The price of the Ethereum #cryptocurrency has risen over the past two years. Those who bought the currency in 2015 and 2016 and still have possession of the coins have made huge profits as compared to investors of stocks and government securities. Although the prices of cryptocurrencies have risen in the past, many call this increase a boom that is about to burst, while others have predicted that prices will continue to grow.
The Ethereum boom
The Ethreum cryptocurrency was introduced on July 30th, 2015. Its cryptocurrency coins are called Ethers. It is the second most valuable cryptocurrency by market capitalization after Bitcoin.
Its #Market Capitalization is U.S $35.2 Billion while its current market price is $381. Currently, 92.4 million Ether coins are in supply. When Etherium was first introduced to the public for trading, buying and mining back in July 30th, 2015, its price was $2.83. The price has risen by 13,300 percent. One million dollars worth of Ether coins on July 30th, 2015 are now worth 112 million U.S dollars. On January 1st this year, one Ether was worth $8.24, it has thus increased in price by 46 times to the current $381. Its price has also increased by four times in the past month.
— Chris Burniske (@ARKblockchain)
Why the price of Etherium is rising
The main reason why the cost of Ethers is growing is that the price of its competitor Bitcoin is too high. The current price of one Bitcoin is $2,771 as compared to the cost of an Ethers which is $381.
The price of cryptocurrencies determines purchase decisions by small or minority investors. Another reason is speculation, where investors want to profit from the price boom. Previous profit records from stocks and government securities cannot be compared to gains investors or buyers of cryptocurrencies have made in the past. Their prices are also rising because their supply is fixed and this is making mining of new coins harder to achieve. Thus once a certain amount of cryptocurrencies such as Ethers are created, the creation of new coins will stop, and prices will rise. Cryptocurrencies are also not affected by inflation or the performance of an economy.
The future of cryptocurrencies
There is the lack of government support for cryptocurrencies as they are not created or regulated by a central government. However, a country such as Russia is supporting cryptocurrencies such as Bitcoin. According to Bloomberg, Russian President Vladimir Putin met with the Etherium founder #Vitalik Buterin. A central authority might be set up as the acquisition of the currencies by members of the public has already been proliferated. The authority might limit the creation of new cryptocurrencies. It might also monitor incidences of fraud in the cryptocurrency market as well as offer guidance to the public about the currencies.
Benzinga: Vladimir Putin Meets With Ethereum's Founder https://t.co/s9mdcWf46C— TradeWithSuper (@TradeWithSuper)