Ray of Hope as Ethereum’s Criticism Mounts
Ethereum has come under intense criticism of late particularly as its asset’s price keeps dropping in value. However, it is too early to conclude that the belief in its network is actually falling or that its value would drop to zero for new platforms like EOS, NEO or ADA to be considered as better alternatives.
Currently at $185 on Sept. 11, some enthusiasts predict a continuing downward trend for ETH whose price is back at its May 2017 range with its transaction and wallet numbers reportedly sliding.
Mining ETH is already being criticised for being unprofitable. From indications, the proposed block reward reduction coming later will make the profitability even lesser for GPU miners who have secured the network from its early days. A negative revenue for GPU miners will see ASIC miners take over for their industrial power rates.
This development may hurt investor confidence since Ethereum has always maintained ASIC-resistant and pro-decentralisation. A reduced block reward will push the network towards ASIC mining and eventually increase centralization.
A clearer roadmap from the Ethereum Foundation, developers and other stakeholders would help change the outlook especially as there seems to be no date set for the hyped switch from PoW to PoS which has been suggested would be done in two phases.
Ray of hope
The proposed Constantinople fork is expected to make it easier to implement state channels on the platform. This will allow a lot of transactions, mostly consumer dApps, to be moved to Ethereum’s layer 2 while 1st layer remains for settlement.
Also, the Winklevoss Brothers just launched a tokenized USD on the Ethereum platform. The idea is to create a stable fiat token that will serve as a bridge to widespread crypto adoption – make people feel comfortable with crypto at a transition point. The stability will help address volatility which makes using crypto for businesses a bit risky. With more business cases made, more dApps are likely to be launched on the Ethereum platform.
As a US-based company (answerable to U.S. authorities and in compliance with regulations), the Winklevoss Brothers’ GeminiUSD will help businesses allay fears on trust issues as a third party and a central authority with a likely point of failure. If exchanges start to adopt GeminiUSD, it could be the end for Bitcoin-backed Tether which has many controversies especially with regards to auditing. Ethereum’s hope of a rise could be made alive until proven otherwise.