Ethereum Is Up 16% this Week as Golem Launches on Mainnet
After a difficult first quarter, Ethereum is finding its groove again. The world’s second-largest cryptocurrency by market cap is up 16% this week on improved sentiment and signs of a technical reversal.
ETH/USD Price Levels
The price of ether rose 3.5% on Thursday to $435, its highest since Mar. 28. The cryptocurrency has now gained 16% over a five-day stretch and 22% from the yearly low.
Ethereum recently followed bitcoin into ‘death cross’ territory, which refers to a bearish reversal between the 50-day moving average and the 200-day moving average. Though usually considered an ominous signal for traders, it’s worth mentioning that traditional technical tools aren’t always as reliable for cryptocurrencies. Unlike traditional financial assets, cryptos face a liquidity shortfall that results in higher than normal volatility.
Ether’s ‘death cross’ has failed to inspire a bigger selloff, with prices quickly returning above $400. An RSI of 75 is another indication that momentum is on the side of the bulls, although levels that high normally imply overbought conditions.
Daily turnover in ether has steadily increased over the week from $1.3 billion to the current level of $1.5 billion. Bitfinex, Huobi and Binance are now the biggest markets for ETH trades.
Ether’s gains helped to spur a broader recovery for cryptocurrencies on Thursday, with the total value of digital assets rising to $275.2 billion, according to CoinMarketCap. That represents a gain of $21 billion from the Monday low.
Golem Arrives on Ethereum Mainnet
Ether’s price recovery has been aided in part by the arrival of Golem, the so-called ‘Airbnb for computers’. After two years of development, Golem officially launched on the Ethereum Mainnet this week in beta form. The project was one of the first to utilize Ethereum for its initial coin offering (ICO) some two years ago.
Golem raised 820,000 ETH during its token sale in November 2016. It took all of 8 minutes to raise that sum, which was equivalent to around $8 million at the time.
The project is intended to create a global market for excess computing power, allowing users to essentially ‘rent out’ idle CPU to others in exchange for cryptocurrency. All users will be paid in Golem’s GNT token, which is currently priced at 27 cents per coin. A total of 1 billion GNT tokens will be minted. There are currently 834.2 million GNT units in circulation, equivalent to $226.4 million.
Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
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