Ethereum had a less than stellar Q3, intense 6 months ahead as ETH 2.0 looms – The Next Web

he plaBy now, you should almost certainly know about Ethereum, ETH the second largest cryptocurrency by market cap. But if you needed a quick recap, here it is.

Ethereums creators wanted to build a platform that would allow users all over the world to write decentralized applications, and use the Ethereum blockchain as a world computer.

The decentralized platform made smart contracts a key part of the blockchain conversation, and demonstrated to the world how blockchain technology can be used for more than just cryptocurrency.

It sounds great, but bringing the Ethereum vision to life is proving difficult for its community of supporters and developers.

One of the most contentious topics of the moment for the platform and one of its creators, Vitalik Buterin, is the transition to ETH 2.0. The series of updates and improvements designed to make the Ethereum platform faster and more reliable will not be implemented overnight. Its going to be a long process, thats due to commence next year, but wont be complete for many more months.

One of Ethereums founding members, Joseph Lubin, has said that the updates should make Ethereum far more scalable within the next 24 months. But of course, a lot has to fall into place for that fact to be realized.

Before we take a look at how Ethereum has performed in the third quarter of the year, lets remind ourselves how things went down in Q2.

In terms of trading price, Ethereum had a solid second quarter.

At the start of April,Ethereumexperienced a rally which saw its price increase by 27 percent from $139 to $177. Unfortunately, this uptick in price was short-lived by the end of April a market correction pulledEthereums trading price down to $150.

Thankfully, the correction didnt have a lasting effect on Ethereum, and over the course of May the digital coin showed nothing but steady growth. Over the four weeks of May, ETHs price increased a whopping 95 percent, topping out at just over $271 per coin.

Over the final month of Q2,Ethereumcontinued to grow. It didnt show the same pace it had shown a month earlier, but by the end of June,Ethereumwas up on where it was at the start of the month. As it happened,Ethereumreached its quarterly high trading price ($335) in June.

Over the course of the quarter, Ethereums trading price rose 114 percent. Not too shabby if youre holding on to ETH tokens for the long run.

Despite having a stellar Q2 and ending the previous quarter on a high, the same cannot be said for the digital coins Q3 performance.

From the first day of the quarter Ethereums price has proceeded on a steady downward trajectory.

Ethereumopened Q3 trading at around $285. The coin held steady around this price during the first week of the quarter. It even saw a 7.7 percent increase on July 8 as itsprice rose to $307 per token.

Unfortunately, that would be as good as it got for Ethereum at the start of Q3. By the third week of July its price started tumbling, a trend seen across a host of other cryptocurrencies and digital tokens.

By July 16, Ethereum hit $202, the lowest trading price for the whole month. This is a painful 34-percent drop over the high it saw in the first week of the month.

The cryptocurrency showed no signs of rallying to better things as it progressed into the middle of Q3. Over the entire month of August, ETH continued to drop in value.

There was a small uptick in trading price at the start of the month which saw Ethereums price grow from $211 to around $231, a 9.5-percent increase.

However, the decentralized token went into free fall for the rest of month.

At the end of August,ETH was trading for $166 per coin, a 28-percent drop from the high it saw at the start of month. Thinking back to the $307 quarterly high seen in July, at the end of Augustthe token had decreased by 46 percent in price.

Despite a slow and steady price rally over the first two weeks of September, the last month of the quarter proved to be just as cruel a mistress as the first two.

Ethereumopened September trading at a hair over $168. Over the next two and a half weeks, its price grew steadily eventually reaching $217, a 30 percent increase.

Unfortunately, the coins price didnt continue to grow or make up for its poor performance at the start of the quarter. The 30 percent increase seen in the middle of the month was erased almost immediately as Ethereums price dropped on September 20, it eventually settled at $162 a few days later.

Perhaps Ethereums sub-par performance in Q3 was a result of the lack of positive news for Buterins baby.

In August, Vitalik Buterin warned the community that his blockchain was almost full, and that a lack of scalability is proving to be a consistent bottleneck. Ultimately, it seems that keeping organizations from joining the network, isnt good for adoption.

Whats more, research from cloud service provider Chainstack showed that over half of Ethereum nodes are running on cloud computing services, such as Amazon Web Services (AWS).

Thats incredibly shaky news for a platform that positions itself as decentralized. If that wasnt bad enough, in early September Ethereum overtook Bitcoin in terms of daily fees. Perhaps a sign that Ethereum is struggling to deal with the volume of users.

That said, its not all bad news for the so-called world computer. Dapp developers still love Ethereum, even if it is lagging behind in active users, according to Dapp Radar.

There was also some good news for traders, as eToro announced the addition of five Ethereum-based tokens to its professional trading platform, eToro X. It also said it has plans to add a further 115 in the future.

The start of Q4 is already looking more positive forEthereum within the first two weeks of OctoberEthereums price reached $195.

A small market correction saw Ethereums price drop back down to trade between $160 and $180 for the following week.

The future ofButerins platformhangs in the balance, though. News that itsblockchainis struggling to deal with demands on its resources means the future looks uncertain at best.

According to a CoinDesk report published in Q3, Ethereum is facing challenges on all fronts. It doesnt just have to address its scalability woes, it also has to consider its future as money.

However, investors dont seem to be immediately worried about Ethereums short term future. It seems Buterin and co have doing enough to keep traders interested, for now.

With every passing week, we get closer to the planned launch of ETH 2.0. How that affects the long term functionality of the platform though, remains to be seen. But it might be time to grab the popcorn, because Q4 2019 and Q1 2020 are going to be interesting.

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Published October 23, 2019 06:43 UTC