Vitalik Buterin is considered the founder of Ethereum and brought his idea to the public in 2013. Ethereum raised capital via crowdfunding in 2014.  The platform went to its main net on July 30, 2015. In 2016 , ETH forked from the original Ethereum and is known as ETC or Ethereum Classic. The two run separate organizations and blockchains.

Ether is the token or cryptocurrency which miners receive as a block reward for solving the mathematical computations for each block. A maximum of 18 million Ethereum can be mined per year, and the the block reward is 3 contracts, while a new block is mined approximately every 14 seconds.

The initial price per ETH token was 30 cents. Ethereum is currently trading 233 dollars per contract. An investor who bought 3,333 ETH contracts on the initial offering spent $1,000, that same investors holdings today are worth $776,589.

To equate this to ounces of Gold an investor could have traded .8 ounces of Gold in 2014 for 3,333 ETH. Today that investor could trade those ETH contracts for 500 ounces of Gold.

Ethereum currently has 109,657,000 contracts in circulation giving it a market cap of 25.37 billion dollars based on the last price of $232. Ethereum has the second largest market cap among exchange traded blockchain coins and tokens behind only Bitcoin.

ETH-BTC Exchange Rate

December of 2016,  ETH traded an all time low of $6.07

January 2018, ETH traded an all time high of $1,090.

The all time high was set in June 2017 at a rate of .15 ETH per BTC

The all time low was traded in September 2019 at a rate of .0161 ETH per BTC

The spectacular rise of ETH was fueled by the ICO market and the ERC20 contract.

When one thinks about how this worked, The ETH market was setting up for a major rise and major fall.

Good as Gold

Many of the ICO’s took payment in ETH, hence the panic-style buying. As we know not every vendor or business accepts ETH as a payment method, hence when the teams and new tokens who raised capital by collecting ETH needed to liquidate to Bitcoin or US Dollars, there were few to buy on the way down. What the ETH ICO market taught me was the primary use of blockchain in the financial system is raising capital, before this there were two basic methods, Equity raises and Debt raises.

Now we have a third method, selling cryptocurrency, or blockchain based tokens. Many seem to look at me in a strange fashion when I say this, but this is one of the biggest use cases for any asset. Even large commodities such as Gold, Crude or Wheat which have liquidity pools far bigger than Ethereum or even Bitcoin are not considered methods of funding businesses directly.  On the other hand, Ethereum and cryptocurrency are doing this right now.

Recently, Ethereum was added to the list of cryptocurrencies and tokens that are accepted at some large precious metals stores.  Bitcoin was the first, and now Ethereum is the second. When one hears the term, “Good as Gold” for most items, it is simply nothing more than a saying, but as of this writing, Ethereum is truly as good as Gold.

Ethereum Technicals

The next charts are based on technicals, not fundamentals and are focused on the ETH-BTC exchange rate.  I am not including the ETH in USD as Bitcoin still dominates more than 60% of the crypto space and if a pair has no trades over a set time period the US Dollar price is simply inferred by multiplying the “satoshi price” of said asset time the US Dollar Bitcoin price.

There are 100,000,000 satoshi’s in one Bitcoin.

Ethereum is currently worth 2,285,000 Bitcoin satoshis or .0285 Bitcoin

The inverse is 1 Bitcoin is worth 46.76 Ethereum.

ETH-BTC 1 year 

Low .0161

High .0357

Current .0228

The double bottom formed in the .0161 to .0175 zone and is bullish above .0226 with the next levels of interest on the upside at .0255 and .0305 respectively. From July 2019 to January 2020, ETH was scraping along the bottom. 

We spoke about this for months on the Genius Wednesday Podcast calls, and during this time our length was neither a loss nor a gain, but is now starting to bare some fruits.

ETH-BTC Six Month Chart

This chart has a distinct and different look as the ETH-BTC spread just broke out to the upside and is trading a new six month high.  The key support levels are .0199 and .017.

ETH-BTC 3 Month Chart

This three month chart of ETH-BTC highlights the bottom formation in December and January. Please note, this low at the .017 rate was well above the .0161 rate set earlier in 2019.  When it did not make a new low this confirmed that the bottom was set for this move.

ETH-BTC One Month Chart

This ETH-BTC one month chart highlights the extension of gains and as ETH gains Bitcoin satoshis new buyers are coming in at a faster rate than sellers are willing to supply.

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