18 June, 2018
Players in the crypto space are beginning this week like they have the many weeks prior – hoping that there are catalysts that will move cryptocurrencies' prices higher. For one crypto in particular, Ethereum, there are some specific happenings that could play in its favor. Bitcoin guru Brian Kelly pointed them out recently.
Let’s discuss them.
One of the catalysts that could move Ethereum’s price higher relates to Augur. It’s one of the oldest ICOs, and has been in development for about two or three years, Kelly said.
“It’s a decentralized prediction market. What's interesting about this [is that] this will probably be one of the biggest decentralized apps on top of Ethereum. If [Augur] doesn't slow the system down, that can generally be a positive for Ethereum.”
We recently reported that Augur had suffered a price slide just as the launch of this distributed app on the Ethereum network was announced. We noted that it was the nature of the product that was causing it troubles.
Futures to the rescue
Last week, the U.S. Securities and Exchange Commission announced that it would not regulate Ethereum and Bitcoin as securities, essentially clarifying that the two cryptos were not securities.
The clarification is exactly what is needed to pave the way for Ethereum futures.
Kelly noted that the president of Cboe Global Markets said that the non-clarity was a hurdle for launching Ethereum futures.
"So one would think, perhaps, Ethereum futures are not far off. They already have an Ethereum index."
It’s worth noting that after the SEC announced that Ethereum was not a security, its price rose as much as 9%.
Ethereum miners are looking forward to upgrades that are thought to be more catalysts to moving the crypto’s price higher.
Kelly said the following about the move.
"They [will] go from hardware mining, proof of work, to something called 'proof of stake,' which is similar to a software mining."
On another note worth mentioning about mining, Kelly spoke about the costs. Currently it costs about $5820 to mine Bitcoin. Bitcoin’s price at the time of writing was $6,455. Observers who are HODLers wonder how concerned they should be as the price of the crypto nears the cost to mine one Bitcoin.
Kelly said the following about this worry: “If we get below that [$5,820] level, miners will start to turn off their rigs. But that doesn’t mean that supply decreases. [As far as BTC supply is concerned], every 10 minutes right now, you get twelve and a half Bitcoin. There could be an incentive for some of the bigger miners that say ‘I’m not going to sell every 10 minutes; I’m going to hold on to it.’
So it’s something I’m watching very, very closely because we haven’t seen this in this market, at least not to this magnitude.”
Ethereum has been trading a little bit better than Bitcoin in terms of relative value, Kelly pointed out.
“If you’re long this market, I would be overweight Ethereum.”
Kelly expects these catalysts to pan out over the next few of months. So look for the impact of each to take effect before the end of the year.
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