source coinmarketcap

The Ethereum Foundation is now probably the richest blockchain company, with their holdings estimated at around $200 million to $300 million, while Vitalik Buterin, Eth’s inventor, holds assets valued at around $100 million currently.

They are looking for new talent, with Buterin publicly asking everyone to “send smart people our way. Math, CS, distribution systems, crypto, economy, game theory, behavioral economy, all highly welcome.”

That talent is in short supply currently as the field is very new, but most developers are attracted to ethereum because of its wide range of capabilities that may disrupt many industries.

For that to become more likely, protocol level research is on-going with two areas of particular interest, Proof of Stake and Sharding. Regarding the former, Vlad Zamfir, an ethereum developer, was spotted doing some research pictured below.

Ethereum developers busy researching proof of stake.

Regarding the later, Buterin stated in an update that “substantial work has been done on sharding,” but no time estimate has been provided for either with a good guess being maybe sometime this year, but probably next year.

That raises the question of whether ethereum can handle this level of growth. Transactions have reached a new high again yesterday at 187,000. If they double, they would overtake bitcoin’s transaction levels and more, while the network would still be working perfectly well.

After that, it can handle another doubling or thereabouts, functioning well while processing around one million transactions a day, but then it will start needing more capacity provided by Proof of Stake sometime this year but most probably next year.

If we translate this into price as transaction levels and price levels are highly correlated, that would be a doubling to $400, then another doubling to $800, with the network performing fine if price was at $1,000, but thereafter it would need Casper.

At $1,000 per coin, Ethereum’s market cap would be around $100 billion, near the same level as the current market cap of all digital currencies combined. In turn, the Ethereum Foundation would hold assets worth around $1 billion, giving them plenty of funds for developers to speed up the research and provide the needed capacity.

 

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