Ever since Ethereum's all-time high of about US$400, it has seen a steady decline in value. At the time of writing, ETH's price is around US$183 per token. It is currently the weekend, and the price is probable a little deflated due o that. For Ethereum's investors and holders alike, however, this feels like the price correction that will not stop. Let's take a look at a few of the reasons why Ethereum may be performing the way it has been.
PRICE CORRECTION AND ICOS
Ethereum had an incredibly impressive run earlier this year. It exploded from just over ten dollars to its all time high of US$400. There was a time when it was even a contender for Bitcoin's crown as top dog in the cryptocurrency world. However, those days seem to be long gone. Ethereum continues to suffer from a price correction, which undoubtedly has left the wallets of investors who boutht high reeling.
One of the reasons that Ethereum needed this price correction is the number of ICOs which were running on the Ethereum platform. By investing all this Ethereum in various projects, it locked those funds out of the overall market. This created an artificial scarcity which made demand soar along with the price. That bull run was unsustainable, however, and some of Ethereum’s problemsbecame more obvious to investors. Many sold, and some were left disappointed by shell-ICOs and vaporware.
However, those who held Ethereum before the bull run should not be too upset with the current price. Things move quickly in crypto, but one has to remember that ETH was worth $10 in January of this year. Some holders have seen the worth of their ETH rise twentyfold.
SO WHAT’S NEXT FOR ETHEREUM?
Ethereum does have some cool things happening in its space right now. Obviously, smart contracts are popular and there are additional plans to incorporate them. There is also talk about a shift to Proof of Stake in the future.
Ethereum may stay dormant for a while, since its price correction — though still ongoing — has recently calmed down. However, I would not be the least bit surprised if in a few months we see another bull market for Ethereum. I do doubt, though, that any run would be as impressive as the one we recently saw.
This is not investment or trading advice. Always do your own independent research.