Okay let’s be honest here. If I had to estimate how many people truly understand the
beauty of blockchain technology and cryptocurrency, I’d have to say that around 15% of the members within the digital asset space can comprehend a fraction of the revolution. In an analysis done by Sinclair Davidson, Jason Potts, and Primavera De Filippi, they highlight that blockchain technology in itself is a revolutionary technology in that “it undermines the strong case fo the economic efficiency of hierarchies (which exploits incomplete contracts) and relational contracting (which requires trust between parties) over markets. To the extent that blockchains can eliminate opportunism, they will be at a competitive advantage of traditional organizational hierarchies and relational contracts” (Davidson et al. 16). In fact, instead of looking at blockchain as a new form of general purpose technology, such as transistors, computers, internets, the authors argue that it might be best to consider blockchain as a “new species of economic coordination: governments, firms, markets, relational contracting,... blockchains” (3).
Despite this observation, let’s talk about what 85% (my personal guess) of the population who is involved in crypto is interested in: money. For now, the biggest piece of news that should affect the markets is the Ethereum London Hardfork. At approximately 12:34 UTC, Ethereum’s hard fork was live at block 12,965,000. And the biggest factor within the London hardfork is the EIP-1559 (shortened for Ethereum Improvement Proposal). All you need to know, is that EIP-1559 has four different types of improvements:
Although all four parts of this proposal are important in maintaining the integrity of the Ethereum system in general, the first point is what is getting everyone’s attention at the moment. What the first point means is that instead of increasing the ether supply in perpetuity, ether will now somewhat have a capped supply much like Bitcoin. In fact, the London hardfork is just one step to the deflationary model that will be capitalized when the proof-of-stake (PoS) consensus algorithm finally kicks in. In fact, once PoS is fully implemented, the projected rate of issuance is 0.4%.
As one reddit user u/chapogrown indicates, this issuance drop will be deducting 90% of issuance, which is equivalent to 3 Bitcoin halvings (this drop in issuance is sometimes called the “triple halving.” Because of this, many cryptocurrency pundits as well as data aggregators have suggested that Ethereum could have a very similar bullrun to what was seen in Bitcoin’s cycle in 2016 - 2017 in the coming years, maybe even coming months as there are only 4 months needed to close out this year. It definitely makes sense because during this cycle, there is a lot more institutional capital flowing into the digital asset space every passing day (i.e. there’s news about Michael Saylor buying 100s of million dollars worth of Bitcoin). In addition, crypto adoption across nations such as El Salvador is a small step, but it is a step toward the right direction that will help cryptocurrency gain more traction. However, I would be lying to you if I knew what price Ether could get to. In fact, everything you read, always take it with a grain of salt. Ethereum definitely could blow past it's all time high in the 4000s within the upcoming months, but we’ll see. What everyone can agree on is that cryptocurrency, especially those that have an essential use case, has a very promising future in the long run.
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