Ethereum’s Gain is Also Its Loss Amidst the Continued Institutionalization
Yesterday, the largest digital asset took a hit and went down to about $11,110 level. Naturally, this then translated into losses for altcoins.
Altcoins went down hard with Cardano (ADA) being the biggest loser among the top cryptocurrencies while Aave (LEND) remaining the biggest gainer hitting yet another all-time rushing for $1 — up 67% in the past five days.
While bitcoin continues to record losses in the short-term, Ethereum continued to underperform and dropped by almost 10% below $400 to as low as almost $370.
At the time of writing, ETH/USD has been trading at $388.60, now in the green by over 2.2% but in the gains by 196% YTD.
Thanks to these gains, Ether now accounts for more than 30% of the total cryptocurrency market cap excluding Bitcoin, for the first time since September 2018.
However, while the exchange balance of BTC has gone down 9.6% in 2020 so far, Ether’s balance YTD change has been net positive of 10.4%.
— Rafael Schultze-Kraft (@n3ocortex) August 25, 2020
It has been these profits that have the ETH balance on crypto exchanges growing as investors look to take off profits. Even the ETHUSD longs in Bitfinex have seen a slight drop but that could be temporary just like in early August that led to the longs hitting new highs.
While Ether is in losses with the market looking to finish off the monthly lower, ConsenSys is making acquisitions and gaining investment.
As we reported, the institutionalization trend is continuing with the NY-based Ethereum venture studio founded by Ether co-founder Joseph Lubin which acquired Quorum, the Ethereum-based enterprise blockchain platform developed by mega-bank JPMorgan.
“We'll be working together with JP Morgan to merge the technical roadmaps of our own hyperledger basic client which is an Ethereum mainnet compatible client with the Quorum technical roadmap and under a commercial agreement we will be supporting JPMorgan's Interbank Information Network, the IIM, and JPM Coin network,” explained Lubin in an interview with CNN.
JPMorgan has also made a strategic investment in the company but the size of the investment hasn’t been confirmed by either of the parties.
“So we will be bringing a much more comprehensive enterprise Ethereum solution to not just JP Morgan and the hundreds of financial institutions on their networks but the additional hundreds of institutions around the world that make use of enterprise Ethereum and that are increasingly starting to make use of public mainnet Ethereum,” Lubin added.
Vulnerable to Attack
Amidst all this came a research that says more than $1 billion worth of tokens on the Ethereum blockchain is suffering from a software vulnerability — a fake deposit exploit.
This missing software standard is found to be in 7,772 issuers of ETC20 tokens which can be manipulated to hack the funds at about no cost.
“If the fake deposit attack is carried out, it is for sure a great disaster for the token,” said one of the researchers, Haoyu Wang, an associate professor of computer science at Beijing University of Posts and Telecommunications. “Worst case, the token has to be reissued.”
The possible fix is upon crypto exchanges which can blacklist malicious token contracts because smart contracts are permanent and can’t be reversed.