Connect with us

Blogs

Could ETH Price Drop To Zero?

Published

on

ETH price
READ LATER - DOWNLOAD THIS POST AS PDF

As frightening as the above title may sound, the ETH price might go to zero. This is according to several observations by crypto enthusiasts about the technical difficulties the platform is having in scaling. Global Coin Report recently published a piece on how the Stellar network is more advanced than that of Ethereum. In the piece, Stellar was discussed as having a higher throughput that Ethereum as well as being more secure.

It is also with a similar observation that Jeremy Rubin – a technical adviser to Stellar, a Bitcoin Core contributor, investor, and adviser to crypto startups and a freelance consult for cryptocurrency tech – had this to say about Ethereum in a recent TechCrunch post:

“Here’s a prediction. ETH — the asset, not the Ethereum Network itself — will go to zero. Those who already think that ETH will not see real adoption — thanks to a failure to scale, to adopt more secure contract authoring practices, or to out-compete its competitors — don’t need to be convinced that a price collapse would follow as a consequence.”

Life on the Ethereum Network without ETH

He would go on to postulate that the ETH price will go to zero as a consequence of the Ethereum network thriving. The network might reach a point where it will not need ETH to pay for transaction fees on the network.

“But, if one believes that Ethereum will succeed beyond anyone’s wildest dreams as a platform then the proposition that ETH (as a currency) will go to zero will take a bit more convincing running a substantial share of the world’s commerce securely.”

At first, it sounds a bit confusing given the fact that ‘Gas’ in the Ethereum network is paid in ETH. With a thriving Ethereum network, the ETH price will surely go up using traditional laws of economics such as supply and demand.

ETH price not in the Value Proposition of ethereum.org

Jeremy Rubin points out that the digital asset of ETH has been left out of the value proposition given by ethereum.org. The omission of ETH as an asset in the value proposition is grounds to state that it can be replaced in the Ethereum network, thus leaving room for a scenario where its value will automatically fall to zero.

How Will All This Happen?

Firstly, the fees paid to process transactions on the Ethereum network are simply known as ‘Gas’. The latter is a metaphor similar to the fuel used in gasoline-powered vehicles. This fuel can be changed through a slight modification of the engine or changing it completely like how Elon Musk is doing it with electric vehicles. Therefore, with no hard requirement for ‘gas’ to be in ETH, the digital asset can be replaced with another.

The paying for ‘gas’ in a non-ETH asset is sometimes referred to as economic abstraction in the Ethereum community. Miners can be incentivized to mine transactions with another digital asset as a reward.

But the economic abstraction of ETH meets a few challenges such as developing appropriate software to support such a change. There is also getting the approval of the Ethereum community to orchestrate such a hostile takeover of their favorite digital asset.

In conclusion, and according to Jeremy Rubin, there is a hypothetical situation where the ETH price drops to zero if applications on the Ethereum network can run without the digital asset as ‘gas’ for transactions. This situation is a 180-degree turn from the usual thought that the value of ETH will drop due to congestion issues on the network. In the case of the latter, the Ethereum core developers will probably have a solution in the future to solve the scalability issues.

For the latest cryptocurrency news, join our Telegram!

Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and/or its affiliates, employees, writers, and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency and read our full disclaimer.

Image courtesy of Pexels

Bitcoin

Investors Beware: Another Large Bitcoin Crash Might Be Coming

Published

on

Bitcoin crash
READ LATER - DOWNLOAD THIS POST AS PDF

The crypto prices have surged quite high in the last few months. Of course, their progress is nowhere near the one seen in 2017, but they appear to be getting there, one day at the time. However, things might not be as simple as that, and according to recent performance — it is more than possible that a major Bitcoin crash is incoming.

The fact is that cryptos saw a massive amount of growth in a very short period. Bitcoin itself more than doubled its price in only two months. Now, the rally is starting to crash in on itself, and the coin is already about $1,000 lower than last week. If such development does come to pass, a lot of people will experience quite large losses, although experienced investors might find some opportunities, and leverage in order to enhance their holdings’ long-term value.

For example, Bitcoin dominance is expected to crash very quickly, which will work in favor of quite a lot of altcoins. While this does not seem to be the best time to invest in BTC, altcoins are another story, and diversifying a portfolio now might end up being very profitable in days to come.

Bitcoin behavior mirrors the pre-bear market situation

The crash that analysts are predicting right now comes as a direct consequence of all the hype that has been building up in…

Continue Reading

Altcoins

Top 3 Coins to Buy Before They Go Big

Published

on

coins
READ LATER - DOWNLOAD THIS POST AS PDF

Crypto bulls are back, that much is clear. The long-lasting, harsh crypto winter is gone, and the new era in digital currency sector opens up some rather interesting opportunities. With many more bull runs expected to come in months ahead, a lot of coins are likely to blow up and maybe even hit new all-time highs, although that still remains purely theoretical.

On the other hand, the fact is that numerous coins are seeing prices that were not achieved since early 2018, and the overall momentum remains bullish. With that in mind, even if new records do not come for a very long time — chances are that many of the coins will blow up enough for investors to see some serious gains in months to come. As a result, investing in some of these coins now might be a very profitable decision, for those who have the patience to wait a few months. Here are some of the projects believed to have the greatest potential to go big in the second half of 2019 and beyond.

1. TRON (TRX)

Putting TRON on the list should not really surprise anyone, as the project constantly comes up with new project updates, partnerships, and alike. It also constantly breaks records, as is becoming one of the biggest players in the dApp and smart contract development sector.

In the past few…

Continue Reading

Blogs

Can Crypto Credit Cards Disrupt the Fight Against Financial Crime?

Published

on

crypto credit cards
READ LATER - DOWNLOAD THIS POST AS PDF

It is commonly known that the world of finances has the biggest problem with the crime of all existing industries around the world. It has been so throughout history. While the financial world has evolved, so did the criminal activities, and they continue to be an issue. With the arrival of cryptocurrencies, many were hoping that financial crime might be disrupted. However, for now, at least, it appears that cryptos themselves cannot find a way to resolve issues such as international money laundering.

In fact, when it comes to money laundering, the crypto sector appears to be the weakest link, especially because of the nature of digital currencies. The anonymity that cryptos are being praised for means that anyone can get a payment from an unknown source from anywhere in the world. This method can then be used for financing drug trafficking, cyberattacks, terrorists, and more.

Until recently, it was not easy for bad actors to make use of cryptocurrencies obtained for illegal purposes. The number of merchants willing to accept the coins was low, and criminals were forced to find a way to exchange crypto into fiat currencies. However, this came with a set of issues, such as taking foreign exchange risks and then sending the money through wallets and exchanges to a banking system that would allow withdrawal. The banking account was the biggest obstacle here,…

Continue Reading

Elite