Ethereum is very close to taking $200, a very considerable resistance line that may clear the way for the second biggest cryptocurrency.
It has gained 10% today on incredible volumes of $10 billion, an all time high that considerably surpasses the January 2018 peak of $2 billion.
The long term view price chart shows eth has returned back to pre-November 2018 and seems to have recovered to the first low of June 2017.
As can be seen there from August to circa October, breaking the $200 something was a pretty tough task for bears.
Whether that will be any different for bulls remains to be seen, but there may have to be a war here or maybe it just goes through like nothing.
The cryptocurrency has seen its inflation drop considerably recently after a fork two months ago, bringing it down from circa 7% to now 4%.
That has reduced daily new eth amounts by ◊7,000, with the new Hybrid Proof of Stake (PoS) now back on testnet.
The original idea was for stakers to finalize Proof of Work (PoW) blocks, so requiring far less security from miners, and thus reducing their block rewards from 2eth per block to circa ◊0.6.
Whether they will stick to that, remains to be seen, but if they do, eth will be the first to have a halvening later this year, while Bitcoin and BCH are expected in May and April 2020 accordingly.
For all of them, inflation will be reduced to about 2% a year, with new money so meeting the old FED for the first time.
Very uniquely among the top coins, eth also has a different probabilities calculation. Sharding. Will it work and will they be able to really figure it out while keeping decentralization that can be measured through a simple question:
Would a developer of very modest means, say earning $30,000 – $50,000 a year, be able to on his own fork the entire network with the only expense being his time and intellect and spendings that can be considered irrelevant?
That remains to be seen, but “when sharding comes online that will be quite far from anything that has been done before,” says Vitalik Buterin.
That question of probabilities, in addition to the Solidity programming language and all the rest, is what keeps eth a challenger. Something that comes with a few considerable perks.
First, regulated eth futures might be coming. That would be eth’s debut to mainstream finance, the only coin to do so besides bitcoin.
From that might follow everything else that has followed for bitcoin. Regulatory clarity, clear path for institutional investors, increased trust levels due to being under some regulatory oversight, and then potentially eth settled futures.
Finally, from a neutral point of view, there’s another potentially significant consideration that can make great difference depending on how it goes.
This may get a bit complex, but bitcoin is objectively more advanced at this stage and that is probably because it is older and thus has had the opportunity to consider things first.
We’re speaking of the Lightning Network, which has its problems but it runs. Far more importantly, we’re speaking of sidechains and this could be a battle ground.
ConsenSys recently presented a paper on sidechains that connect to ethereum. In bitcoin, a similar paper was presented all the way back in 2014, with some differences in detail but that’s the execution part rather than just words.
Blockstream has built a sidechain of sorts that leaves much to be desired arguably, but that’s the learning process. While they’re launching such sidechain coins onto exchanges, eth is just beginning to consider them.
Where they are now potentially doesn’t matter at all. The question is which one is likely to make it work in a way that is satisfactory. Whoever does, has effectively connected intranets to the internet, and that could be very big.
Such considerations are part of the equation when analyzing where things might be potentially even a year from now.
It’s a race, and the top coins are usually complementary, but, for now all cards are off as spring starts giving way to summer and as bunnies start maybe tempting bulls.