Ethereum Rises in a Sea of Red – Trustnodes

Ethereum Rises in a Sea of Red

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Ethereum is flashing green today, when almost all other top currencies are in red, with eth defiantly bucking the trend to give us all some green shoots.

The currency rose from $295 yesterday to a recent high of $314 before settling at around $307 at the time of writing.

While its trading volumes have doubled, from yearly lows of $200 million to a slightly more respectable $400 million, with South Korea’s Bithumb ruling the trading waves for eth, handling around $70 million in the past 24 hours.

Ethereum’s price action in the past two days.

There is no specific news, as far as we can see, suggesting a convergence of factors to explain this recent bullishness.

Some of them are eth specific and mechanical. Ethereum has become more rare recently, because mining difficulty is increasing faster than usual as the difficulty bomb has kicked in. That has increased block-times, thus decreasing issuance and inflation.

The Metropolis hardfork is now in the process of implementation, with clients released, much of the ecosystem upgrading, and the fork so occurring on October 17th.

That will lower issuance to 3eth, while also lowering block-times, so keeping eth’s current rarity, as the currency undergoes a slow and gradual halving of sorts.

That supply and demand 101 might itself explain some of the bullishness, but another major factor might be less directly related to eth and more related to surrounding events.

Bitcoin risks utter chaos in the coming weeks, with Bitfinex saying they will call the segwit1x chain as BTC even if it is the minority chain, while some other entities stated they will call segwit2x BTC.

Which means bitcoin might face a situation where no one quite knows what bitcoin is. Hence, it is probable one of them is bluffing, not least because it is highly unlikely we will see two chains without one engaging in protocol level modifications.

Whoever does so, is sacrificing security, therefore would be giving up claim to the bitcoin name and ticker, at least for regulated exchanges.

But no one can be quite sure of that, which means uncertainty. Something the market doesn’t really like. So eth’s rise while others fall might be more due to the currency being seen as a safe heaven in troubled times for bitcoin.

It’s unclear how many refugees from bitcoin’s civil war eth is accepting, but even in censored fora we have read some whispers about escaping to eth.

However, this is bitcoin, and as we well know all things in the bitcoin land are actually good news™.  So nearer to the fork they might once again talk about “free money.”

But in this case it’s not clear which one would be free money, with Blockstream unlikely to easily lay down claim to the BTC ticker.

Which means that for now no one quite knows how the bitcoin mess will be resolved, leaving peaceful eth to look like quite an attractive option in the circumstances if what the market is saying is to be believed.

 

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