Ethereum has had a successful 2021 by every metric as it began the year with prices at around $700 before going on to set a new all time high of $4,362. This growth represents an over 500% increase within 6 months, but the recent dip in global cryptocurrency prices has taken the shine out of Ethereum’s price performance.
The continued anti-crypto stance of Chinese authorities has seen miners dump their GPUs, while Power Ledger has unveiled plans to ditch Ethereum in favor of a rival. Despite the negatives, there may still be light at the end of the tunnel as the asset shows its resilience.
The Dwindling Fortunes of Ethereum
Ethereum prices continue to fall amid a general decline in value in cryptocurrency markets. Presently, Ethereum is standing on the precipice of $2,000 with further indicators that the asset may fall even lower. The asset has slumped by 4.38% over the last day and weekly charts confirm the grim reality as it fell by a staggering 13.04%.
Although prices are falling, daily trading volumes are up by 16.15% at $13.3 billion, which promises impending bullishness.
Despite this, Ethereum has maintained proximity to Bitcoin, while shrugging off competition from rival blockchains. It is pertinent to note that up to this point, the decline has been nothing out of the ordinary and simply follows the usual correlated movements of BTC and ETH.
Although Ethereum has fallen by over 54.15% from it’s all-time high of $4,362, its growth over the last year has been nothing short of astounding, as on this day last year it was trading at a comparatively measly $231.62.
Chinese Miners Dump GPUs, and Power Ledger Says Goodbye
Ethereum’s path out of the storm just got trickier following the decision by Power Ledger to migrate from the network to Solana.
The Australian-based blockchain firm cited higher speeds and better scalability as the main reasons for the switch. It went on to cite the low energy output of Solana’s Proof of Stake consensus mechanism.
Speaking on the development, co-founder Dr. Jemma Green noted that the new platform will be “tens of thousands of times faster than Ethereum, but also energy efficient.”
Increased enforcement on cryptocurrency mining by Chinese authorities has led to the dumping of GPUs by Ethereum miners. This in turn led to a 20% drop in the network’s hashrate as the noose around Ethereum’s neck tightens.
On The Flipside
Is There Light at the End of the Tunnel?
Although things are looking grim for Ethereum, historical antecedents have taught us that we should not write the asset off. Ethereum’s stellar growth in the last 12 months has been simply meteoric and, in the grand scheme of things, this is only a minor setback.
A loss of around 40% in value doesn’t remove the gloss from the towering gains of over 500% in under 6 months.
New upgrades are coming to Ethereum soon. In a few weeks, the community will celebrate the London hard fork update, which is scheduled to go live on August 4th.
Ethereum 2.0 will also see a switch from Proof-of-Work, to Proof-of-Stake, for energy efficiency. The launch of these developments will give Ethereum a strong fighting chance against ongoing bearish sentiment.
As the fuel for numerous projects on the blockchain like dApps, NFTs, and DeFi, it’s safe to say that there is indeed light at the end of the tunnel for Ethereum.
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Source: Cryptocurrency - investing.com
