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Ethereum (ETH), the second largest digital currency in the world by capitalization, has finally exceeded an important threshold following a constant decline in value. The token lost another 7% at the start of the week to reach a minimum of $ 297, according to a Trust Nodes report. At the time of writing this article, the token was recovered a little, but is still trading under $ 300 for the first time in about a year. According to the report, ETH volumes are also falling, which could have something to do with falling prices below a crucial threshold.
The last time ethereum was priced below $ 300 per token was in August 2017. Since then, cryptocurrency has toured a rollercoaster with bitcoins and other major cryptocurrencies, rising to new highs around the start of the new year, but then in 2018. However, up until this week it had managed to stay at around $ 300 per token.
Unclear reasons
Cryptocurrencies often tend to move up or down on the basis of important news. In this case, however, there was no new note event that could drive the token below this threshold. Rather, it is more likely that it was simply the result of a business.
On the other hand, there are many other factors that may have contributed to the change in price: ICOs are apparently tending to cash in, the dollar is strong and the inflation rate for ETH is about 7%, according to Trust Nodes. However, each of these factors was present even when the token reached peaks of over $ 1,400. In other ways, the decline in the ETH price is a mystery. Google searches for "ethereum" have somehow increased in recent months and transaction levels remain robust and about three times as bitcoins.
All of this shows that it can sometimes be incredibly difficult to determine why a cryptocurrency (also a well established as ethereum) moves in the way it does.
Investing in cryptocurrencies and Initial Coin Offerings ("ICOs") is highly risky and speculative, and this article is not a recommendation from Investopedia or the writer to invest in cryptocurrencies or ICOs. Since the situation of each individual is unique, a qualified professional should always be consulted before making any financial decision. Investopedia does not make any representations or warranties regarding the accuracy or timeliness of the information contained in this document. On the date this article was written, the author owns bitcoins and ripples.
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