Earler today, on October 3, the value of most cryptocurrencies in the market declined, as ethereum and bitcoin price dropped by more than 3 percent.
The price of bitcoin declined from over $4,430 to $4,280 within the past 24 hours and the price of Ethereum struggled to remain stable at the $300 margin, falling below $290.
Other cryptocurrencies including Ethereum, Ripple, Bitcoin Cash, Litecoin, Dash, NEM, and NEO also endured a minor correction, with some recording over an eight percent decline in value.
Factors and Trends: Bitcoin and Ethereum Correction
In terms of developer activity, adoption rate, scaling, and regulation, both bitcoin and Ethereum have outperformed the expectations of most analysts and investors. Earlier this week, the WSJ reported that Goldman Sachs, the $93.7 billion investment banking giant, is considering launching a cryptocurrency trading platform to serve institutional and retail investors in the finance sector.
A spokeswoman of Goldman Sachs reaffirmed that the bank is actively exploring various methods of addressing the growing demand towards bitcoin and the cryptocurrency market.
“In response to client interest in digital currencies we are exploring how best to serve them in this space,” the spokeswoman said.
The timing of the report by the WSJ on the mid-term plan of Goldman Sachs to operate a cryptocurrency trading platform could not have been more impeccable, primarily because Jamie Dimon, the CEO of JPMorgan, the world’s largest investment bank with a $342 billion market cap, publicly condenmed bitcoin and offered baseless criticism against the currency.
But, the bitcoin price is still struggling to recover beyond its all-time high of $5,000 that was achieved prior to the imposition of the nationwide ban on cryptocurrency exchanges by the Chinese government. It is likely that the imminence of the SegWit2x hard fork, a proposal to create yet another fork of bitcoin with a 1MB block size increase, is causing investors to speculate and lose confidence over the bitcoin market.
In the mid-term, the bitcoin price and market will likely be able to stabilize and sustain upward momentum as the Japanese bitcoin exchange market continues to grow at a rapid rate. Subsequent to the Japanese government’s authorization of 11 cryptocurrency trading platfroms, the bitcoin trading volume of the Japanese market increased significantly, securing 53.65 percent in market share.
In the case of Ethereum, there still is uncertainty surrounding the legality of initial coin offerings (ICOs). Earlier this week, the US Securities and Exchange Commission cracked down on two ICOs, filing charges of fraud.
But, in the mid-term, investors of Ethereum could be optimistic in regards to the development of various scaling solutions such as Plasma and Metropolis, which are set to improve the state of Ethereum significantly within a relatively short period of time.
Earlier today, Ethereum co-founder Vitalik Buterin clarfied that there will be no ICO for the development of Plasma.
“There will be no plasma ICO. There will be no plasma ICO. There will be no plasma ICO,” said Buteirn.
If the uncertainty around ICOs and the SegWit2x hard fork continue to affect the cryptocurrency market, it would be difficult for bitcoin and Ethereum to sustain upward momentum and increase to new highs. But, in consideration of the vibrant developer activity around the two cryptocurrencies, it is possible that that bitcoin and Ethereum could rise in value in the next few days.
Featured image from Shutterstock.
Last modified: March 4, 2021 5:00 PM