Hard Fork Ahead: Will Ether Sustain its Lead Over Ripple Amidst Plunging Cryptocurrency Prices?
The price of Ether plunged further today to trade at $975. This second largest cryptocurrency is not alone in the downward trend, the widespread cryptocurrency crash has affected almost all cryptocurrencies in the market. But this isn’t the only reason why Ether's price is experiencing a sharp drop. The upcoming hard fork could also be affecting its value.
Anton Mitrohkin, CFO and Co-founder of Descrow, says, "The price of Ether is influenced by the expected hard fork on January 19. In general, after this date, you can expect a rebound in the price of Ether. Then it will be possible to judge the real value of these crypto-currencies and their place in the world ranking."
Days after Ethereum's market capitalization surpassed that of Ripple on the coin market, the cryptocurrency traded at an all time high price of $1375 on January 10, having surpassed the $1000 mark the weekend before. Though the currency's price has experienced ups and downs since last week's all time high, it traded safely above the $1000 mark until today when it's price dropped to $975 on CoinMarketCap.com.
But even with this drop, Ether continues to enjoy a positive outlook from industry players. Jameel Shariff, CEO at P2PS, says, "Ether's intrinsic value is much more than its current market cap although Ether has run up quite a bit. We can expect Ether to go beyond $1750 in the next few weeks due to the growing prominence of the smart contracts usage in all the ICOs & beyond."
But not everyone sees a bright future for Ether, some players in the industry hold a different view based on previous performance of Ethereum's blockchain network.
"Ether is obviously very much overestimated and in the near future the price should fall. Strong network congestion, the high cost of transactions, the recent fall of the network under the onslaught of the game of crypto-kitties all indicate that the network is going through difficult times," adds Mitrohkin.
Towards the end of December 2017, the market capitalization of Ripple stood at $86 billion, surpassing that of Ethereum which stood at $73 billion. Ripple held the the second largest cryptocurrency position after Bitcoin for nearly a week. Ethereum rose back to second place after the price of Ripple dropped by about 25% a week ago to trade at $2.50. At the same time, Ether's price rose by about 2.5% to trade at $1,155.
Even so, we’re likely to witness more competition between Ether and Ripple, causing them to switch positions in future as Opporty.com founder, Sergey Grybniak, observes.
"I think there will be a few more switches in their positions. However considering Ethereum development progress, Proof-of-Stake, DAICO, and others, it will be pretty tough to compete with it," he says.
Comparing competition between the two cryptocurrencies, the Managing Director for LDJ Capital Investments, Shaun Dindial, says, "I believe ethereum will see a steady consistent rise in price. Ripple exploded in the past few weeks so we will watch to see what happens in the short term, but Ripple is here to stay so long term it is still a good hold."
Industry players remain positive that beyond the widespread cryptocurrency price plunge, Ether's price will continue in the upward trajectory in the foreseeable future. Yale ReiSoleil, Co-founder and CEO at McAfee says, "Once ETH goes above $1,256, we'll be in a short rush to $1,500, and we'll have a long term hold of it."
Whether Ether survives the crash or the scheduled hard fork remains to be seen.
Disclaimer: David Drake is on the advisory board for most of the firms mentioned or quoted in this article.