It is amazing to see how Ethereum’s price is holding its support at $200 less than 9 hours before the start of Bitcoin’s upgrade. In fact, Bitcoin’s price action is just as stunning. The way each is still holding their support with no major selloff right before the upgrade speaks volume for the strength of the Cryptocurrencies market.
For today’s update, we will cover a price action update as we have been doing during this countdown to Segwit for both Ethereum and Bitcoin. We will start with Ethereum first.
Ethereum’s price action update
As we are writing this article, Ethereum’s price is trying to break outside the descending channel. In yesterday’s update, we mentioned how it won’t take much at this point for Ethereum’s price to break outside this channel. We still think this is possible and we still stand by the long term Bullish forecast of Ethereum at $1000. The Chart below Shows where the price stands right now, just a few hours before the upgrade. We still maintain that to be back in an official Bullish mode, Ethereum’s price needs to break above $220 and trade above it for 3 days for confirmation.
In case there is any glimpse of positive news from Bitcoin’s upgrade, Ethereum’s price could easily continue on its uptrend that started earlier this year. Should the opposite happen and something goes wrong with Bitcoin’s upgrade, volatility is to be expected and what will actually happen is hard to predict. You will be looking at scenarios ranging from Ethereum taking over as an authority in the Cryptocurrencies ecosystem, to the whole Cryptocurrencies crashing because the market leader (Bitcoin) is struggling or crashing. That is without factoring in a potential hack or loss of funds that could make traditional investors concerned.
Understanding the current market reaction
The good news and what the market seems to be focusing on is the positive that should come out of this upgrade. It seems like investors are keeping an eye on the “Outcome” rather than the “Process”. The outcome being how the upgrade will improve on both Bitcoin’s Security by eliminating the possibility of external tempering with signatures which could lead to stolen coins as well as it’s scalability. Scalability is huge and here is why: Right now, Bitcoin has a small number of transactions per second (around 2.5 although in theory, it should be able to get to around 7 per second) compared to Ethereum (20 per second) Paypal (ave 193 per second). With Segwit2X, we will be looking at an increase to around 9. That’s definitely not as much as Ethereum or other payment services but it is nonetheless more than triple what the maximum transactions are today. Also, it is somehow unrealistic to compare Bitcoin’s transactions to Paypal or Visa for neither is a store of value like Bitcoin is.
In Short, the market seems to focus on the fact that Bitcoin should triple the number of its transactions per second, increase the security of those transactions and are not very concerned about the the issues that may arise. And that’s why this is a huge vote of confidence in the Cryptocurrencies in general.
Bitcoin’s price action
Bitcoin has been holding stronger than Ethereum during the month of July. As soon as the miners announced their intend to signal for Segwit, Bitcoin’s price took off and is hoovering around support near its all time high. As we write this article, the price is trying to break above support as we can see in the chart below:
We shall see what the developments are in the next few hours and share with our readers. so far, no hard fork detected:
The majority of Blocks are still signaling Segwit, BIP 91 is now active, BIP 141 Will be locking and Blocks not signaling BIP 141 will be rejected.
For more information
- For the terminology, follow the link to read our article published last week.
- Make sure you read what you need to know about the upcoming Segwit upgrade from InvestingHaven as well as this one about Bitcoin Cash, a potential outcome of Bitcoin’s upgrade.
