A new pet Doge?After a long history of flirting with Bitcoin, the infamous Elon Musk is turning his attention to Ethereum, making friends with the founder in a new bid to build up his pet Doge.
Ethereum has had a rollercoaster ride since the crypto crash hit the market a few weeks ago, driven by Musk and his all-powerful Twitter account, as well as some regulatory crackdowns that sent digital currencies into a tailspin.
The currency plummeted from highs of $4,000+ to below $2,000 in less than 10 days, and has had a volatile ride of weeks since then. China has been a big influencer, playing a key role in the crypto sell-off a few weeks ago and making things worse this week when its biggest social media platform, Weibo, banned a bunch of big crypto accounts.
But hope is not lost, because the Market-Moving Musketeer (see what we did there?) has shifted his attention to Ethereum, buddying up with co-founder Vitalik Buterin to potentially boost up joke currency Dogecoin. If it actually happens, it has the potential to send the crypto market absolutely batshit crazy.
Ethereum last year finally began the upgrade that will (hopefully) deal with frustratingly long wait times and high fees, but it could take a good few years to come through, with a slew of growing digital currency rivals vying for market share in the meantime. As another way to possibly build Ethereum momentum, Vitalik and Musk have agreed that Ethereum could take Doge to the next level.
Well, we’re excited.
Another crashThis week's crypto crash left no digital currency unaffected, least of all Ethereum, which fell almost 30% on the back of China’s crypto crackdown.
In China’s latest attempt to reign in its growing digital trading market, it has now given warning to investors against speculative crypto trading and banned all financial institutions and payment companies from providing services related to cryptocurrency transactions. The country has already banned all crypto exchanges and coin offerings, although it hasn't yet stopped individuals from holding cryptocurrencies.
Almost every digital currency took a nosedive this week - Elon Musk's favorite joke currency Dogecoin lost around 30%, while Bitcoin saw lows of $30,000 after tinkering around $60,000 only a couple of weeks ago.
Luckily, all three saw double digit rebounds yesterday though, so don't panic just yet.
Ethereum loses out in crypto crazinessEthereum logs its first weekly loss since March as cryptos go crazy under the thumb of Grand Master Elon Musk and his tweety minions.
The cryptocurrency, which was trading at around $200 this time last year, shot past the $4,000 mark to reach a high of $4,380 earlier this month. But it looks like there might be a chink in its armor, as a crazy crypto week sent its prices stumbling back down past $3,000 on Sunday. Our real world Iron Man, Elon Musk, got tapping on his official Twitter account last week to take a bite out of Bitcoin. As tends to happen in the crypto world, other currencies got pulled into the firing line and around $375 billion was wiped off the the value of the whole cryptocurrency market. Godammit, Elon.
Investor interest in Ethereum has surged recently though – as of May 10, its market cap was nearing that of JP Morgan Chase, which is valued at around $474 billion. One person who’s seen some serious wealth off the back of the surge is Vitalik Buterin, the world's youngest known crypto billionaire and the co-founder of Ethereum. Born in 1994, he founded the currency after taking an interest in the Bitcoin boom, seeing the decentralized system as a way to encourage a “great wealth distribution” when he wrote Ethereum’s white paper at just 19. Redistribution of wealth indeed – he’s now worth well over $1 billion, so guess that particular redistribution worked out in his favor.
While Bitcoin is known as a peer-to-peer payment system, Ethereum can do more than just transactions: it can build and power decentralized apps and financial tools or NFTs – the current boom in which is a big contributor to Ethereum's recent trip to the moon.
The network is called Ethereum and the native currency, just to clarify, is called Ether. Once in Bitcoin’s shadow, Ether has seen some serious surge this year - BTC sunk 2% in April while Ether’s value soared over 40% against the dollar. On the back of growing interest in the space, the crypto market is currently worth about $2.5 trillion: and between them, Ether and Bitcoin account for about two-thirds of it.
But the underlying blockchain tech of Ethereum is not without its own controversies, and has been called out on the climate change front before, so investors could be a bit more cautious since Musk made headlines with his concerns over the environmental impact of Bitcoin mining.
said John Kramer, a trader at GSR Capital.
Pop it and drop itEthereum, the world's second-largest crypto currency, cranks through the $4k mark for the first time ever before sinking back down to $3,655 and closing the day at $3,950. A year ago, it was trading below $200. That’s some serious surge.
Ethereum officially sailed past the $4,000 mark after a stunning rally this year, popping to highs of $4,200 before dropping it back down, reaching a market value of $483.4 billion. That’s only half of the value of rival Bitcoin’s $1.09 trillion, and let’s not forget that in April Ether gained over 40% while Bitcoin dropped 2%.
The currency is making its mark partly thanks to its growing popularity in the DeFi movement – which aims to recreate traditional financial products with blockchain tech - as well as the digital collectables trend (also known as NFTs, or non-fungible tokens) that have exploded in popularity recently. NFTs are basically digital assets designed to represent ownership of virtual items like sports memorabilia and art, and a lot of them run on Ethereum. Ever heard of CryptoKitties? Yes, it involves buying and selling fake cats online. No, we’re not kidding. And prices can reach over six figures 🤯
As nice as it is for Ethereum to be the fake-cat financing tool of choice, the surge in activity is also causing some congestion on the currency’s network. Around seven million new Ethereum accounts were created in the first four months of 2021 alone, taking the total to over 55 million, with the total dollar value of each transaction on the platform coming in at over $1.5 trillion for Q1 - more than all of the previous seven quarters combined. The network is unsurprisingly facing some congestion and its rising transaction fees have led to more competitors entering the market, driving concerns around the environmental impacts of cryptos.
But still, it looks like Ether’s payoff is starting to match up to its promise. On the back of growing interest in the field, the entire crypto market is now worth around $2.5 trillion. That’s a lot of fake cats.