Ethereum Falls Below $200, Bounces – Trustnodes

Ethereum Falls Below $200, Bounces

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Ethereum has fallen below $200, reaching a recent low of $185 this morning at around 4AM London time on reduced volumes of $1.6 billion during the past 24 hours.

The currency slightly recovered at the time of writing, standing at $190, a price level it has not seen since July 2017, but at time of publishing it bounced to $205.

Ethereum’s price on weekly candles, Sep 2018.

The currency is now down 87% from its all time high in January, making it one of the biggest crash ever for the three year old eth which has seen four crashes, down from $2 to pennies circa 2015, from $20 to 5 in 2016, from $420 to $150 in 2017 and from $1,420 to wherever this ends in 2018.

That may suggest this is simply part of how cryptos work with these recurring crashes most likely caused by Proof of Work miners who currently receive about 20,000 eth per day.

They tend to insta sell it to cover their substantial operations with most of the mining done in huge datacentres with rows and rows of GPUs.

These big miners, therefore, usually do not quite care about the price, so continuing to put pressure on it until it nears cost of production levels when miners face crunch-time.

There may be other causes for eth, such as Initial Coin Offerings (ICOs) liquidating 12 million eth, estimated to be worth $6 billion at the time of sale, this year up to August.

What is probably not the cause is Vitalik Buterin’s claim that crypto growth has hit a ceiling as he claims now effectively everyone knows of cryptos. Something which may be true of bitcoin, but if you went to Times Square and asked passers by whether they’ve heard of eth, the vast majority will probably say no.

According to a recent survey by YouGov, only 13% of Americans have heard of ethereum. Making eth 2018 pretty similar to bitcoin 2014-15. Bitcoin then went on to become a household name, but whether eth will do so remains to be seen.

One can argue, of course, that since they know of bitcoin then that counts for eth too, but that’s not far off from saying since they knew of AOL back then, they knew of Apple iPhone too.

A comparison too crude, but gives the general idea as eth and bitcoin are similar in that they both run on a blockchain, same as Amazon and Facebook are similar in that they both run on the internet, but in many ways they are very different as eth has smart contracts and proper dapps.

In any event, total crypto holders are estimated to be between 35-50 million with a higher end of 200 million. That leaves billions still.

It just appears that the proof of work design makes this crashes somewhat natural in cryptos, but the other coin to it might be what may lead to a floor, that being the point when eth mining becomes unprofitable, or rather, that being the cost of production of one eth.

Copyrights Trustnodes.com

 

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Anonymous
September 9, 2018 8:25 pm

“What is probably not the cause is Vitalik Buterin’s claim that crypto growth has hit a ceiling as he claims now effectively everyone knows of cryptos.”
> I would suggest strongly that Vitalik is trolling. Trolling very hard to be exact