Here Is Why Ethereum Price Rose From $85 To $135 In One Week
Ethereum News: While all eyes have been somewhat diverted by the recovery of Bitcoin (BTC) in the past week, Ethereum (ETH) managed to outperform the flagship cryptocurrency within the same time frame.
Over the past seven days, Ether moved from $85 to $130, a whopping 50% gain, according to data compiled by Live Coin Watch. While the tokens are gaining some momentum, the aggregate value of all cryptocurrencies observed a comparatively smaller moment from $102 billion to $134 billion, over the past week. So how come Ethereum rallied so much?
The much-awaited update of ETH that will activate on the processing of block 7,080,000 is slated to arrive around January, as confirmed by the recent Ethereum core developer bi-weekly call.
For the uninformed, the Constantinople update is a pertinent event in Ethereum’s long-term calendar as it will plausibly take the network one step closer towards Serenity. A blockchain researcher, Justin Drake, told Ran NeuNer that Serenity, or Ethereum 2.0, has been evolving just fine. He further claims that researchers continue to propose better and better designs for the upgraded blockchain, which would see the network activate Sharding, a protocol that speeds up data processing.
Serenity has even received praise from Vitalik Buterin, a co-founder of ETH. The Russian-Canadian coder noted at Devcon4, that the blockchain overhaul may eventually facilitate “pure PoS consensus, faster times to synchronous confirmation (8-16 seconds), economic finality (10-20 minutes),” and, most importantly, a 1,000x scalability upside, which will likely discredit all fears of scalability.
As the launch is nearing ETH enthusiasts will likely continue to “buy the rumor, sell the news,” pushing up the price of ETH.
The ConsenSys Effect
Last week, the leading Ethereum development studio ConsenSys was preparing to lay off 50%~60%of its 1,200 staffers in an apparent bid to cut costs, as reported by The Verge. It was claimed that a co-founder of Ethereum and the head of ConsenSys, Joseph Lubin, was planning to mark off employees that weren’t pertinent to the New York-headquartered startup’s future (2.0).
This invited a flurry of doubts for the network, seeing that ConsenSys plays a key role in Ethereum’s ecosystem by hosting the MetaMask, Truffle, Alethio, and Kaleido. In an event of the startup being collapsing, it will take a major chunk of ether down with it. However, Lubin subsequently claimed that the rumor of “conjecture and preemptive paranoia” thrown at the firm does not hold credence, as ConsenSys “remains healthy and is engaging in a rebalancing of priorities.”
Albeit a small role, this clarification by Lubin did help in restoring investors faith back in the network and on Ether.
While the crypto community is waiting for a Bitcoin ETF, the second-most valuable capitalized cryptocurrency is also in the line for such approval. The past week, the U.S. Commodities Trading Futures Commission (CFTC) made a “request for information” to the public on the matter of alternative cryptocurrencies, namely ETH. The governmental regulator wrote:
“The RFI [Request For Information] also seeks to understand similarities and distinctions between Ether and bitcoin, as well as Ether-specific opportunities, challenges, and risks.”
The CFTC is seeking public sentiment and comments to precede its ruling on an ETH-backed instrument, like proposed Ethereum futures backed by CBOE. The arrival of such an instrument could be the catalyst of moving the asset higher over time.
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