http://topchaneloutlet.info 3 Factors Affecting the Current Price of ETH Several reasons for the decline of ETH have been postulated all over the crypto verse. But let us explore three factors as to why Ethereum has declined by 85% in less than 12 months. To begin with , there is the ICO theory that many of the crowdfunded projects are liquidating the ETH raised in a bid to hedge against the current bear market. Refreshing our memory a bit, we remember that the ICO boom took place somewhere between November last year, and March this year. In November, ETH was valued at around $300 and by January it was at $1,400.
In March of this year, its value was around $700 therefore it is understandable if the financial managers at these ICOs gave the green light to liquidate all holdings to prevent further losses. Secondly , the Ethereum network is due for an upgrade that aims at solving the scalability issues on the network. Ethereum’s core developers had scheduled a hard fork this October that was later postponed till next year. Known as Constantinople, the software upgrade is meant to usher in the path for the network to transition from a Proof of Work, to a Proof of Stake blockchain network. The delay has dealt a psychological blow to investors who have probably sold part of their holdings or hedged against further losses by buying BTC. Other savvy traders have chosen to short ETH in the markets due to this fact. A third reason why the price of Ethereum has not improved, is the emergence of competing blockchain projects that have faster, cheaper and more efficient networsk.
One of these projects is TRON and the platform can handle 2,000 transactions per second in comparison to Ethereum’s 25. The number of daily transactions on the Tron network has also exploded since the Tron Virtual Machine was activated on the 12th of October. As more DApps are now being created on the Tron network, the urgency to scale the Ethereum network has never been greater than at the present moment. Summing it up , we have looked at three possible reasons affecting the price of Ethereum in the crypto markets.
We started with the theory of ICOs selling their ETH due to the bear market. We then postulated the theory that the postponement of the Constantinople hard fork, had a psychological effect on investors. Lastly, we explored the competition in the form of Tron that has proved to be a more faster, cheaper and efficient network. Another way at looking at the current ETH situation is that the digital asset is highly discounted right now. Therefore, now is an opportune time of grabbing and storing the digital asset in anticipation of a market recovery and the scheduled upgrades. What are your thoughts on the current price of Ethereum? Please let us know in the comment section below.
Disclaimer: This article is not meant to give financial advice. Any opinion herein is purely the author’s and does not represent the opinion of Ethereum World News or any of its other writers. Please carry out your own research before investing in any of the numerous cryptocurrencies available. Thank you.
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