Inflection Point for Ethereum Technology?

Ethereum price has been falling rapidly since last few months. The year started with a big bang rise in price crossing $1000 in  second week January, 2018 and stood as the second -largest blockchain by total value.

Today, it holds a value around $200 and there are speculations on how well it will sustain against the technology of new altcoin like EOS.

While the chart below shows the trend in line with the Bitcoin (BTC), one might wonder, why Ethereum, a blockchain so much in demand owing to its uses in decentralised apps, Initial coin offerings and various new offerings would see this fall in price.

An Inevitable Slide

Even during the highs of the coin, while traders reaped benefits, developers and creators started discovering the limitations of this platform. Ethereum is not just a payments technology. It is created as a backbone to create more platforms. It is a developers’ delight but the end result is not so easy for the user. Or so has been discovered.

As described in a Medium post. by Fred Krueger, Editor or WorkCoin, first freelance working site on blockchain, mentioned how “unfriendly” Ethereum Dapps like Augur are not easy to use.

By mid-2018, reports of how scalability was an issue with apps. Many apps cropped up to cash on the hot run of money in these Apps with almost gambling like frequency and without any due diligence if the dapp did actually solve any issues.

While this increase in development increased new addresses on the Ethereum in geometric proportions, the growth rate has slowed down considerably. See the chart below. It shows a daily increase of 344,874 addresses on January 5, 2018. This number is now down to 46,879 as on October 10, 2018.

Developers and analysts feel this was an inevitable slide given the slowness in the user base.

Reflection in Ethereum Price

The above factors have reflected in the pricing of Ethereum along with challenges from other blockchain like EOS. EOS is showing promise of becoming the language of choice for apps in future. as described, EOS allows anyone to write the code and publish it and make it run on the blockchain without permissions. It is an application for various platforms. EOS is also more user-friendly.

Another is issue of scalability as is being discovered by many . As evidenced by many developers trying to download and build.

This is a major problem for inflation control and correctness.

Quite plausible that due to the lack of real full nodes on ETH a serious bug/exploit would be missed simply due to a lack of people who actually have a copy of the data. https://t.co/gRHbKTGOg0

— Peter Todd (@peterktodd) October 9, 2018

This serious fall in fortunes of Ethereum is beyond speculation. Vitalik Buterin has himself defended his blockchain on various occasions against predictors of doom of Ethereum. However, Ethereum might be set for a makeover with new version of Capser. Can it upgrade Ethereum beyond EOS and any new technology changes? That remains to be seen.