There was a little hope a week or so ago when Ethereum started to move independently of Bitcoin. The hope has been battered this week when ETH plunged alongside its big brother as it has done countless times before. The impending Istanbul upgrade will improve the technology but can it do the same for ETH prices?
Ethereum Battered Again
ETH has had a tough week. From a high of $220 late last week the world’s number two crypto asset plunged 25 percent to touch a monthly low of $165 yesterday. As a testament to the ever present extreme volatility and the hopeless anchor that Bitcoin is, Ethereum has yet to break free.
Today it is lulling around a five month low of $170 and looking to make further losses if Bitcoin revisits the $7k price range. A return to $150 is inevitable unless BTC can break higher, which is not looking likely yet, or it can move independently, which is equally unlikely.
An Istanbul Rescue?
Network and blockchain upgrades are usually bullish for crypto projects but the newly printed rule book has not applied to altcoins this year. A network upgrade dubbed Istanbul is scheduled to be rolled out over the coming months. It will include a number of Ethereum Improvement Proposals (EIPs) but needs to be deployed on testnets before a smooth mainnet hard fork.
Istanbul is the 8th Ethereum network upgrade which will hit the Ropsten and Goerli test networks next month according to this medium post. November and December will see rollouts on the Rinkeby and Kovan testnets before mainnet launch in early 2020.
The upgrade will include EIPs that address the following issues; aligning the costs of opcodes with their computational costs and improving denial-of-service attack resilience. Making layer 2 solutions based on SNARKs and STARKs more cost effective, enabling Ethereum and Zcash to interoperate (atomic swaps) and allowing contracts to introduce more creative functions.
Ethereum co-founder Vitalik Buterin discussed developments across the wider Ethereum ecosystem at the Ethereal Summit earlier this month. ETH 2.0 clients were successfully linked up a few weeks ago in the first of such interoperability tests. This is a major milestone for the Ethereum development process and Buterin added,
“The next step is to make sure they can maintain a public network at scale. We’re talking about potentially hundreds of thousands of validators aggregating a huge number of transactions,”
The discussion moved on to decentralized finance with is the next big application for Ethereum.
“I’m very excited about the potential DeFi offers in principle. The idea that just anyone, anywhere in the world, can have access to a system that lets them pay each other, and choose their own financial exposure, is a really powerful thing. It’s something that a lot of people don’t have access to,”
The potential for Ethereum in the long run is huge so 2020 is likely to be far more productive in terms of technology development and resultant token price than 2019 has been. Patience is the key for those holding ETH at the moment.
Image from Shutterstock