Bloody Monday has been a harsh start to the week for many crypto assets, including Ethereum. Bitcoin’s return to four figures has caused a digital avalanche for altcoins as markets bleed out over $35 billion in 24 hours.
Ethereum Crushed But Not All Bad
It certainly looks bad when the second largest crypto asset on the planet gets trounced by around 18% in 24 hours. Ethereum was trading at over $265 this time yesterday and now it is hovering around $225. A flash crash yesterday dumped ETH down to $190 but it did not stay there for long.
The following bottom was just above $200 according to Tradingview.com, and there has been little recovery back from that since.
ETH prices 1 hour chart – Tradingview.com
Ethereum recovered slightly to around $225 which is still down 27% on the same time last week. From its 2019 high of over $350, Ethereum has dumped more than 36% to current prices. Bitcoin by comparison has only corrected 25% from its high of the year to today’s levels.
The long term view from the depths of crypto winter is not as depressing. Ethereum spent a lot of time below $200 and since the beginning of the year it has made 66% to reach current prices. The collapse in recent prices has made the concept of holding enough ETH for a validating Ethereum node a lot more viable. Chief of Operations at tokenized real estate platform, RealT, David Hoffman, has pointed this out.
32 ETH for a validating Ethereum node, providing 5-12% more ETH yearly, costs $7,500 right now.
There can only be a maximum of ~3.5M distinct validators in our lifetimes.
Make sure you’re one of them.
32 ETH for a validating Ethereum node, providing 5-12% more ETH yearly, costs $7,500 right now.
There can only be a maximum of ~3.5M distinct validators in our lifetimes.
Make sure you’re one of them.
— David Hoffman (@TrustlessState) July 14, 2019
At current prices 32 ETH would cost even less, and if it drops below $200 again the token becomes a very attractive buy.
What Are ETH Validator Nodes?
The Ethereum 2.0 Serenity update, though a fair way off yet, will herald in a new consensus model which required validator nodes. A system chain called ‘beacon chain’ will be at the core of ETH 2.0. One of its functions it to store and manage the registry of validators. According to a ConsenSys article earlier this year, the only way to become a validator is to make a one way 32 ETH deposit contract on Ethereum 1.0.
Beacon chain will activate the validator status with exit being voluntary or for bad behavior. In return for staking 32 ETH, attesting to correct blocks, signing off on block validity, and proposing blocks the validator will be rewarded ETH from a network wide interest rate in addition to receiving some of the transaction fees.
Essentially the cheaper Ethereum becomes in the short term, the greater potential gain in the long term if the staking option is preferable to just trading. As with Bitcoin, price pullbacks are not always doom and gloom.
Will Ethereum price drop below $200 this week? Add your thoughts below.
Images courtesy of Tradingview, Twitter @TrustlessState, Shutterstock
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