Ethereum (ETH) recently decoupled from Bitcoin (BTC) as its slide wanes slightly, but investors do not seem optimistic and many are looking at possibly a dead cat bounce.
The stock has not seen lows like this since May 2017 and some are pinning the downward pressure on founder Vitalik Buterin’s own comments. Buterin said that a 1000x price increase in the near future is unlikely. This caused some backlash and he was forced to clarify.
“To be clear, I never said that there is “no room for growth” in the crypto ecosystem. I said there is no room for *1000x price increases*. A 1000x price increase from today means $200T in crypto, or ~an entire 70% of today’s global wealth being in crypto.”
“What I *actually* said is that, because large portions of the population have already heard of crypto, further growth of crypto in any sense must come from *depth* (ie. actual usage), and not bringing in more attention.”
One of the differences for the token built to run what’s known as Ethereum’s world computer, is that some of the startups who used it to raise funds have begun to cash out. Startups spent 119,000 Ether on the week ending Aug. 29, the most since January, according to data gathered by research firm Santiment. However, this concern that startups have enough piles of ETH to crash the price.
In addition, Ethereum is seeing unprecedented competition – not to mention, the dApps and ICOs have not seen the mainstream adoption predicted – Buterin himself expressed frustration in this as well.
From the short-term point of view, ETH bulls desperately need to regain ground above $200 to get a chance for a more extended recovery. On the downside, ETH/USD is supported by $182,25 (SMA50, 1-hour chart), though the ultimate support zone lies at $178 (Fibo 61.8% daily), followed by $170.00 and Wednesday’s low at $166.76. Being grossly oversold after the recent plunge, Ethereum is undoubtedly ripe for a correction.
However, many analysts see the correction for Ethereum as a time to invest in other altcoins. Stellar, VeChain and XRP all have received notable partnerships recently and might be pushing for a strong run upward as Ethereum wallows in downside potential.