October 18th marked the day when bitcoin, Ethereum and others suffered a serious shock to their system. Ethereum prices dropped by 1/10th and bitcoin fell by almost 6%. Ether is the main cryptocurrency behind Ethereum and that reduced to below $300 from $340. Bitcoin also fell from a reasonable high of $5,550 to $5,380. It wasn’t just these two either, Bitcoin cash, Dash, Litecoin and others suffered greatly with more than 5% decline in their value. Ripple was the hardest hit with an almost 12.5% fall in value.
What’s Going On, Exactly? Why Did Cryptocurrency Surge in the First Place?
Ripple, Bitcoin and Ethereum were showing signs of developer activities in the past couple of weeks before they took a blow. They also overcame many obstacles and achieved milestones in development. Take the example of Ethereum. It was successful in completing the Byzantium hard fork. Vitalik Buterin, an Ethereum cofounder also said that the blockchain is more stable compared to its situation before after the fork was completed.
In the case of Ripple, it successfully partnered with the Bill and Melinda Gates Foundation. The Gates’ Foundation will now be implementing Ripple ledger technology to complete and settle mobile payments over the Ripple network. The Mojaloop, as it is called, is a mobile payments platform developed for the Foundation in collaboration with Dwolla, Modus Box and, of course, Ripple. Using this program, financial networks and banks in less developed regions, which have poor banking infrastructure, will be able to receive payments flawlessly.
As Shi Yaohong of Huawei put it, to realize the potential of mobile money, the “fragmented and complex” digi-payment systems must change. Mojaloop and other innovative solutions will help to bring banking services to poor and lower income customers.
Bitcoin was doing really well as it was in a good position to start rallying as investors from Japan, the US and other significant regions showed massive interest. SegWit2x hard fork demand subsequently dropped, however.
Support for the SegWit2x from larger mining pools such as the F2Pool has dropped. Even bigger bitcoin communities from Brazil, Argentina and South Korea had rejected the SegWit2X hard fork.
Supporters of SegWit2X would have to buy more bitcoin to get Segwit2X coins or B2X coins by end November. However most of the people investing and trading bitcoins at this point in time would invest in the cryptocurrency to show their confidence in the value of bitcoin over the short or medium term.
What Goes Up Must Come Down
Bitcoin, Ripple and Ethereum saw escalation in their value for the majority of 2017. Ripple was successful in getting the necessary partnerships with financial institutions like SEB Bank of Sweden. It has also had notable success in the form of the Enterprise Ethereum Alliance.
We saw a really great increase in the prices of cryptocurrencies where bitcoin went from $4500 to $5600 and Etherium went from $270 to $340, all in a matter of a fortnight. The cryptocurrencies were bought down due to a correction that will allow for market stabilization and structure. This is a momentary fall and will hopefully build momentum further in the future. We may see more rallying as well.