Last week, Ethereum (ETH) dropped below $200, which led some to believe that cryptocurrency’s bull market is over. Placeholder partner and crypto investor Chris Burniske feels that ETH is experiencing its first bear market, synonymous to what Bitcoin (BTC) went through in 2014/15.
Burniske noted that 2014/15 was one of the best periods to consider investing in Bitcoin. He adds that the cryptocurrency’s momentum was definitive regardless of the bearish price action. He says what happened then to Bitcoin is happening now to ETH.
Ethereum Still Faces Unresolved Issues
Yesterday, Changpeng Zhao, the founder of Binance, seemed to share Burniske’s sentiment and took to Twitter to join the conversation started by Vitalik Buterin that the Ethereum blockchain is virtually full. Zhao said in a tweet that speed and capacity was an issue last year, but it has been solved for newer blockchains. He added that there is need to add real applications that can be used by people to reach new limits again.
However, Buterin indicated that scalability challenges are not solved at all, adding that even the new semi-centralized distributed ledgers are only able to process transactions per second in hundreds. He noted that, for instance, EOS has faced scalability issues already. The Ethereum co-founder said that he was pessimistic about second layer scalability solutions, such as Lightning Network, which enable users to directly transact between off-chains.
Currently, Ethereum, the second-largest cryptocurrency in terms of market capitalization, is trading at $183 on Bitifinex, which is a 7.3% drop within a day. Last week, the crypto lost 10.18% and closed at $194, which is the lowest weekly close under $200 since May. With the $194 close, the cryptocurrency debased the uptrend from the December lows.
The eight-month growth channel has been broken to the downside, which is a sign that the bullish market is changing into a bearish trend. However, there is optimism that Etheruem could reach $1,000 again. In the near term, ETH expects support levels at $170 and $150 to come in play at any time.
Featured image: DepositPhotos © sadsadang