When you look at cryptocurrency trading charts on this second day of January, there’s a clear winner.
Bitcoin is still under the $4000 mark, but Ethereum, one of the other most closely tracked coins in the sector, is up to around $150.
This is big news. ETH has been gaining steadily and gaining big.
Now, analysts are exclaiming that Ethereum has overtaken Ripple (XRP) as the second biggest cryptocurrency.
But you might accuse some of burying the lede – which is that Ethereum has actually doubled in the second half of December. With high marks above $150, ETH is showing tremendous growth in a short period of time.
“Whenever you’re looking to invest in any cryptocurrency, it is a much better idea to look at the option of Ethereum,” writes Andreas Kaplan at Smartereum today. “When you look at the option of Ethereum, you would realize that not only it has a strong application, but also significant potential for appreciation.”
With that in mind, we still have to look at whether or not the rally will continue, or whether a huge correction will occur. Keep an eye on places like Consensys where just a couple of weeks ago, the headline was that the organization would be laying off more than half of its staff. With recent ETH price gains, you should see these headlines turnaround. If not, the gains might not be genuine.
There’s another big issue that no trader investing in Ethereum should overlook right now.
The hard fork event is one of the most mysterious parts of the cryptocurrency world. It’s tremendously important that this month Ethereum is due to experience no less than three hard forks: the classic vision hard fork, the Ethereum Nowa fork, and the Constantinople fork.
There are rationales for these forks, and various rewards, but the news makes some traders abundantly nervous.
Bitcoin Cash is a case in point – while the split was supposed to benefit the cryptocurrency, the subsequent controversy made a negative ripple effect through the market as uncertainty ate away at investors.
If any one of these hard forks becomes like that, it’s going to drag prices down. But more than that, it’s going to cause additional confusion.
In some ways, experiencing a hard fork is the cryptocurrency’s version of going down Niagara Falls in a barrel. If you make it, you have visibility, tremendous bragging rights and a huge upside. If you don’t – well…
The bottom line is that ETH is grabbing attention by rapidly increasing its price. But you don’t want to expect that to just continue into the near future with these hard forks coming up. Instead, do research on the forks and understand what they mean, so that you’re ready on day one to roll with an often volatile market.