Welcome to the 19th crypto roundup, brought to you by HEAT.
Ethereum and ICOs
As the price of Bitcoin has taken a beating, mostly due to the scalability divide in the community, Ethereum continues to do well. It has touched the magical $50 per ETH with a total market capitalization of excess of $4 billion. It is now a serious competition to the dominance of Bitcoin itself.
One of the major reasons for this rapid rise of Ethereum has been the utility of the platform itself. Ethereum is not being used just as another currency. Instead, many new products and projects are being created on Ethereum. This adds value to the entire Ethereum ecosystem. Even the infamous The DAO hack didn't undermine the utility of ETH to new projects.
Case in point, just this week, we have a few major ICOs and most of them are ICOs of projects built on Ethereum. WeTrust, a social peer to peer lending platform, is built on Ethereum. Joberr, which recently concluded the first phase of its ICO, was an Ethereum token to build a Fiverr-like marketplace for Ethereum. TaaS (Token as a Service) is an Ethereum token for a closed-end fund management for cryptocurrencies and crypto-assets. They have already raised more than $1 million in the ICO. Finally, we have Lunyr, an Ethereum token used to power a knowledge network of contributors and editors.
All this is not to say that these projects will succeed. Far from it. But Ethereum has opened up a new way for projects to experiment. Most of the above will likely fail. However, with the rapid experimentation, the winning economies become even larger. The winner takes all effect becomes more pronounced in the crypto-world.
The largest project built on Ethereum today is Augur, which is a decentralized prediction marketplace. Today, it is valued at more than $100 million. We are still waiting for the first 'unicorn' startup to come out of Ethereum (of course Ethereum is already one, but no project built on Ethereum has achieved this feat). Maybe it's Augur and maybe it's something else. But it seems more a matter of when rather than if, a big improvement since even a year ago.
Bitcoin Drama and Its Wake
The Bitcoin drama continues with the threat of a hard-fork and the division between Bitcoin Unlimited and Bitcoin Core.
This has had some unintended consequences. For starters, Bitcoin's share as a total fraction of the entire cryptocurrency market has tanked. Business are seriously considering moving from Bitcoin. Storj, one of the larger decentralized storage applications, has already moved from Bitcoin to Ethereum because the fees became too high.
Litecoin, with rumors of SegWit activation likely, has surged over 50% in just one day this week. Here's a 7-day chart to show this jump:
Scalability is still challenging, even for Ethereum
Let's not count our chickens before they hatch. Scalability on blockchains is a serious issue, and will continue to be challenging. Projects like HEAT have built impressive solutions, keeping scalability in mind from the very beginning when the project was conceived and designed. However, even Ethereum doesn't have these features. Sure, the future may see adoption of proof of stake and sharding on Ethereum, but that's going to take a while. Meanwhile, Ethereum is far younger than Bitcoin, and there are concerns around how well it can scale. Some projects are moving away from paying dividends to tokenholders because it costs too much (such as ICONOMI most recently, among other reasons).
In the long-run, highly scalable blockchains will likely be better for investors. Check out HEAT if you haven't already. The testnet has already reached parity of scale with Bitcoin, with much more to come in the future. The mainnext launch is imminent, with forging rewards to come to the holders. For those in it for the long haul, these technologies should definitely be appealing especially on scalability.