Though not a sudden one, Ethereum price decline is worrying a few investors and traders again as the cryptocurrency is trading at $180 levels after a week-long decline that wiped $50 off its value.
It is often seen that decline in prices leads to increase in trading volumes, but in the current scenario that’s not the case as Ethereum’s trading volumes have dived too to just above half a billion, down from a peak of $3.2 billion just a couple of weeks back.
The price decline and surge are seemingly becoming a weekly thing with prices increasing in one week followed by a price decline in the following week. However, the question remain as to why does this cycle exists and what is the reason behind this week’s decline?
Analysts believe that one of the reasons could be that traders and speculators are having a look at Bitcoin Cash and Bitcoin owing to the August 1 hard fork and this is drawing their attention away from other cryptocurrencies including Ethereum. The recent surge in Bitcoin prices indicates Bitcoin and Bitcoin Cash are garnering greater attention.
Bitcoin’s market share has breached the 50 per cent mark for the first time in many months and this could be a direct result of the impending hard fork. The split, according to some analysts, has reinforced the confidence of traders and investors alike and that’s why they are increasingly trading in Bitcoin.
Bitcoin Cash has been in the focus for a couple of weeks now and that could be another reason why Ethereum has taken a back seat with prices as well as trading volumes declining compared to where they were a couple of weeks back.