After 11 months of relentless bears, statistics from Susquehanna, a US based trading and technology firm has confirmed that mining Ether is no longer profitable. This is mostly due to a relentless bears that have since drove prices from $1400 to $200. Because of this, monthly mining profitability is now zero, down from $150 registered mid last year.

Unlike Bitcoin, Ethereum mining utilizes GPU chip sets. Though they guarantee complete decentralization, Ethereum does not have a predetermined issuance model. Then again at the moment there is no cap on the total amount of ETH that will ever circulate.

You May Like: Have All ICOs Sold Out? A Look at the Altcoin Survivors

Ethereum rewards consist of block rewards issued per the platform’s development roadmap. Eventually, it shall move to a proof-of-stake model and the inflation rate will depend on ETH stake. So at the moment, in order to smoothly transition from proof-of-work to proof-of-stake, a difficulty adjustment scheme is in place to exponentially increase the difficulty of mining ETH.

Interesting Read: ConsenSys and Amazon to Launch Ethereum Marketplace for Enterprise Blockchain

This would eventually force mining to become unprofitable and force a hard fork to use the proof-of-stake protocol. In order to address the impending mining difficulty, adjustment of the issuance model was necessary. As a result, during the Byzantine hard fork of 2017, block rewards were shaved from 5 to 3.

17/ Since the difficulty bomb is only going to be delayed for one year, another hard fork will be necessary on or around January 2020. #Ethereum will be experiencing a significant decline in its inflation rate as the roadmap advances.

— The Element Group (@TheElementGrp) November 13, 2018

In the upcoming Constantinople hard fork, core developers plan to reduce block reward issuance from 3 to 2 by mid January 2019 while pushing difficulty bomb implementation to 2020. Next year’s 33 percent reduction in the block reward will reduce inflation from its current level of 7.5 percent to 5 percent.

Weekly Chart

From a top down approach, it is clear that ETH/USD is struggling against sellers. Not only is it trading within a bear breakout pattern with clear point of interest at $250–$300 as resistance and $160 as support, but the fundamental factors are supportive of price.

Therefore in line with our previous ETH/USD price analysis, we recommend patience for risk-on traders until after there are strong, high volume losses below $160—Sep 2018 lows. Such breaks will confirm the bear breakout pattern of early August and usher the next wave of sellers aiming at $130 and later $50.

Daily Chart

The bear break out pattern of early Aug and Sep is clear in this time frame. Now that prices are in a clear bear trend confirming Oct 11 and Sep 5 losses as sellers step up, aggressive traders can begin unloading at spot with stops at $210 and first targets at $130 more so if there are solid losses below $160—Sep lows.

As aforementioned such losses shall trigger conservative sellers aiming at $130 and later $50.

All Charts Courtesy of Trading View

Disclaimer: Views and opinions expressed are those of the author and aren’t investment advice. Trading of any form involves risk and so do your due diligence before making a trading decision.

The post ETH/USD Price Analysis: Below $200 ETH Mining is Useless, Hash Rate Drop appeared first on NewsBTC.

Similar to Notcoin - Blum - Airdrops In 2024

origin »

168 +