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Could ETH Price Drop To Zero?

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ETH price

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.

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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.

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Altcoins

Rewards Platform StormX Offers 50% Crypto Cashback Bonus for Thanksgiving

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Singapore, Singapore, 23rd November, 2020, // ChainWire //

Blockchain-based rewards platform StormX has released a seasonal promotion for its award-winning Crypto Cash Back App. The promotion will allow app users to earn a 50% bonus on top of their cashback between Thanksgiving Day and Cyber Monday (November 26-30).

StormX has also introduced a brand-new staking service, allowing users to earn an additional 50% per year when they stake STMX tokens. The native ERC20 token of the StormX ecosystem, STMX has a total supply of 10 billion and is available to trade at many of the world’s top exchanges, including Binance and Bittrex.

“With Bitcoin’s price approaching its all-time high, interest in cryptocurrencies has renewed, though some people believe it’s now too expensive to buy in,” said StormX CEO and Co-Founder Simon Yu. “What we have done is create an easy way for such individuals to accumulate bitcoin, ethereum and other cryptocurrencies via everyday shopping.

“We’re also excited to provide users with the ability to earn greater rewards simply by staking their tokens.”

Since the StormX mobile app launched its Shop feature with over 700 stores in February 2020, some 400,000 unique users have been added to the rewards platform. StormX has also witnessed over 50% month-on-month growth for sales. The app is available for download on the App and Google Play Stores, and can be downloaded as a browser add-on from the Chrome Web…

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Altcoins

BITTREX GLOBAL CONFIRMS FREE TRADING AND LISTING FOR TOP DEFI TOKEN

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Valduz, Liechtenstein, 17th November, 2020, // ChainWire //

International cryptocurrency exchange promotes free trading and no gas fees for leading DeFi tokens

17th November 2020 — Bittrex Global GmbH. announced today 8 new DeFi tokens will be listed this week including:

  • UMA (UMA)
  • Aave (AAVE)
  • Balancer (BAL)
  • REN (REN & renBTC)
  • Kyber Network (KNC)
  • Band Protocol (BAND)
  • YF Link – (YFL)

Bittrex Global’s users can trade all of their DeFi  tokens with no trading or gas fees until 2021. The decision to enable free trading on Bittrex Global for DeFi tokens  follows on from the 1,000% growth of the DeFi asset class over the course of 2020.

The decision to enable free transactions will see more investors enter the Blockchain Act’s digital asset regulatory system, supervised by the Financial Market Authority in Liechtenstein (FMA) under the Due Diligence Act which requires traders to comply with the KYC/AML/CFT standards.

“The last year has seen huge growth in DeFi as an asset class and a number of significant milestones completed,” said Bittrex Global’s CEO Tom Albright. “As the asset class matures and more institutional and professional investors look at the fundamentals, we are likely to see increased demand and higher trading volumes for DeFi in 2021.

We’re really excited about what we’re seeing in the space and want to see these DeFi projects grow and help them build stronger platforms through increased adoption. Offering free trading fees…

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Altcoins

Ready for Chaos? Swingby’s Chaos-Mainnet Launches on December 28th

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Singapore, Singapore, 9th November, 2020, // ChainWire //

Swingby is the “warp-speed” protocol for inter-blockchain swaps. It allows all DeFi users to move assets between blockchains without a trusted party. 

Today, Swingby announces its first mainnet network will be released on the 28th of December; it will bridge native Bitcoins onto Ethereum via Wrapped BTC (WBTC).

The initial bridge will enable the most liquid digital asset in the world (Bitcoin), currently valued at a $300 billion market cap, to be moved onto the Ethereum network to tap its $10b DeFi ecosystem.

“This launch will be pivotal to Swingby. After December 28th, Swingby will have a fully operational Chaos-Mainnet network which will be generating a tremendous amount of value to the world of DeFi and bringing in a large number of new users” – Yusaku Senga, CEO

Why is this big news for DeFi?

On December 28th, Swingby will be launching its first Chaos-Mainnet bridge, allowing users to easily move their bitcoins into WBTC on Ethereum without the need for a trusted party. Similarly, the bridge can be used in the opposite direction allowing WBTC-ERC20 tokens to be moved back into native BTCs.

What’s so special about it?

  1. Trustless: Swingby’s Skybridge will be the only way to trustlessly swap BTC into wrapped Bitcoin (WBTC).
  2. Simple to use: The Swingby bridge has been designed to work with standard transaction types removing the need for complex smart contract calls…
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