Experts: Ethereum Fall Indicative of Sound Asset
March 29, 2018
Ethereum is just in the middle of three-month gradual decline. The second largest cryptocurrency with market cap of 45.8 bln dollars has dropped dramatically from the January 13 record level of 1,432 USD. Experts claim, however, the fall was quite a reasonable correction after immense growth.
“It’s a natural cooling off period following an unprecedented bull run towards the latter part of 2017”, notes Edward Cooper of Revolut banking firm. “This run-up was fueled by speculation rather than technological advances, and so many people entered the space drawn by the price headlines only. We are now seeing a return to more normal trading where the price consolidates, and any increases are driven by technological advances and increased adoption rather than the news cycle”.
“It is obvious that people are losing faith in crypto recovery tale and start taking money from the market”, as Tanya Abrosimova, financial markets writer, points out. “ETH is the smart contract currency that is used in ICO projects, targeted by both regulators and media giants. It makes the coin especially sensitive to the news about advertising bans and regulatory crackdowns in Initial Coin Offerings.”
It is yet unclear where Ethereum is heading to. Cooper adds, the January cycle of rush and collapse has already occurred earlier in 2011 and 2013. These periods may produce long-term consequences for the price: last year Ethereum tokens cost one tenth of the current price (just 51 USD). Further developing of smart contract technology is likely to move prices on so that Ethereum could cost $5,000 next year.