Despite the favorable outlook, Ether is once again sinking below $ 3,000. A consequence of Chinese threats and the closure of major mining pools.
Ethereum is still going through a period of turbulence this week. The ETH course drops below $ 3,000. Traders’ sentiment towards the crypto-asset’s price outlook remains positive, but a reversal could emerge.
The repeated returns of ETH below the $ 3K threshold are indeed not encouraging optimism among investors. It is true that the latest warning shot from the Chinese authorities is not helping to mitigate the volatility of the cryptocurrency market.
A quarter of ETH mining soon to stop
As for Ether mining, the scenario of the previous months seems to be repeated and which then affected Bitcoin. China, the world’s leading region for BTC mining, heralded the end of this industry in the country.
The Ethereum mining companies are in turn in the crosshairs of the authorities. And the consequences are not long in coming. Several basins or mining pools are thus announcing the imminent end of their operations.
Earlier this week, it was SparkPool, the second largest mining pool, which said it was preparing to cease operations. A day later, the fourth player in the market also threw in the towel.
BeePool, based in China, says it will cut its service from October 15. He further specifies that he has already stopped registering new users. This stop is justified by the latest regulatory changes.
The government’s ban, via its central bank, on cryptocurrencies leaves no room for ambiguity. Any activity involving cryptocurrencies, including trading and mining, is considered illegal.
Migration to ETH 2.0 on track
And for Ethereum mining, the effects are not negligible. Etherscan estimates that the two Chinese basins represent nothing less than a quarter of the ETH mined. This therefore also means future difficulties in the validation of transactions on Ethereum.
Other players are also in line, including the exchanges Binance and Huobi. This is also the case for e-commerce giant Alibaba. The site stops the marketing of mining equipment.
As for CoinGecko and CoinMarketCap, they are now experiencing the Chinese firewall on the Internet. But it is above all the mining of ETH at the global level that should suffer the most from this new turn of the screw from China.
The transition of the Ethereum blockchain from PoW to PoS, however, is on-going. A new major step for ETH 2.0 is also scheduled for the end of next month. Altair, the first mainnet update to the Beacon channel, will take place around October 27.
New Ethereum Prediction Is Out – Here’s The Latest Forecast On ETH’s Price
The crypto market has been seeing some recent corrections, but now things are looking good with most of the important coins trading in the green.
There have been all kinds of bullish predictions out there and the latest one involves the price of Ethereum.
Nicholas Merten drops new ETH price prediction
It’s been just revealed that Nicholas Merten says that Ethereum (ETH) may grow another 325% before the current bull cycle comes to an end.
In a new strategy session, he said that he thinks it will take for Ethereum to eventually smash the $20,000 level.
“If everything goes perfect for Ethereum, if we get that opportunity to be able to get ETH to launch properly, people using roll-ups, whether it be zero-knowledge roll-ups or optimistic roll-ups, generally ‘layer-2 solutions,’ we could see a $20,000 Ethereum this cycle.”
He continued and said the following:
“I know it sounds crazy but when you look at the logarithmic chart we’ve seen these kinds of percentage returns before.”
At the moment of writing this article, ETH is trading in the red and the coin is priced at $4,518.
The analyst made sure to explain the fact that if Ethereum maintains solid fundamentals, a rally to the $20,000 may not be too bold.
He notes that such a gain would only be about half of what ETH achieved in the first five months of 2021.
“I think it’s very reasonable we could see this kind of price level. Somewhere between our neutral and optimistic target. To play it safe, I would say that we’ve got a really solid steady stream of price action for Ethereum ahead of us.”
He also pointed out the following fact:
“The key thing to understand is that there are periods of this cycle where Ethereum outpaces Bitcoin, which makes these higher targets reasonable.”
Ethereum Competitor Becomes Focus of Crypto Firm’s New $500,000,000 Investment Fund
A Miami-based venture capital (VC) firm is investing $500 million into an Ethereum (ETH) competitor’s ecosystem.
Blockchain VC firm Borderless Capital says the investment will go towards digital assets powering decentralized applications (DApps) built on Algorand (ALGO), a payments and decentralized finance (DeFi)-focused blockchain network.
Borderless Capital previously launched a separate ALGO fund in 2019 that raised $200 million, according to an announcement from the Algorand Foundation.
Says Arul Murugan, founding managing partner at Borderless Capital,
“Algorand is the most efficient next-generation blockchain software in the market right now, and it is the next frontier for investment opportunities and disruption.
Our Borderless ALGO Fund II will continue to be at the forefront of the ecosystem and further ignite the growth by enabling the new innovation that is coming to blockchain.”
The Ethereum competitor’s native asset ALGO is trading at $1.93 at time of writing, up more than 8% on the day.
The decentralized blockchain network recently partnered with Hivemind Capital Partners, an investment firm founded by Matt Zhang, a 14-year Citigroup Inc veteran.
In October, Algorand also received an endorsement from American financier Anthony Scaramucci, who said the project could breathe new life into the consumer goods sector.
Whales dominate DEXs as high Ethereum fees keep retail investors at bay
Decentralized finance (DeFi) came into existence to democratize finance, much like the internet made content accessible to everyone.
However, according to digital assets data provider Kaiko, the adoption of decentralized exchanges (DEXs) that facilitate peer-to-peer transactions without an intermediary, remains restricted mainly to large traders or whales.
“Average trade sizes have increased on all DEXs over the past few months while the actual number of trades has stayed flat, which suggests that the profile of the average trader now skews more whale,” Kaiko said in a weekly research note published on Monday.
The average trade size on Curve Finance ranges from $500,000 to $1 million, while deals on other prominent DEXs like Uniswap V3, Uniswap V2, SushiSwap, and Balancer V1 average between $10,000 – $20,000. That’s nearly ten times larger than the average trade size of $2,000 – $4,000 seen on centralized exchanges (CEXs).
However, daily trade count on CEXs tallies into millions while major DEXs process less than 50,000 deals per day, with Curve and Balancer V1 averaging less than 1,000 traders per day.
Kaiko analysts attributed whale dominance to high transaction costs on , the world’s largest smart contract blockchain.
“The large trades are likely due to Ethereum’s high transaction fees, which prevents more retail traders from using DEXs,” Kaiko’s weekly research note said. “Every trader on a DEX must pay Ethereum transaction fees for each trade, which frequently surpass $100 due to congestion and scalability issues.”
According to blockchain analytics firm Chainalysis, DeFi’s growing popularity in wealthier countries is the main reason for DEXs processing much larger transactions than centralized platforms.
While several smart contract platforms facilitating cheaper and faster transactions like Binance Chain, Solana, Polkadot, Avalanche have emerged over the past 12 months, Ethereum still leads the pack.