Ethereum

Ethereum Valuation – Constantinople – Improved Transaction Speed and ETH growth

January 25, 2019 Off Steven Anderson By Steven Anderson

The price of Ethereum is slowly gathering a bullish momentum versus the USD and the Bitcoin.  For a sustained upward move, the ETH/USD should settle above $120.

An average from the different cryptocurrencies across the world will give a near accurate price of Etherum, which was at $115.48 at the time of reporting the news.

There were a few positive signs in the yesterday trend lines above the $115 resistance in ETH/USD. However, buying failed to gain strength above $118.  The pair traded above $118 and $120 resistance points.

Yesterday, the ETH/BTC traded above the 0.0326BTC and 0.0328BTC resistance points.  This pair is now gearing up for improved gains above the 0.0330BTC resistance level.

The MACD indicators are in the bullish zone, and the hourly RSI shows a flat structure above the 50 levels.  A major support level is seen at $114, and the major resistance level is seen at $119.

Traditional valuation models cannot be applied to evaluate crypto. A company like Ethereum with actual cash flows can be valued in comparison to Visa or Mastercard.

With blockchain being a giant record keeping system, which everybody is permitted to use, if an investor has a digital asset on the blockchain, they can choose in which exchange the records are to be stored.  Immutability of transactions is the major advantage of the blockchain.

Reputation matters in record keeping.  If anyone who does not have a reputation is going to maintain the records, people might suspect of fraudulent activities. However, when the records are stored on blockchain with a reputed platform people will have more faith in the record keeping process.

The probability of corruption is less in a decentralized system, and trust is enforced in the record keeping process.  The total number of Ether incurred by the Ethereum blockchain can be inferred from the Ethereum blockchain.  The fee generating capabilities of the blockchain network contributes to the overall value.

The market cap of Ethereum and the information about the total fees collected which is the price to sales ratio will give a number.   However, this calculation will only provide a number that is above the true value of the Ethereum network. This is because of only miners profit from the fees and not the actual owners.

The on-chain transaction volume was at an all-time high in December 2018.

Diar reported earlier that when it comes to transaction counts, the supercomputer is stable ever since October 2018 with 16 to 17 million transactions in a month.  With Constantinople reducing the already low mining fees, Diar is of the opinion that price will not interfere with the growth of Ethereum. 

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