Ethereum Is Dropping: Here's Why
Ethereum Was Flying
There's no other way to describe a $140 price leap over a weekend.
On Friday, I was hopeful that this would happen. I warned that if we broke $280, it was off to the races.
But even I was surprised when Ethereum crashed through $320 like paper. Then we hit an all-time high of $420 at 6 a.m. this morning.
Then growth halted. Ethereum's price is now rocketing downward.
Let's take a second to talk about why this is happening and why this is no time to sell.
Panic Selling and Coinbase (Again)
Well, it's happened again. Coinbase is down. And, just like last time, this has initiated a wave of panic selling.
GDAX, another digital currency exchange, is also down.
The source of these outages is obvious. In the last few days, Ethereum has been scooped up in unprecedented amounts. This trading volume puts a strain on digital currency platforms that are still adjusting to a massive influx of users.
Coinbase is making strides toward improving security, but its system still has issues with this high of a level of transactions.
Regardless of what the platforms do, downed systems cause panic selling across other platforms and from users able to get into Coinbase.
Ethereum Is Correcting
Ethereum's correction was long overdue. In fact, every time the currency dropped $20 in the last day, I was sure that this was it.
The last time Ethereum surged like this, it had a 50% correction shortly after. The time before that, it had a 45% correction.
More money than ever is also on the table, making investors antsy to sell.
Corrections aren't a cause for concern as much as they are a symptom of overbuying in the space. They do not affect Ethereum's long-term potential.
So, think twice before you sell and try to buy back at a lower price. For some people, this works. Personally, I don't gamble with a volatile market. Buy on dips and hold.
Either way, brace for the correction and just be glad to see movement in the Ethereum market.
A Hopeful Note to Those Who Are Holding No Matter What
To many Ethereum investors, holding is the name of the game. These investors are going to hold straight up to $2,000 or whatever obscene heights Ethereum will reach. Day traders will do what they will. But most people are locked in on long-term profits.
But for those of you who are teetering on the edge, know this: There are a lot of reasons why more booms are coming.
And the big reason is adoption.
In the world of digital currency, adoption is key. Well, in the world of tech, adoption is key.
Without adoption, a technology will flounder and die. And Ethereum is being adopted at a breakneck pace.
New Zealand announced plans to add Ethereum to its digital currency exchanges. Russia announced that it would be using the Ethereum blockchain in its business structures. China came forward and announced the development of a digital yuan, based on Ethereum. And the United Kingdom is developing its own digital asset that will back gold.
And Ethereum is only two years old.
Want me to tell you what Bitcoin was doing at year two of its life? It wasn't worth anything. It certainly wasn't getting attention from national governments, banks, and tech giants.
Bitcoin forged the way for Ethereum to skyrocket early in life. And after seeing one digital currency succeed, investors are more confident.
After all, who doesn't look at Bitcoin's lofty near $3,000 price tag and wish they had taken a piece of that pie?
Big events are coming down the pike. We try to keep our investors up to date so they can buy before major rallies.
So, stay tuned for updates.
Editor's Note: A lot of people ask questions in our comments section below. Feel free to tweet me at @AlexandraPerryC with questions or topics you would like addressed. I will try to supply you with timely information on article inquiries. Best of luck with your investments.
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