Weiss Ratings: ‘Buy The Rumor, Sell the News’ as ETH Constantinople Draws Near
If there is one thing that can be said about Ethereum, is that 2018 sucked for it. 2019, however, has been a completely new story. At the moment, ETH has risen 9% and the market is seeing green all over the place as the Constantinople update is coming up.
Will this trend continue? Is 2019 the year of Ethereum? Well, Weiss Ratings is not so sure about this.
Ethereum’s Bull Run: 9% Up
At the moment, Ethereum is the third largest crypto in the world. It started 2018 as the second one, but it has dropped some positions during the year. Now, as the market is having a good week, Ethereum is having a blast. The token is 9% up in the last 24 hours. That is a lot.
However, the main problem here is that good things do not last forever and some people are starting to wonder where this will be really the start of a new bull market or just a short bull run that will end up in sadness and disappointment.
Weiss Ratings believes that the momentum will not help ETH’s future because Constantinople and the raise in price seems to be just a classic case of “buy the rumor, sell the news”.
Unless something more than just the update actually happens, the feeling is that Ethereum will simply not get on its feet so soon. Not if the whole market doesn’t, at least, as we all know that Bitcoin tends to pull prices up and down when it moves.
The Constantinople Upgrade
The Constantinople update is expected to be a hard fork that will happen on block 7,080,000 of the Ethereum blockchain. It is possibly happening tomorrow, January 16, as of the time of this report. Let’s see the main upgrades that Constantinople will bring to the network:
EIP 145: this upgrade was created to make smart contracts cheaper. How much cheaper? About 10 times cheaper. This will make the network much more efficient and quick, which can give it a real boost in efficiency.
EIP 1014: this is one of the highlights and it was created by Vitalik Buterin, the creator of the Ethereum blockchain, himself. It will enable a new technology on the chain called state channels.
EIP 1052: this one is focused on the verification of smart contracts and will allow them to verify each other, this is also made as a way to boost the speed of the technology and also to save some work.
EIP 1234: this change will regulate block rewards and delay the difficulty bomb, which was set up to be soon. What will happen is this: block reward will be reduced from 3 to 2 ETH as a way to reduce the inflation of the network’s price, however, the difficulty bomb will de delayed. This means that it will still be a good idea to mine without making the price of ETH drop.
EP 1283: finally, there is this one. It reduces the gas costs of the network and enables other updates to make transactions cheaper.
All these five changes will, indeed, improve the network. How much? That is actually the point here. Ethereum will stop growing because of the update if they only marginally improve Ethereum.
If these changes actually make a huge difference, though, they are likely to prove Weiss Ratings wrong and maybe Ethereum can even get its place as the second largest token back.