Over the last 24 hours, the crypto market has added $5 billion to its valuation, demonstrating a slight recovery from $106 billion to $111 billion. Despite the recovery of the market, Ethereum (ETH) and Bitcoin Cash (BCH) continue to fall in value, both recording a three percent drop against the U.S. dollar.
On December 9, the Ethereum price fell by around three percent from $97 to $93, failing to sustain the short-term momentum it garnered from an unforeseen recovery it experienced on Saturday. Since its daily peak, Ethereum has declined by more than six percent against the U.S. dollar, from $100 to $93.
Bitcoin Cash has also demonstrated a weakness in its short-term price trend as it lost nearly half of its value within a two-week period. Since November 6, the Bitcoin Cash price declined from $200 to $100, by exactly 50 percent.
The gap between Ethereum and Ripple, which recently took over Ethereum as the second most valuable cryptocurrency in the global market, has increased to more than $3 billion within a three-week span.
Technical indicators demonstrate oversold conditions but the sheer intensity of the drop in the price of the two cryptocurrencies have created a difficult environment for the two assets to recover or even maintain a low price range.
It is possible that as investors in the cryptocurrency market resort back to fundamentals, cryptocurrencies that have struggled to see a noticeable increase in accessibility, adoption, and usability are falling harder than Bitcoin.
Ethereum, for instance, as seen in the case of ConsenSys, the largest blockchain software company in the world, has been successful in creating an efficient infrastructure for decentralized applications (dApps) to a certain extent, but struggled to see much progress in Plasma, Sharding, and Casper, the projects three major solutions to scaling.
ERC20 tokens, most of which are based on Ethereum, given its dominance in the smart contract sector, have also failed to showcase products that can actually be used by casual users and the mainstream.
Seeing a clear lack of adoption of dApps and decentralized systems, Joseph Lubin, a co-creator of Ethereum and the founder of ConsenSys, said that the company will move forward and begin focusing on the development of products that can be utilized by users in the ecosystem.
Lubin said in an email sent to the company’s employees:
“ConsenSys 2.0 requires us to evaluate our endeavors more rigorously. We will seek to run leaner projects because often better decisions are made in a context of more constrained resources. Scarcity sharpens the senses and forces discernment in decision making. Lush plentitude, while perhaps a noble goal in many circumstances, should be hard won; otherwise it leads to complacency and dull-wittedness.”
Bitcoin Cash, a cryptocurrency with a large transaction capacity, has seen limited merchant adoption which it sought out for when it first launched in August.
With large-scale financial institutions like Nasdaq, NYSE, ICE, and Fidelity vowing to build infrastructure around Bitcoin first, the dominant cryptocurrency is expected to continue to outperform both major digital assets and small market cap cryptocurrencies throughout the bear market.
Featured Image from Shutterstock. Charts from TradingView.
Last modified: May 20, 2020 2:10 PM