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Could ETH Price Drop To Zero?

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ETH price
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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.

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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

Ripple XRP Mega Breakout: What’s Next?

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Ripple XRP mega breakout
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The Ripple XRP mega breakout that we were calling for happened and happened much quicker than anyone expected. As we said yesterday:

Nonetheless, IF, Ripple is capable of going ‘topside’ of the .38 figure at any point in the days/weeks ahead, such development, should it occur, would likely trigger its next advance into the .42 – .47 zone, representing a 30-40% move from present levels. On the flip-side, the .25 – .26 area should offer short-term potential support.

XRP is now sitting at .51704  as we write this article this morning, representing gains of 61% since we alerted our readers and our Global Elite email newsletter members.

Ripple XRP Mega Breakout

The Ripple XRP mega breakout is significant because it’s the first time XRP has been above its 50-day moving average since May. Right now, the RSI is approaching 80, so we are in overbought territory and we expect the price to consolidate around the .42 to .47 level before resuming its uptrend.

While some are looking at this as an opportunity to short XRP, we are not of that camp. While some can book some profits and use a trailing stop, any integration of XRP with xRapid has the ability to create a tremendous move in XRP. As Travis Kling said this week on the Off the Chain podcast with Anthony Pompliano, XRP could be the quickest five-bagger investors…

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Altcoins

Litecoin Cash (LCC): The potential mover?

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Litecoin Cash
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Litecoin underwent a hard fork in the past, and that is what led to the creation of Litecoin Cash. Bitcoin has also experienced a hard fork, which has led to the creation of Bitcoin Cash, so this trend is not necessarily brand new.

Forks have occurred pretty often now in the cryptocurrency community, and the perception is that it probably will continue to, as long as the need (forks are often created to overcome issues faced by the originals) remains there.

While the market has been bearish for most of the year, it has been showing some definite signs of life, especially when we look at the kind of price action that has been happening with Ripple recently. Litecoin is also rising in anticipating of its hard fork, which is to be expected.

For those who are unaware, Litecoin Cash was created earlier this year. 10 Litecoin Cash was given to every investor who had 1 Litecoin – and that one move, it’s easy to see, was very massive concerning value.

Charlie Lee, the founder of Litecoin, has come out against LiteCoin Cash, calling it a scam. Many cryptocurrency influencers have come out against Litecoin cash, although there are still others that believe that this is only because the project threatens them.

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Altcoins

The Stage is Set for Stellar XLM vs XRP

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XLM vs XRP
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The digital asset of XRP, did something spectacular on the 18th of September when it shocked the crypto-markets by rising in value by 21%. In a time period that was less than 5 hours, XRP spiked from levels of $0.273 to those of $0.332 and has continued rising. The digital asset is currently valued at $0.36.

xRapid Factor

The reason for the sharp increment in value of XRP was news that the Ripple company was going to launch xRapid in the next month or so. This was after the firm’s head of Regulatory relations for Asia-Pacific and the Middle East, Sagar Sarabhai, made the following comments during a CNBC interview on the 17th of September:

“I am very confident that in the next one month or so you will see some good news coming in where we launch the product live in production.”

Stellar’s Cross-Border Payments

The news of Ripple launching xRapid has come 2 weeks after the Stellar project and IBM, announced that they were entering the industry of cross-border payments through their new service known as IBM Blockchain World-Wire. The new payment settlement service has been quoted as being ‘near instant’ meaning that it will probably rival the transactions time seen in the xRapid pilot tests of 2 – 3 minutes earlier on in the year.

Stellar Acquiring Chain

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