Ethereum ETH/USD Reclaims Throne as Second Most Valuable Cryptocurrency – Here’s Why 2142

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From $83 to $155 in 30 days. It took an 86 percent price increase for Ethereum (ETH/USD) to reclaim its throne as the second most valuable cryptocurrency in the market edging out Ripple (XRP) and dragging the rest of the market up in the process. No easy feat.

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Trials And Tribulations

2018 was a brutal year for cryptocurrencies with most suffering losses of up to 98 percent. Ethereum (ETHUSD) was no exception with its own set of roadblocks. The combination of bearish market sentiment and suffocating ICO projects that used ETH as a primary means for raising funds were forced to sell which meant that the road to price recovery would be twice as long.

February 10th, 2016 – Ethereum became the top-two cryptocurrency by market capitalization and since then held its ground throughout most of its lifecycle, only being knocked down briefly by rogue market fluctuations.

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Currently, as of November 16, this has been the longest stint for ether spending 46 days in third place since it was overtaken by XRP.

The ol’ Hard Fork Play

History has shown – hard forks can be very profitable.

Ethereum’s price increase is most likely to be attributed to the recently announced Constantinople hard fork; a process which essentially splits a cryptocurrency in two. The update is set for January 16 with the result being a decrease in block time; an attempt to improve scaling by making the network faster as well as the reduction of mining rewards which will fall from three to two ether.

Quite a bit of money goes into any cryptocurrency that is set to fork. The demand is fueled by speculators who will try to capitalize from receiving the additional forked coin and what essentially is seen as “free money”. It is not uncommon for the forked cryptocurrency to go back down in price soon after the fork has been completed and all coins are claimed.

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We’ve seen it happen many times before with Ethereum/Ethereum Classic (ETC), Bitcoin (BTC) and Bitcoin Cash (BCH) and the most recent example being the Bitcoin Cash ABC/Bitcoin Cash SV split.

A Sign of Things to Come For ETH

The hard fork is thought to be a key component for transitioning from using a proof of work (POW) protocol to proof of stake (POS). Ethereum has always had the luxury of having some of the brightest blockchain minds on its side, so hard fork or not, the recent price increase is more of an inevitability than anything else. With that, the crypto Christmas rally rolls on.

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