Ethereum, the crypto-token of the Ethereum platform has become increasingly popular amongst cryptocurrency enthusiasts over the past few weeks.
Ethereum’s value has appreciated by nearly 500 percent since the beginning of 2015. In January, one ethereum was roughly worth 0.00212BTC. Almost a month and a half down the line, the value stands at around 0.01101 BTC.
What Are the Reasons behind the Phenomenal Rise in the Price of Ethereum?
Ethereum is notably one of the valuable platforms. With the global FinTech industry shifting towards blockchain technology-based applications to suit their requirements, smart contracts, and automation of financial processes takes precedence.
Ethereum is tailor-made for such applications.
As the demand for the Ethereum platform and its smart contracts enabled network increases, the value of Ethereum as a cryptocurrency will continue to surge.
Demand Driven Appreciation
While there are few investing in ethereum for its future potential, there are those who just follow the trend. The increasing demand and value of a certain cryptocurrency serve as an indicator of its potential (even though it may turn out to be wrong at times). Whatever the reason is, it still increases the demand – meaning a further increase in ethereum price.
Faltering Faith in Bitcoin
It is speculated that the continuing block-size debate is one of the reasons for the increase in the demand of Ethereum. While it is hard to substantiate, the recent number seems to indicate that there might be an ounce of truth in it. In a span of 24 hours, 60,000 BTCs were traded for ethereum last week. There are reports (unverifiable at the moment) indicating a well-orchestrated ploy by unknown individuals or entities sending messages to bitcoin subscribers on social media about Ethereum being an alternative to Bitcoin.
Positive News Reports
Ethereum as a platform has been receiving a lot of positive press lately. Many companies and organizations have expressed their support to the platform.
Ethereum has completed yet another phase. The platform is expected to announce the stable release – Homestead which will follow Frontier soon. Homestead is a very important milestone for the platform as it signifies its maturity from a beta test phase to a more stable development phase. Even though Ethereum will still be far from complete with Homestead release, it is a great progress nevertheless.
It is also reported that ethereum will soon be added as one of the tradable assets on many crypto-trading platforms. It will increase the access to Ethereum market, resulting in more ETH/BTC and ETH/Altcoin trading.
Augur, the much awaited Ethereum based prediction platform is about to be launched soon. And so are many other companies/startups offering smart contract solutions, all based on the same cryptocurrency.
Is the growth sustainable?
Ethereum price reached an all-time high of 0.0171 BTC on 12th of this month, only to experience a considerable fall soon after. Even though the cryptocurrency value is not showing any upward trend at the moment, it has scaled new heights, and it will continue to perform better than it used to in the previous months.
The cryptocurrency may not sustain this growth in a short term, but the demand is bound to grow in the long term. The ones with long term trading plans are bound to gain a lot as time progresses.
The statements, views and opinions expressed in this column are solely those of the author and do not necessarily represent those of NewsBTC. Chart: Kraken exchange data (ETH/BTC) - EthereumWisdom