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If you woke this morning to flashing red on your trading screens, don’t be alarmed. Yes, there was a fall in crypto prices, but the retracement was due in large part to Bitcoin Cash (BCH).
BCH was finally added to Coinbase, a leading U.S. exchange that serves as most people’s gateway into the wacky world of cryptocurrencies. This solitary act sent BCH prices soaring, thus sucking all the oxygen out of the market.
Ethereum was hardly the only loser.
Prices fell across the board, save for highfliers like IOTA and Dash. ETH lost 4.97% against the U.S. dollar, bringing the Ethereum to USD rate to $812.63.
On a brighter note, the Ethereum to Bitcoin rate increased 5.01% to 0.04783840 BTC.
Daily Ethereum Chart:
This means that Bitcoin’s fall was much sharper by comparison. This trend could potentially continue if BTC scaling issues are not resolved.
For example, one Twitter user complained that 40% of their transaction was spent on fees. This level of inefficiency cannot go unchecked forever.
Furthermore, some regulators are voicing concerns about Bitcoin’s intrinsic value. Namely, that it doesn’t have one. (Source: “Central bank chief warns over Bitcoin valuations,” Sydney Morning Herald, December 19, 2017.)
“Bitcoin has no natural intrinsic value,” Sopnendu Mohanty of the Singapore Monetary Authority said to The Daily Telegraph. “Can you buy a house with it? Can you use it for daily interactions? It may be valued at $US18,000 ($23,477) right now but what I want to know is how you convert it into fiat currency and realise that value. The risk comes at the moment of conversion.”
You could brush this claim aside as condescension. After all, central bankers have poo-pooed Bitcoin for years. This is nothing new. Except that Mohanty was very specific about Bitcoin.
When it came to Ethereum, he said, “It at least has economic value. You can exchange ether to run software in the cloud.”
What’s my point?
Only that Bitcoin critics have not disappeared in the wake of its price surge. If anything, their criticisms are more pointed. They can now point to Ethereum in order to say, “Hey, isn’t that more useful than Bitcoin? Why not use that one?”
Analyst Take:
Ethereum’s practicality is one of the reasons we love it, so it’s nice to know that even blockchain skeptics are taking notice.
We see nothing in today’s Ethereum news that would change our $1,500 Ethereum price forecast for 2018. Just stay the course, dear reader.
Also Read: Ethereum Price Prediction for 2018
Source: Price Confidential
