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Why Ethereum Falling Is a Good Thing

Written by Alexandra Perry
Posted May 26, 2017 at 4:36PM

Two years ago, Twitter was struggling.

Hot off its IPO, the company was grappling with explosive user growth — growth that crashed servers and had its tech team scrambling.

These technological hiccups cost Twitter users. In general, people are impatient. All it takes are a few errors for them to delete an application or abandon a commitment.

Twitter rode out those bumpy months, improving its framework. It now offers a far more advanced social network for users.

Today, this is happening to Coinbase.

Coinbase Is Part of Ethereum's Struggle

After a $20 surge in price, Ethereum tanked hard. It dropped from a high of $214 to $160. 

The currency's fall corresponded with continuous issues from cryptocurrency exchange Coinbase. Coinbase crashed multiple times. If you are trying to set up an account, you will likely have problems with your credit card authentication. Payments and transactions are taking longer.

Users are furious, taking to social media to lambast Coinbase. Ethereum and Bitcoin have responded as expected, dropping in value as people panic sell.

Coinbase's users have a right to be frustrated — especially since there is so much money on the line.

But, believe it or not, Coinbase's issues are a good thing. They signify explosive growth in the digital currency sector.

The company has added thousands of users in the last couple of days. It now has 7,200,000 daily users.

Ethereum was up almost 150% in the past two weeks; Bitcoin has grown by over $1,000 in the past month. Novice investors flooded the market, trying to capture these gains.

This was a recipe for disaster for Coinbase, which previously catered to a small, experienced investor pool.

Now they have to scale to keep up with user demand.

Why Ethereum's Price Dropping is Good

Growth is always good. The fact that more investors are moving into Ethereum and Bitcoin is good. The technological hiccups these platform experience along the way are just speed bumps, warning us that digital currency is moving a bit quickly.

Celebrate Coinbase's issues instead of being alarmed.

This drop in price is a good thing. It offers devoted Ethereum investors a chance to buy low.

Every time Coinbase has an issue, inexperienced investors panic and that initiates waves of panic selling. This is the equivalent of someone jumping ship when they see a drop of water on deck, not knowing whether it's rain or if the boat is actually sinking.

Bottom line: If you sell now, you are going to lose.

The smart investors are sitting in the background, holding and waiting for the dust to settle.

So, don't shoot yourself in the foot. There is nothing wrong with Ethereum. It's the same technology that enchanted massive corporations and tech companies.

The only thing that has changed is the volume of people acquiring Ether, and the exchanges will have to adapt and improve to meet this need.

Buy low, sell high, and don't be a victim of panic selling.

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